High Liner Unharmed by Landsbanki Receivership

By

SeafoodSource staff

Published on
October 17, 2008

High Liner Foods said on Wednesday it has sufficient credit to fund current operating requirements despite the receivership of Icelandic bank Landsbanki, one of the Lunenburg, Nova Scotia, seafood company's three lenders in its working capital credit line.

In December 2007, High Liner entered into a CAD$120 million (US$101 million) credit facility with a syndicate of lenders, including the Royal Bank of Canada and CIT Business Credit Canada.

Landsbanki participated in the syndication of the loan by providing a revolving credit facility of CAD$40 million (US $33.7 million) to High Liner's U.S. subsidiary, High Liner Foods USA. Currently, less than $15 million is outstanding, including letters of credit.

Landsbanki said it will not respond right now to High Liner's request for an advance on the facility, and it has not provided any concrete information with respect to its ability to continue as a lender in the syndication.

"While the outcome of the Landsbanki situation is unknown, our overall credit facility is sufficient to fund our current operating requirements," says High Liner CFO Kelly Nelson. "Including the amount outstanding to Landsbanki, our total current borrowings are only $39.2 million and, including letters of credit at $8.8 million, our total utilization is $48 million, or 40 percent of the credit authorized under the overall syndicated facility."

"High Liner is fully compliant with its obligations under the facility, and Landsbanki has not to date indicated that it will not recommence servicing High Liner's loan," adds Nelson.

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