TORONTO, ON - BG Furniture will soon have a new investment partner.
Grenville Strategic Royalty Corp.said it has contracted with the furniture company for "a gross sales royalty" in exchange for a $750,000 advance, with an additional $500,000 made optional. In exchange, Grenville (TSX VENTURE:GRC) says, it will receive a royalty of between 1 percent and 4 percent, off BG Furniture's gross revenues.
Formerly known as Bogden and Gross, the 87-year-old BG Furniture designs and manufactures residential and office furniture from its plant based in Walkerton, ON.
"Grenville has allowed us to accelerate our growth strategy and advance the company's services for our expanding customer base, as well as continue to innovate and bring new Canadian made, solid wood furniture to market," BG Furniture President Adam Hofmann said in a statement.
Dirk Nielsen, vice president of manufacturing, added,"Over the next five years, we plan to invest over $5 million in new product development, technological advancement in manufacturing, new products, creating good paying jobs in the process."
The BG Furniture financing brings to 20 the number of investments Grenville has made since its inception in July 2013. To date, Grenville said, it has completed approximately $20.86 million in royalty financings across Canada and the U.S.
"BG Furniture is a great example of the reinvention of Canadian manufacturing - an 87 year old company making a high quality product using advanced manufacturing strategies and impeccable design. We are delighted to invest in the community of Walkerton, Ontario with this expert management team and skilled workforce," noted William Tharp, Grenville president and CEO.
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