IBI Group Inc. Announces Completion of Rights Offering
Wednesday, December 23, 2015
TORONTO, ON — December 22, 2015 (Marketwired) – IBI Group Inc. (“IBI” or the “Company”) (TSX: IBG) is pleased to announce the completion of its previously announced rights offering for additional Common Shares of IBI (a “Right”) to holders of its common shares (the “Common Shares”), which expired at 5:00 p.m. (Toronto Time) on December 18, 2015.
The company received subscriptions for a total of 3,775,000 Common Shares under the basic subscription privilege and subscriptions for a further 3,584,873 Common Shares under the additional subscription privilege, representing an over-subscription against the 4,452,121 Common Shares available under the rights offering. Subscribers for Common Shares under the additional subscription privilege have received their pro rata entitlement to the 677,121 Common Shares remaining under the rights offering after allocation of the 3,775,000 Common Shares under the basic subscription privilege. A total of 4,452,121 Common Shares have been issued under the rights offering. The rights offering raised net proceeds of $6,723,000 (after deducting estimated expenses relating to the rights offering). The net proceeds will be used to repay indebtedness.
Upon completion of the rights offering, a total of 22,260,606 Common Shares are issued and outstanding.
As the rights offering was fully subscribed, IBI Group Management Partnership and its affiliated partnerships, which had agreed to provide a standby commitment, did not subscribe for any additional Common Shares available as a result of unexercised Rights pursuant to the standby commitment. IBI Group Management Partnership and its affiliated partnerships subscribed for 965,050 Common Shares under the basic subscription privilege, and following the completion of the rights offering, IBI Group Management Partnership and its affiliated partnerships hold approximately 22% of the outstanding Common Shares.
Concurrently with the rights offering, IBI Group Management Partnership subscribed for 1,256,444 additional Class B Units of IBI Group partnership on terms substantially similar to those of the rights offering, pursuant to rights issued to it as the holder of all of the 5,025,778 outstanding Class B Units, which are exchangeable for Common Shares. The subscription price was paid by a promissory note, which was set off against the corresponding amount of indebtedness owing by IBI Group to IBI Group Management Partnership, and resulted in further debt reduction of approximately $2,010,000. Following the rights offerings of the Corporation and IBI Group, IBI Group Management Partnership and its affiliated partnerships hold an interest of approximately 39.2% in the Corporation (on a partially diluted basis, assuming the exchange of Class B Units for Common Shares).
As previously disclosed, a portion of the remaining IBI Group indebtedness to IBI Group Management Partnership will be used to satisfy the subscription price for additional Common Shares to be subscribed for by IBI Group Management Partnership pursuant to a private placement, subject to a limit such that it will hold an ownership interest of less than 50% in the Company (on a partially diluted basis, assuming the exchange of Class B Units for Common Shares).
Caution Regarding Forward-Looking Information
Statements in this news release that describe the Company’s or management’s expectations, forecasts, guidance or estimates may constitute “forward-looking” statements, and such statements use words such as “may”, “will”, “expect”, “believe”, “plan” and other similar terminology. Forward-looking statements also include statements that are not historical facts. Forward-looking statements reflect management’s current expectations regarding future events and operating performance and speak only as of the date of this news release. Forward looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, IBI Group, or the industry in which they operate, to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, such statements are not guarantees of future performance and actual results or developments may differ materially from those in forward-looking statements. Forward-looking statements involve a number of risks and uncertainties, including those related to: (i) IBI’s ability to maintain profitability and manage its growth; (ii) IBI’s reliance on its key professionals; (iii) competition in the industry in which IBI operates; (iv) timely completion by IBI of projects and performance by IBI of its obligations; (v) fixed-price contracts; (vi) the general state of the economy; (vii) risk of future legal proceedings against IBI; (viii) the international operations of IBI; (ix) reduction in IBI’s backlog; (x) fluctuations in interest rates; (xi) fluctuations in currency exchange rates; (xii) upfront risk for time invested in participating in consortia bidding on large projects and projects being contracted through private finance initiatives; (xiii) limits under IBI’s insurance policies; (xiv) the Company’s reliance on distributions from its subsidiary entities and, as a result, its susceptibility to fluctuations in their performance; (xv) unpredictability and volatility of the price of the Company’s shares; (xvi) the degree to which IBI is leveraged and the effect of the covenants in IBI’s credit facilities; (xvii) the possibility that the Company may issue additional shares diluting existing shareholders’ interests; and (xviii) income tax matters. See “Risk Factors” discussed in the Company’s Annual Information Form filed with the Canadian securities regulatory authorities. New risk factors may arise from time to time and it is not possible for management of the Company to predict all of those risk factors or the extent to which any factor or combination of factors may cause actual results, performance or achievements of the Company to be materially different from those contained in forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. Although the forward-looking statements contained in this news release are based upon what management believes to be reasonable assumptions, the Company cannot assure investors that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this news release.
About IBI Group Inc.
IBI Group (TSX:IBG) is a globally integrated architecture, planning, engineering, and technology firm with over 2,200 professionals around the world. For more than 40 years, its dedicated professionals have helped clients create livable, sustainable, and advanced urban environments. IBI Group believes that cities must be designed with intelligent systems, sustainable buildings, efficient infrastructure, and a human touch.
SOURCE: IBI Group Inc.
For further information:
Stephen Taylor, CFO
IBI Group Inc.
55 St. Clair Avenue West
Toronto, ON M4V 2Y7
Bayfield Strategy, Inc.