Algoma Central Corporation - Closes $260 Million Credit Facility

ALC-T

TORONTO , Nov. 10 /CNW/ - Algoma Central Corporation announces that it completed on November 9, 2009 a two-year $260 million credit facility with a syndicate of six financial institutions. The financial institutions include The Bank of Nova Scotia, Canadian Imperial Bank of Commerce, Bank of America, N.A., JP Morgan Chase , N.A., HSBC Bank Canada and Laurentian Bank of Canada .

This credit facility replaces the current $110 million revolving facility previously held by the Corporation. The new facility consists of a $200 million non-revolving term loan facility and a $60 million revolving loan facility. There are no required repayments during the term of the facility.

This financing facility combined with forecasted cash flows will be sufficient to meet the Corporation's existing capital commitments of approximately $144 million , repay the amount outstanding on the existing revolving facility of approximately $80 million and meet the Corporation's working capital requirements.

    
    The capital asset purchase commitments relate to the following:

    -  Construction of three 16,500 deadweight petroleum product tankers at
       Jiangxi Jiangzhou Union Shipbuilding Ltd. in China. These vessels are
       expected to be delivered in late 2010 and early 2011 and have
       remaining commitments of approximately $59 million.

    -  Construction of two maximum Seaway sized self-unloading forebodies
       which will be attached to the refurbished and upgraded aft-ends of the
       Algobay and another vessel at Chengxi Shipyard in China. The
       Corporation's share of the remaining commitments for these vessels
       which are expected to be delivered in late 2009 and in 2010 is
       approximately $29 million.

    -  Construction of two 25,000 deadweight petroleum product tankers at
       Nantong Mingde Shipyard in China. These vessels are expected to be
       delivered in mid 2010 and early 2011 and have remaining commitments of
       approximately $56 million.
    

In addition to the new facility, the Corporation also has two existing secured, non-revolving term loans totalling $37.5 million at November 9, 2009 .

Algoma Central Corporation, with its unrelated partner in Seaway Marine Transport, is the largest operator of dry-bulk vessels on the Great Lakes - St. Lawrence Seaway. Algoma Tankers operates seven product tankers throughout the Great Lakes to the Eastern Seaboard. The Corporation has five product tankers under construction that will join its one existing international product tanker and 18 additional product tankers owned by unrelated partners in Hanseatic Tankers. With its unrelated partners, the Corporation is part of a 29 vessel ocean-going dry bulk fleet. The Corporation jointly owns five vessels and wholly owns two of the vessels in the group. The Corporation also owns three ocean-going geared bulk carriers. The Corporation provides diversified ship repair, diesel engine repair services and fabrication services to ship-owners and industrial customers throughout the Great Lakes - St. Lawrence Waterway. The Corporation also has a mix of commercial real estate properties in Sault Ste. Marie, Waterloo and St. Catharines, ON.

For further information: Greg D. Wight, FCA President and Chief Executive Officer, [phone]; David G. Allen, CA, Vice President, Finance and Chief Financial Officer, [phone]