GreenPower Secures $5 Million Revolving Loan with EDC to Fund All-Electric Vehicle Production for Customer Orders
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The revolving loan agreement between GreenPower Motor Company Inc. and Export Development Canada (EDC) for up to $5 million signifies a strategic financial move that enhances GreenPower's liquidity. This access to capital is crucial for the company as it allows for the acceleration of production in line with customer demand, particularly important in the capital-intensive manufacturing sector. The structure of the facility, enabling multiple advances with repayments tied to vehicle delivery, aligns with GreenPower's cash flow needs, optimizing the timing of cash inflows and outflows.
Moreover, the non-dilutive nature of this financing is beneficial to current shareholders as it avoids the erosion of shareholder value that typically accompanies equity financing. This also reflects positively on GreenPower's financial management, as it suggests a prudent approach to capital structure optimization. The existing relationship with EDC and the expansion of their support could be interpreted as a vote of confidence in GreenPower's business model and growth trajectory, potentially impacting investor sentiment and the company's stock market performance.
The electric vehicle (EV) market is experiencing rapid growth, driven by increasing environmental concerns and supportive government policies. GreenPower's focus on the medium and heavy-duty EV market positions them in a niche yet expanding segment. The agreement with EDC not only provides the necessary financial backing to fulfill existing orders but also sends a signal to the market about GreenPower's capability to meet rising demand.
This financial development could be a competitive advantage, enabling GreenPower to scale production without the immediate pressure to secure additional capital. Investors and analysts should monitor the company's order fulfillment rate and customer feedback post-delivery, as these factors will be critical in assessing GreenPower's ability to capitalize on the market opportunity and sustain its growth momentum.
GreenPower's partnership with EDC underscores the broader economic implications of supporting clean technology industries. EDC's involvement is indicative of a governmental strategy to foster innovation and international competitiveness in sectors that align with environmental and sustainability goals. This approach can create a ripple effect throughout the economy, potentially leading to job creation, technology advancements and an increase in exports.
From an economic perspective, the success of companies like GreenPower might encourage further investments in green technologies and could contribute to a shift in the industrial composition of the Canadian economy towards more sustainable practices. The long-term economic benefits of such a shift include not only environmental improvements but also the potential for Canada to establish itself as a leader in the global EV market.
The Facility provides additional liquidity to GreenPower to fund all-electric vehicle production for approved customer orders, allowing for multiple advances over a two-year period with repayments when vehicles are delivered. The revolving nature of the Facility provides the flexibility to fund multiple orders and offers incremental capital in addition to GreenPower's existing
"GreenPower is excited to be expanding our relationship with EDC and secure a credit Facility that will accelerate our production of all-electric vehicles with existing orders. This Facility allows us to access funding over multiple orders for the next two years which has a multiplier effect on the sales we can generate," said Fraser Atkinson, CEO of GreenPower. "The mix of funding from EDC is a great fit with our production requirements and fulfilling our order book without shareholder dilution."
"EDC is thrilled to support GreenPower's international growth journey as they manufacture a wide range of commercial electric vehicles" said Guillermo Freire, Senior Vice-President, Mid-Market and responsible for Cleantech at EDC. "As a strategic partner, EDC is focused on supporting medium size companies like GreenPower achieve their true global potential."
For further information contact
Fraser Atkinson, CEO
(604) 220-8048
Michael Sieffert, CFO
(604) 563-4144
Allie Potter
Media Relations
(218) 766-8856
About GreenPower Motor Company Inc.
GreenPower designs, builds and distributes a full suite of high-floor and low-floor all-electric medium and heavy-duty vehicles, including transit buses, school buses, shuttles, cargo van and a cab and chassis. GreenPower employs a clean-sheet design to manufacture all-electric vehicles that are purpose built to be battery powered with zero emissions while integrating global suppliers for key components. This OEM platform allows GreenPower to meet the specifications of various operators while providing standard parts for ease of maintenance and accessibility for warranty requirements. GreenPower was founded in
Forward-Looking Statements
This document contains forward-looking statements relating to, among other things, GreenPower's business and operations and the environment in which it operates, which are based on GreenPower's operations, estimates, forecasts and projections. Forward-looking statements are not based on historical facts, but rather on current expectations and projections about future events and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. These statements generally can be identified by the use of forward-looking words such as "upon", "may", "should", "will", "could", "intend", "estimate", "plan", "anticipate", "expect", "believe" or "continue", or the negative thereof or similar variations. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. A number of important factors including those set forth in other public filings (filed under the Company's profile on www.sedar.com) could cause actual outcomes and results to differ materially from those expressed in these forward-looking statements. Consequently, readers should not place any undue reliance on such forward-looking statements. In addition, these forward-looking statements relate to the date on which they are made. GreenPower disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. ©2024 GreenPower Motor Company Inc. All amounts expressed in US dollars. All rights reserved.
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SOURCE GreenPower Motor Company
FAQ
What is the purpose of the revolving loan agreement between GreenPower Motor Company Inc. and Export Development Canada?
How much funding is available through the Facility provided by Export Development Canada?
What is the duration of the Facility for funding all-electric vehicle production?
Who is the CEO of GreenPower Motor Company Inc.?
What additional funding sources does GreenPower Motor Company Inc. have besides the $5 million Facility?
