Calgary, Alberta--(Newsfile Corp. - September 9, 2022) - Solution Financial Inc. (TSX: SFI) (OTCQX: SLNFF) (the "Company") a leading provider of luxury automotive and yacht leasing in Canada, today announced the close of a $15 million Credit Facility with ATB Financial ("ATB"). This facility is replacing the existing $12.5 million facility.
Adds an additional $2.5 million of available credit
Is more optimally structured to support future growth financing arrangements
Maintains the Company's non-dilutive and low interest capital necessary to continue to grow the Company's profitability
Demonstrates the impact of an expanded collaboration with Geminus Acquisitions & Management Inc. ("Geminus") to support the Company's long-term growth initiatives
"We are very pleased to finalize this facility with ATB," said Bryan Pang, Solution Financials Chief Executive Officer. "Our Chairman, Randy Smyth and the whole Geminus team worked diligently with our internal team over the last nine months to enhance our leasing infrastructure and introduce invaluable long term financing partners such as ATB. We're excited to hit this major milestone and continue to expand our lease financing options to luxury automobile and marine dealerships throughout Alberta, British Columbia, and Ontario. Many of our dealership partners were impacted by lower new vehicle sales volumes due to the COVID semiconductor challenges and the new Federal luxury sales taxes, only to now be seeing higher borrowing costs for their customers and some of the most restrictive lending requirements imposed by Canadian banks targeting luxury auto and new immigrant borrowers that we've ever seen. We're committed to supporting these existing and future dealership partners and their clientele with prudent financing options and a welcoming and friendly approach that is the backbone of our entire organization and the foundation of our successes to date," concluded Bryan.
The $15 million secured line of credit facility bears interest at prime plus 1.5% per annum (current total interest of 6.2%) and will all be used initially to replace the Company's existing credit facility amounting to approximately $8.3 million. The Company's gross lease portfolio recently surpassed $29 million ($26 million net of down payments) generating annualized recurring interest and leasing revenues of $6.6 million. In connection with the credit facilities, the Company paid a fee of 1.25% of the credit facility to Geminus. Geminus is a related party as it is controlled by a director of the Company.
Solution Financial Inc. was founded in 2004 and is headquartered in Richmond, British Columbia, and Calgary, Alberta. Solution specializes in sourcing and leasing luxury and ultra luxury vehicles, yachts, and other limited-edition assets that tend to hold their value over time. The company pioneered an innovative leasing program that has helped make Metro Vancouver the luxury car capital of North America. Solution utilizes a streamlined finance leasing model specializing in assets with limited supply and high resale value. This leasing alternative has proven extremely popular with affluent immigrants, international students, and business owners who may have limited credit histories in Canada or prefer more flexible vehicle ownership options.
For further information please contact Sean Hodgins at (778) 318-1514.
ON BEHALF OF THE BOARD
(signed) "Bryan Pang"
President, CEO and Director
Neither TSX nor its Regulation Services Provider (as that term is defined in the policies of the Exchange) accepts responsibility for the adequacy or accuracy of this release.
NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/136538