IBI Group Inc. Announces $35 Million Bought Deal Financing
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Toronto, ON /Marketwired/ August 25, 2016/ – IBI Group Inc. (the “Company”) (TSX:IBG) announced today that it has entered into an agreement with a syndicate of underwriters (the “Underwriters”) led by National Bank Financial Inc., CIBC World Markets Inc. and TD Securities Inc. pursuant to which the Company will issue on a “bought deal” basis $35,000,000 aggregate principal amount of convertible unsecured subordinated debentures (the “Debentures”) at a price of $1,000 per principal amount of Debentures (the “Offering”). In addition, the Company has granted the Underwriters an over-allotment option to purchase up to an additional $5,250,000 aggregate principal amount of Debentures at the same price, exercisable in whole or in part at any time for a period of up to 30 days following closing of the Offering, to cover over-allotments.
The Debentures will bear interest from the date of closing at 5.50% per annum, payable semi-annually in arrears on June 30 and December 31 each year commencing June 30, 2017. The Debentures will have a maturity date of December 31, 2021 (the “Maturity Date”).
The net proceeds of the Offering will be used to fund the partial redemption of the Company’s 6.0% convertible debentures maturing on June 30, 2018 (the “2018 Debentures”) and for general corporate purposes. Prior to redeeming the 2018 Debentures, the Company may use a portion of the net proceeds of the Offering to repay existing indebtedness under the Company’s senior credit facility, which amount will then be available to be drawn, as required, to fund the partial redemption of the 2018 Debentures.
The Debentures will be convertible at the holder’s option at any time prior to the close of business on the earlier of the Maturity Date and the business day immediately preceding the date specified by the Company for redemption of the Debentures into common shares of the Company (“Common Shares”) at a conversion price of approximately $8.35 per Common Share, being a conversion rate of 119.7605 Common Shares for each $1,000 principal amount of Debentures, subject to adjustment as provided in the indenture governing the Debentures. The Debentures will not be redeemable prior to December 31, 2019. On or after December 31, 2019 and prior to December 31, 2020, the Debentures may be redeemed in whole or in part at the option of the Company on not more than 60 days and not less than 30 days prior notice at a price equal to their principal amount thereof plus accrued and unpaid interest, provided that the volume weighted average trading price of the Common Shares on the TSX for the 20 consecutive trading days ending five trading days preceding the date on which the notice of redemption is given is not less than 125% of the Conversion Price. On or after December 31, 2020 and prior to the Maturity Date, the Debentures may be redeemed in whole or in part at the option of the Company on not more than 60 days and not less than 30 days prior notice at a price equal to their principal amount plus accrued and unpaid interest.
Closing of the Offering is expected to occur on or about September 15, 2016. The Offering is subject to normal regulatory approvals, including approval of the Toronto Stock Exchange of the listing of the Debentures and the Common Shares to be issued upon conversion of the Debentures. The Debentures will be offered in each of the provinces and territories of Canada by way of a short form prospectus, and by way of private placement in the United States to Qualified Institutional Buyers pursuant to Rule 144A.
CAUTION REGARDING FORWARD-LOOKING INFORMATION
Certain statements in this news release may constitute “forward-looking” statements which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company and its subsidiary entities, including 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. When used in this news release, such statements use words such as “may”, “will”, “expect”, “believe”, “plan” and other similar terminology. These statements reflect management’s current expectations regarding future events and operating performance and speak only as of the date of this news release. These forward- looking statements involve a number of risks and uncertainties, including those related to: (i) the impact of general economic conditions; (ii) industry conditions; (iii) stock market volatility; and (iv) the failure or delay in satisfying any of the conditions to the completion of the Offering, many of which are beyond the Company’s control. For an augmented discussion of the risk factors and uncertainties that affect or may affect the Company, the reader is directed to the section entitled “Risk Factors” in the Company’s Annual Information Form for the year ended December 31, 2015. 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 at August 25, 2016.
About IBI Group Inc.
IBI Group Inc. (TSX:IBG) is a globally integrated architecture, planning, engineering, and technology firm with over 2,500 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.
For further information:
Stephen Taylor, CFO
IBI Group Inc.
55 St. Clair Avenue West
Toronto, ON M4V 2Y7
Bayfield Strategy, Inc.