Sale Of Non-United States Accounts Receivable

3 Months Ended

Jan. 31, 2015

Sale Of Non-United States Accounts Receivable

NOTE 3 — SALE OF NON-UNITED STATES ACCOUNTS RECEIVABLE

On April 27, 2012, Cooperage Receivables Finance B.V. and Greif Coordination Center BVBA, an indirect wholly owned subsidiary of Greif, Inc., entered into the Nieuw Amsterdam Receivables Purchase Agreement (the “European RPA”) with affiliates of a major international bank. The maximum amount of receivables that may be sold and outstanding under the European RPA at any time is €145 million ($165.0 million as of January 31, 2015).

In October 2007, Greif Singapore Pte. Ltd., an indirect wholly-owned subsidiary of Greif, Inc., entered into the Singapore Receivable Purchase Agreement (the “Singapore RPA”) with a major international bank. The maximum amount of aggregate receivables that may be financed under the Singapore RPA is 15.0 million Singapore Dollars ($11.2 million as of January 31, 2015).

In May 2009, Greif Malaysia Sdn Bhd., an indirect wholly-owned subsidiary of Greif, Inc., entered into the Malaysian Receivables Purchase Agreement (the “Malaysian Agreement”) with Malaysian banks. In March 2014, the Malaysian Agreement was discontinued and therefore there were no receivables held by third party financial institutions under this agreement as of January 31, 2015.

The table below contains certain information related to the Company’s accounts receivables programs (Dollars in millions):


	Three months ended
	January 31,
	2015		2014
European RPA
Gross accounts receivable sold to third party financial institution	$	191.5	$	243.5
Cash received for accounts receivable sold under the programs		169.4		215.4
Deferred purchase price related to accounts receivable sold		22.0		28.1
Loss associated with the programs		0.5		0.7
Expenses associated with the programs		—		—

Other
Gross accounts receivable sold to third party financial institution	$	11.6	$	15.8
Cash received for accounts receivable sold under the program		11.6		15.8
Deferred purchase price related to accounts receivable sold		—		—
Loss associated with the program		—		—
Expenses associated with the program		—		0.1

Total RPAs
Gross accounts receivable sold to third party financial institution	$	203.1	$	259.3
Cash received for accounts receivable sold under the program		181.0		231.2
Deferred purchase price related to accounts receivable sold		22.0		28.1
Loss associated with the program		0.5		0.7
Expenses associated with the program		—		0.1

The table below contains certain information related to the Company’s accounts receivables programs and the impact it has on the Condensed Consolidated Balance Sheets (Dollars in millions):


	January 31,			October 31,
	2015			2014
European RPA
Accounts receivable sold to and held by third party financial institution	$	123.4		$	164.7
Deferred purchase price liability related to accounts receivable sold		(12.6	)		(23.7	)

Other
Accounts receivable sold to and held by third party financial institution	$	5.0		$	5.0
Uncollected deferred purchase price related to accounts receivable sold		—			—

Total RPAs
Accounts receivable sold to and held by third party financial institution	$	128.4		$	169.7
Deferred purchase price liability related to accounts receivable sold	$	(12.6	)	$	(23.7	)

The deferred purchase price related to the accounts receivable sold is reflected as prepaid expenses and other current assets or other current liabilities on the Company’s condensed consolidated balance sheets and was initially recorded at an amount which approximates its fair value due to the short-term nature of these items. The cash received initially and the deferred purchase price relate to the sale or ultimate collection of the underlying receivables and are not subject to significant other risks given their short-term nature; therefore, the Company reflects all cash flows under the accounts receivable sales programs as operating cash flows on the Company’s condensed consolidated statements of cash flows.

Additionally, the Company performs collections and administrative functions on the receivables sold, similar to the procedures it uses for collecting all of its receivables, including receivables that are not sold under the RPAs. The servicing liability for these receivables is not material to the condensed consolidated financial statements.

- Definition

The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses.

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