Timing is everything and Boca Raton, Florida-headquartered Office Depot, one of the world’s largest providers of office products and services, executed a new $1.25 billion asset-based credit facility just as conditions in the trade finance market began to deteriorate at the end of September 2008. “We have seen no changes in our trade finance costs or availability as a result,” says Scott Craig, assistant treasurer at the company.
The asset-based facility replaced a $1 billion standard revolving credit facility and was arranged with 15 banks. It enables Office Depot to borrow by pledging certain accounts receivables and inventory as security – though not to the full value of the security. In addition, the facility has a carve-out that...
