Company also says discussions have advanced with U.S. investor
Ottawa-based Allen-Vanguard (TSX: T.VRS, Stock Forum) announced Thursday that it has reached an agreement with its lenders to defer a US$4.8 million quarterly principal repayment due Thursday to September 30.
The company, which develops technologies, tools and training for defeating and minimizing the effects of hazardous materials also reported on the status of discussions with a U.S. investor regarding a going-private transaction first announced in April.
"This has been an extensive process," said David E. Luxton, the company’s president and CEO.
"Discussions have advanced to the point where we may shortly conclude definitive terms, but should we not do so then we will resume discussions with other specific, interested parties with a view to reducing our long-term debt by a minimum of $US50 million by September 30, 2009, as previously stated," he added.
Luxton also noted that the company is concentrating sales efforts in the Middle East, Latin America and parts of Asia.
“As well, with the draw-down of U.S. troops in Iraq and intensified conflict in Afghanistan we expect to finally see quantity orders for Symphony systems now that U.S. Supplemental funding has been passed and is in place for these requirements. With slippage into the next quarter we have re-planned our forecast and cash flow accordingly with the continued support of our lenders," he added.
Shares of the company moved slightly higher Thursday, up 8% to 13.5 cents.
On the company’s Bullboard, TechOne said: “With debt extension all the more reason to just stay put here I think..[sic]”
While kidl2 replied: “I agree. Lenders obviously figure that this thing is worth more alive than dead or else they would have called the loan and sold the pieces[sic].”
And, SmCap99 noted: “Not agreeing or disagreeing, but as usual, not enough information to draw a conclusion. Maybe the bank doesn't know what to do with it if it got it, and has just given enough slack to see if the buyer completes the sale and takes the bank out. By Sept the facility basically gives them the keys to the company if the $50M payment isn't made[sic].”
