Elders (ELD) has struck a deal with financier to extend its loan facilities and flagged a series of job cuts as the group pushes forward with its repositioning as a purely agricultural business.
In a statement to the Australian Securities Exchange, Elders said the renewed finance facilities would run until December 31, 2014, subject to final credit approvals and documentation.
Elders said the syndicated finance facilities were structured to service the forecast requirements of the group and will include a mixture of term debt facilities worth up to $144 million, working capital and contingent facilities of up to $87 million and a debtor securitisation facility of up to $183 million.
"The extension and renewal of Elders’ syndicated finance facilities underpins a comprehensive plan to reposition Elders as a pure agribusiness, focused on its branch network and trading operations operating within and from Australia and New Zealand," the group said.
"The plan includes the now completed sale of Futuris Automotive; the final exit from its forestry business; and a partial sale of its equity holding in Elders Insurance."
As Elders moves forward with its reorganisation and new business model it expects to undertake a reduction of about 10 per cent of employee numbers.
"A small number of rural and regional branch offices will be closed or consolidated into larger nearby branches to ensure sustainability of the network operations in the long-term," Elders said.
The news comes just a month after Elders sold its Futuris Automotive business to US private equity firm Clearlake Capital Group for $56 million.
Elders today said that deal was complete, with the proceeds reducing Elders' gross debt to approximately $330 million and net debt to $272 million.
Elders said it expects its full-year underlying earnings in fiscal 2013 to come in between a loss of $32 million and $39 million.