EDMONTON, Alberta -

AutoCanada announced this week it has increased its existing syndicated credit agreement by $60 million, bringing total availability to $190 million. 

The facility now includes HSBC Bank Canada, Alberta Treasury Branches, and Royal Bank of Canada with HSBC acting as administrative agent to the Credit Agreement. 

"We very much appreciate the support and continued confidence in our business plan from our current partners HSBC and ATB, as well as our new partner, RBC, as reflected in their agreement to increase the credit amounts under our Credit Agreement. RBC has been a partner of AutoCanada since our 2006 IPO and, as a very well established player in the Canadian auto retail market, we are very pleased to have them join the syndicate." stated Pat Priestner, chairman and chief executive officer of AutoCanada.

The revised credit agreement provides AutoCanada with the following facilities:

  • a $70 million revolving operating facility which may be used for ongoing working capital and general corporate purposes including acquisitions;
  • a $30 million revolving acquisition facility which may be used for the acquisition of auto dealerships and associated real estate;
  • a $90 million non-revolving term facility which may be used to purchase owner occupied real estate, refinance existing real estate and to fund construction costs of new dealerships.

The $90 million allotted to be used to purchase owner occupied real estate, refinance existing real estate and to fund construction costs of new dealerships may come in handy as the company has been steadily adding stores to its lineup.

Just last week, the company announced General Motors of Canada has given it the green light on a new dealership investment, marking the company’s fourth dealership in Winnipeg.

More specifically, AutoCanada said it was expanding their dealership count with the acquisition of McNaught Cadillac Buick GMC, located in Winnipeg, Manitoba. In 2013, this store retailed 593 new vehicles and 520 used vehicles.

And this acquisition came shortly after the company announced it was awarded the right to a Volkswagen open-point dealership in Sherwood Park, Alberta, in late February. Back in December when AutoCanada revealed its Q3 results, company management said it believes the dealership group is “well positioned” to add four to seven dealerships to its stores in the coming 18 months.