NEWSSSSSSSSSSSSGlobe/CP say RailPower soars on deal with new owners
2007-11-13 08:09 ET - In the News
The Globe and Mail reports in a Canadian Press dispatch Tuesday that shares of RailPower Technologies added 19 cents to close at 42 cents Monday after the Ontario Teachers' Pension Plan agreed to invest $35-million in the troubled maker of environmentally friendly locomotives. The unbylined item says the stock rocketed higher after an announcement of a deal after the close of markets Friday that could make the pension fund the company's largest shareholder. Under the deal, the $35-million investment will include a five-year convertible debenture with an annual interest rate of 5 per cent, payable semi-annually in cash or shares. The convertible at 30 cents represents up to 116.7 million shares. RailPower has 89.5 million shares outstanding. The deal need RailPower shareholder approval. "With this investment, we now have a strong financial partner to ensure RailPower's future growth and success," said Jose Mathieu, chief executive officer of RailPower. In June, RailPower recalled dozens of its Green Goat yard switcher locomotives after a fire in one, prompting the company to take a $15-million charge. For the three months ended June 30, it lost $33.7-million on $37.3-million in revenue.