Oshawa, ON -- Network service provider Cygnal Technologies Corporation has sold its Burlington, ON distribution cen...
April 15, 2002
Oshawa, ON — Network service provider Cygnal Technologies Corporation has sold its Burlington, ON distribution centre as part of a $4.1 million, 12-year, sale and lease-back agreement. The company says it will use the proceeds of the sale to reduce its debt.
Cygnal’s 70,218 square foot facility, which houses its Communication Services Group, has been sold to the trustees of H&R REIT for cash. After discharging the $766,000 mortgage on the property, the remaining proceeds will be used to reduce interest-bearing debt.
“While we indicated during 2002 business outlook discussions last week that we were comfortable with our overall debt to equity ratio, we also indicated that we would take steps this year to further reduce our level of debt,” said Calven Iwata, senior VP and CFO of Cygnal. “The sale and lease-back of our Burlington distribution centre is an important step in that direction.”
The company expects additional lease costs to be offset by reduced debt interest expense and the money made on the property sale.