Abaco Markets has removed fears over its future as a going concern by negotiating a two-year extension of its credit facilities through to August 2005 with the Royal Bank of Canada, shareholders attending the annual general meeting wewre told, as the retail conglomerate predicted it would make a $1.2 million net loss for the 2003 full year before its turnaround strategy bore fruit.
David Thurlow, Abaco Markets president, said the agreement with the Royal Bank of Canada would "require us to manage costs fairly tightly" after the latter agreed to the business plan put forward by the retailer.
As part of the arrangement, the maturity of Abaco Markets' term was extended from September 2004 to 2005 but, in return, 50 per cent of the proceeds from the asset sales have to be applied to paying down term debt. The remainder can be used by the firm for operational purposes.
In addition the Royal Bank has increased the interest rate attached to Abaco Markets' debt repayments by .5 per cent to Bahamian prime plus 2 per cent, although Mr. Thurlow said this rise "can be temporary. If we hit our targets over the next 12 months, the interest rate will come back down. It's an incentive to manage efficiently."
Source: The Tribune
