Algoma Central Corporation Announces Refinancing of Long-Term Debt

ST. CATHARINES, Ontario--(BUSINESS WIRE)--Algoma Central Corporation (“Algoma” or the “Company”) (TSX:ALC), a leading provider of marine transportation services, today announced that it has completed an amendment and expansion of its senior secured financing facilities. Proceeds from the expanded financing facilities will be used to repay the Bank Revolver (as defined below), to finance the Company’s investment opportunities, and for general corporate purposes.

The Company has entered into an amendment of its revolving bank credit agreement with a syndicate of six banks (the “Bank Revolver”), providing access to $634 million (all amounts in Canadian dollar equivalent) of credit, an increase of $182 million over the existing credit facility. The amendment also extends the maturity of the Bank Revolver from 2027 to 2031. Placement of the amended and extended Bank Revolver was led by Canadian Imperial Bank of Commerce.

In addition to the amendment and extension of the Bank Revolver, the expanded financing facilities also include $183 million raised in a private placement of senior secured notes payable by the Company (the “New Notes”). The New Notes, which have been issued in both US dollar and Canadian dollar tranches, have terms between three and five years and bear interest rates ranging from 4.45% to 5.49% per annum, with an overall effective rate at closing of 4.99%. The New Notes have been issued to a group of Canadian and US insurance companies. RBC Capital Markets, LLC led the issuance of the New Notes on behalf of the Company. Proceeds of the New Notes will be used to repay $183 million of outstanding advances under the Bank Revolver.

Borden Ladner Gervais LLP acted as counsel to the Company.

Both the New Notes and the Bank Revolver are secured by the material marine assets of Algoma and by guarantees pledged by the material subsidiaries of the Company.

The New Notes were offered and sold on a private placement basis to accredited investors in the United States and in certain provinces of Canada. The New Notes have not been and will not be qualified for sale to the public under applicable Canadian securities laws and, accordingly, any offer and sale of the New Notes in Canada will be made on a basis that is exempt from the prospectus requirements of such securities laws. The New Notes have not been and will not be registered under the United States Securities Act of 1933 (the “Securities Act”) or the securities laws of any other jurisdiction and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and state securities laws.

About Algoma Central Corporation

Algoma Central Corporation is a global provider of marine transportation, owning and operating dry and liquid bulk carriers that serve critical industries throughout the Great Lakes-St. Lawrence Region and internationally. Focused on delivering exceptional customer service, utilizing fuel efficient vessels, and advancing innovative technologies, Algoma drives productivity while contributing to economic growth, strengthening communities, and supporting its people. Algoma truly is Your Marine Carrier of Choice™. Learn more at algonet.com.

Forward-looking Statements

Algoma Central Corporation’s public communications often include written or oral forward-looking statements. Statements of this type are included in this document and may be included in other filings with Canadian securities regulators or in other communications. All such statements are made pursuant to the safe harbour provisions of applicable Canadian and United States securities legislation. The words "may", "will", "would", "should", "could", "expects", "plans", "intends", "trends", "indications", "anticipates", "believes", "estimates", "predicts", "likely" or "potential" or the negative or other variations of these words or other comparable words or phrases, are intended to identify forward-looking statements. Forward-looking statements in this news release include, but are not limited to, the intended use of proceeds from the expanded senior financing facilities, including the offering of the New Notes.

By their nature, forward-looking statements require us to make assumptions and are subject to inherent risks and uncertainties. There is significant risk that predictions, forecasts, conclusions or projections will not prove to be accurate, that our assumptions may not be correct and that actual results may differ materially from such predictions, forecasts, conclusions or projections. We caution readers of this document not to place undue reliance on our forward-looking statements as a number of factors could cause actual future results, conditions, actions or events to differ materially from the targets, expectations, estimates or intentions expressed in the forward-looking statements.