Summary
Archer-Daniels-Midland Company (ADM) filed an 8-K on April 2, 2012, to report on an amendment to its receivables securitization facility. This facility, originally established in July 2011, allows ADM and its subsidiaries to obtain up to $1.0 billion in funding by selling U.S.-originated accounts receivable. The amendment, effective March 27, 2012, restates the existing agreement and involves entities such as ADM Receivables, LLC, various conduit and committed purchasers (including The Bank of Tokyo-Mitsubishi UFJ, Ltd. and Rabobank), and a collateral agent. The key impact for investors from this amendment is a change in accounting treatment for receivable balances. Previously reported as trade receivables on ADM's balance sheet, these balances will generally no longer be classified as such if funding is obtained under the facility following the amendment. The facility is set to terminate on June 29, 2012, unless extended.
Key Highlights
- 1ADM amended and restated its receivables securitization agreement on March 27, 2012.
- 2The facility allows ADM to access up to $1.0 billion in funding.
- 3Funding is secured against U.S.-originated accounts receivable.
- 4The amendment changes the accounting classification of certain receivable balances from trade receivables to amounts funded under the facility, if applicable.
- 5The transaction involves ADM Receivables, LLC, conduit purchasers, committed purchasers (BTMU, Rabobank), and a collateral agent.
- 6The securitization facility has a scheduled termination date of June 29, 2012, with an option for extension.
- 7This filing was made on April 2, 2012.