Earlier this year – and after lively discussions between Dorel Industries Inc. and its shareholders – the Canadian conglomerate pulled out of the announced going-private transaction. With shareholders clearly expressing confidence in Dorel’s future and the greater potential for Dorel as a public company, the Canadians now announced that “it and several of its subsidiaries have entered into a new $450 million (€371m) senior secured asset based revolving financing with institutional lenders led by Bank of Montreal as lead arranger, administrative agent and sole bookrunner.” The new credit facility, which is guaranteed by certain of Dorel’s subsidiaries, has a term of two years from the date of the initial advance and can be extended for additional one-year terms with the consent of the lenders.
The announcement came about a month after Dorel reported strong Q1 results for fiscal 2021. Since last year, helped in part by the Covid-19 pandemic, Dorel’s Dorel Sports division, with its Cycling Sports Group (CSG - with brands Cannondale, Fabric, GT, etc.) and Pacific Cycle Group (PCG - Ironhorse, Schwinn, etc.), and its Dorel Home division have been on an upward sales trajectory. After a long lean period in the pre-Covid era – and despite some hurdles such as serious delivery problems – both management and shareholders believe in further value growth.
To continue and further contain its growth momentum, the listed group completed the aforementioned $450 million financing on June 14.