Omega Protein Announces New $35 Million Credit Facility
Published October 22nd, 2009
Omega Protein Corporation (NYSE: OME), the nation’s leading producer of Omega-3 fish oil and specialty fish meal products, today announced that it has entered into a new $35 million senior secured credit facility with Wells Fargo Bank, National Association. The new credit facility consists of a 3-year revolving credit facility of up to $35 million, including a $7.5 million sub-limit for the issuance of standby letters of credit, and is secured by substantially all of the Company’s assets except for those already pledged in connection with existing federal Fisheries Finance Program loans.
The new credit facility replaces the Company’s existing credit facility with a syndicate of banks led by Bank of America, N.A, under which, just prior to the closing date, $11.4 million was outstanding under a term loan and $2.8 million was outstanding under letters of credit. The Company prepaid the term debt at closing and the letters of credit were transferred to Wells Fargo Bank.
Joe von Rosenberg, Chairman of the Board and Chief Executive Officer of Omega Protein, commented: “This new credit facility provides the Company with more favorable terms than the old facility and should reduce our future borrowing costs. We are pleased with the new relationship with Wells Fargo.”
In connection with the termination of the Company’s existing credit facility, the Company expects to incur an approximate $0.4 million charge in the fourth quarter of 2009 for the write-off of loan origination and related fees. Additionally, the early termination of the existing credit facility renders the associated interest rate swaps to be ineffective which results in approximately $1.4 million to be recognized as an interest expense in the third quarter of 2009.
About Omega Protein
Omega Protein Corporation is the nation’s largest manufacturer of heart-healthy fish oils containing Omega-3 fatty acids for human consumption, as well as specialty fish meals and fish oil used as value added ingredients in aquaculture, swine and other livestock feeds. Omega Protein makes its products from menhaden, an Omega-3 rich fish that is not utilized as seafood, but which is abundantly available along the U.S. Gulf of Mexico and Atlantic Coasts.
