Newsroom
2003
CWB launches new borrowing program; first issue available to retail investors
November 12, 2003
Winnipeg – The Canadian Wheat Board (CWB) is expanding its borrowing programs by adding a domestic medium-term note program. The first issue under the program is a managed futures note and marks the first time the CWB has targeted retail rather than institutional investors as a source of funding.
These notes are available through accredited Canadian financial advisors with a minimum investment of $2,000. This issue will close in early April 2004.
“This new program, and the notes to be issued from it, will enhance our access to cost-effective funding and diversify our sources of capital,” explained Adrian Measner, President and CEO of the farmer-controlled CWB. “By adding to our borrowing programs in this way, we are able to access a lower cost of funding and generate additional revenue for western Canadian farmers.”
The CWB has no equity capital. All sales revenues less operating costs are paid to farmers every year. Farmers have not purchased shares in the company nor does the CWB withhold profits to finance operations from one year to the next. Therefore, the CWB has to borrow money to pay for its operations and to pay farmers for their grain deliveries.
The money the CWB borrows finances credit sales to customers, finances its operations and the cash advance program. The CWB’s ongoing borrowing requirements are approximately $7 billion. Since 1989, the CWB has launched five independent borrowing programs. These include Canadian, U.S. and Euro commercial paper programs, a Euro medium-term note program and the new domestic medium-term note program.
For this first issue, the CWB has partnered with Tricycle Asset Management, an established financial management company specializing in managed futures, which will market the CWB managed futures note to financial advisors. The new managed futures note issue is expected to raise $150 million.
Controlled by western Canadian farmers, the CWB is the largest wheat and barley marketer in the world. As one of Canada’s biggest exporters, the Winnipeg-based organization sells grain to more than 70 countries and returns all sales revenue, less marketing costs, to Prairie farmers.
For media inquiries, please contact:
Rhéal Cenerini
Communications consultant
Winnipeg, MB
tel: (204) 983-4497
Financial advisors, please contact:
Tricycle Asset Management
tel: 1-800-315-5298
Investor inquiries, please contact:
A financial advisor or Tricycle Asset Management
tel: 1-800-315-5298