Kraken Robotics enters into new credit agreement to support growth
by CM Staff
Kraken Robotics Inc. announced that it has entered into a credit agreement with The Bank of Nova Scotia for credit facilities that are expected to provide added financial flexibility to support the Company’s continued growth.
ST. JOHN’S — Kraken Robotics Inc. announced that it has entered into a credit agreement with The Bank of Nova Scotia for credit facilities that are expected to provide added financial flexibility to support the Company’s continued growth.
The Credit Facilities consist of: (i) a revolving 3-year term facility of up to $35 million (subject to meeting certain borrowing base requirements based on eligible receivables and inventory); (ii) a $10 million revolving capital expenditure line of credit; (iii) a $10 million uncommitted letter of credit facility; and (iv) an uncommitted accordion facility of up to $30 million. The Credit Facilities replace in its entirety the Company’s existing credit facilities with Royal Bank of Canada which were paid out using funds drawn from the Credit Facilities effective April 19, 2024.
The Credit Facilities bear interest at bank prime interest rates plus a margin of between 1.00% and 1.75%.
Kraken expects to use the credit facility to facilitate its long-term strategy including to further strengthen the Company’s balance sheet in anticipation of the continued growth in Kraken’s business including upcoming customer and partner decisions on additional large, new program and contract opportunities, and to fund capital expenditures, for working capital, and for general corporate purposes.
“We are pleased to announce the execution of our new Credit Facilities. Our ability to complete this transaction reflects the strong momentum we have experienced and the solid outlook we have for our business. With our strong EBITDA growth outlook, our capital structure can comfortably support increased debt, while still maintaining significant financial flexibility,” said Joe MacKay, Chief Financial Officer at Kraken.
“The successful negotiation of the Credit Facilities provides us with greater financial flexibility to execute on our growth strategy that consists of investing in our business to drive organic growth and in pursuing accretive strategic acquisitions,” said Greg Reid, President and Chief Executive Officer at Kraken.
