Lenders have come calling for Legumex Walker Inc.’s canola processing business.
According to a statement from the company, Pacific Coast Canola has defaulted on its loans, owing an estimated US$54.6 million. AgCountry Farm Credit Services, which represents a syndicate of lenders under PCC’s senior credit facility, has served notice demanding the repayment of all amounts due. The amount owed is secured by a first lien on all assets and undertaking of the canola business, with its lone processing plant at Warden, Washington.
Legumex Walker, which owns 84 percent interest in Pacific Coast Canola, says PCC does not currently have access to funds to satisfy its obligations, and that if it’s unable to refinance its loans, PCC will cease operating. The company is in discussions with AgCountry and other lenders regarding alternatives for financing the PCC crush plant.
LWI also says it does not expect AgCountry’s demand or PCC’s default will affect its Special Crops Division, which operates separately. AgCountry is not a lender to the special crops business.
Headquartered in Winnipeg, Legumex Walker was formed in 2011 after the merger of St. Jean, Manitoba-based Roy Legumex and Walker Seeds of Tisdale, Saskatchewan. With 14 plants in Canada, the U.S. and China, LWI produces food and feed ingredients from sunflowers, flax, canary seed, lentils, peas, beans and chickpeas. The Pacific Coast Canola plant, which uses an expeller-press process, started operating in 2013. Glencore owns the other 16 percent stake in PCC.