The shareholder letter stated "we expect to finalize a material acquisition in the coming days." While the acquisition may have been finalized, Tom will choose the right time to report it.
Seaway Valley Capital Corporation Releases Update
Monday March 17, 8:00 am ET
NEW YORK--(BUSINESS WIRE)--Seaway Valley Capital Corporation (OTC Bulletin Board: SWVC - News) (“Seaway Valley”) chairman and chief executive officer, Thomas W. Scozzafava, issued the following update to its shareholders today:
Dear Shareholders:
We are pleased to announce the final closing of and funding from the previously announced Wells Fargo inventory-based line of credit (the “Wells Fargo LOC”) at our wholly owned subsidiary, Patrick Hackett Hardware Company (“Hackett’s”). Hackett’s expects to immediately draw down approximately $2 million of the $5 million facility leaving excess capacity of around $3 million, which should be sufficient to fund Hackett’s working capital needs through 2008. Also in conjunction with that financing, YA Global Investments, L.P. acquired Hackett’s legacy indebtedness previously owed to Community Bank, NA. If not acquired, the Community Bank debt of approximately $2.25 million would have to have been repaid with the proceeds of the Wells Fargo LOC, thereby significantly reducing Hackett’s excess availability of that line. The acquisition of this debt was strategic in that Hackett’s can now utilize a much larger portion of the Wells Fargo LOC for asset acquisitions and store expansions.
In the following months, we expect Hackett’s to transition each former WiseBuys store as well as acquire at least two other regional retailers. Additionally, we expect Hackett’s to finalize at least one new store opening. In summary, Seaway Valley will continue to financially and operationally support Hackett’s, whether through company or asset acquisitions or general expansion.
Seaway Valley also continues to seek other acquisitions and investments, and we expect to finalize a material acquisition in the coming days. Recently Seaway Valley announced that it executed a term sheet and is in final negotiations to acquire a regional hospitality and consumer products company with recent revenues and assets of approximately $5 million and $13 million, respectively. The consumer products company, based in Upstate New York region, would bring tremendous opportunities for cross selling and promotional efforts among and between these geographically clustered assets. Additionally, certain of these assets represent a tremendous platform that Seaway can immediately assist in positioning for growth inside and outside the region – both organically and through additional acquisitions.
I am pleased to be able to update you on these events, and I shall continue to update you with further developments.
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