Conifex Timber has announced the completion of a $25 million secured term loan with PenderFund Capital Management. This loan will repay Conifex’s $11 million credit facility with Wells Fargo Capital Finance Corporation Canada, with the remaining funds used for working capital and general corporate purposes.
Ken Shields, Conifex CEO, expressed gratitude for PenderFund’s support, highlighting the flexibility the loan provides to strengthen operations in Mackenzie. PenderFund’s Geoff Castle acknowledged the challenges in B.C.’s forestry sector but remained optimistic about Conifex’s long-term value.
The five-year loan, bearing 14 per cent interest, is secured by Conifex’s lumber assets. Conifex will also issue 3.6 million warrants to PenderFund, exercisable at $0.75 per share.
Conifex is now exploring a working capital facility to ensure liquidity during low lumber prices. Its total long-term debt stands at $75.3 million, with an average interest rate of 9.29 per cent.
Conifex plans to hold its annual shareholders’ meeting in the third quarter of 2024, later than usual, to focus on financial strategies. Raymond James Ltd. advised Conifex on the transaction.
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