TORONTO, July 4, 2013 /CNW/ - MCAN Mortgage Corporation (TSX:MKP)
("MCAN", the "Company" or "we") and Xceed Mortgage Corporation
(TSX:XMC) ("Xceed") are pleased to announce today that the previously
announced acquisition of each of the issued and outstanding common
shares of Xceed ("Xceed Shares") pursuant to a court-approved plan of arrangement under the Business Corporations Act (Ontario) (the "Arrangement") has closed. Xceed is now a wholly owned
subsidiary of MCAN.
Pursuant to the Arrangement, holders of Xceed Shares were entitled to
elect to receive Cdn$1.75 in cash or 0.118 of a common share of MCAN
(the "MCAN Shares") for each Xceed Share held, subject to pro-ration. Pursuant to
the elections or deemed elections of holders of Xceed Shares and after
giving effect to pro-rationing in accordance with the Arrangement, in
consideration for the transfer of Xceed Shares, MCAN paid aggregate
cash consideration equal to $30,292,062.50, and issued 1,531,903 MCAN
Shares, to the holders of Xceed Shares.
The Xceed Shares will cease to be listed on the Toronto Stock Exchange
on or about the close of business on July 8, 2013. Following the
delisting of the Xceed Shares, Xceed will apply to the relevant
securities regulatory authorities to cease being a reporting issuer in
all of the provinces of Canada in which it is currently a reporting
issuer.
"MCAN is pleased to have completed its acquisition of Xceed," said
William Jandrisits, MCAN's President and Chief Executive Officer. "We
look forward to integrating the two companies to achieve value for our
shareholders. New capital received as part of this transaction allows
approximately $120 million of new capacity for MCAN to grow."
Material change reports relating to the Arrangement will be filed with
the Canadian securities regulators and will be available under MCAN's
and Xceed's respective profiles on SEDAR at www.sedar.com. MCAN's material change report will also be available on MCAN's website
at www.mcanmortgage.com.
Forward-Looking Information
This press release may contain forward-looking statements, including
statements regarding certain strategic benefits and operational,
competitive and cost efficiencies expected to result from the
Arrangement. These forward-looking statements can generally be
identified as such because of the context of the statements and often
include words such as "believes", "anticipates", "expects", "plans",
"estimates" or words of a similar nature. These statements are based
on current expectations, and are subject to a number of risks and
uncertainties that may cause actual results to differ materially from
those contemplated by the forward-looking statements. Some of the
factors that could cause such differences include legislative or
regulatory developments, competition, technology change, global market
activity, interest rates, changes in government and economic policy and
general economic conditions in geographic areas where MCAN and Xceed
operate. Reference is made to the risk factors disclosed in MCAN's
Annual Information Form dated March 26, 2013 which are incorporated
herein by reference. Reference is also made to the risk factors
disclosed in Xceed's management proxy circular dated April 23, 2013.
These and other factors should be considered carefully and undue
reliance should not be placed on MCAN's or Xceed's forward-looking
statements. Subject to applicable securities law requirements, neither
MCAN nor Xceed undertakes to update any forward-looking statements.
About MCAN
MCAN is a public company listed on the TSX under the symbol MKP and is a
reporting issuer in all provinces and territories in Canada. MCAN also
qualifies as a mortgage investment corporation ("MIC") under the Income Tax Act (Canada) (the "Tax Act").
MCAN's primary objective is to generate a reliable stream of income by
investing its corporate funds in a portfolio of mortgages (including
single family residential, residential construction, non-residential
construction and commercial loans), as well as other types of financial
investments, loans and real estate investments. MCAN employs leverage
by issuing term deposits eligible for Canada Deposit Insurance
Corporation ("CDIC") deposit insurance up to a maximum of five times
capital (on a non-consolidated tax basis) as permitted by the Tax Act.
The term deposits are sourced through a network of independent
financial agents. As a MIC, MCAN is entitled to deduct from income for
tax purposes 100% of dividends, except for capital gains dividends,
which are deducted at 50%. Such dividends are received by the
shareholders as interest income and capital gains dividends,
respectively.
MCAN also participates in the Canada Mortgage Bonds program, and other
securitizations of insured mortgages.
About Xceed Mortgage
Xceed Mortgage Corporation, based in Toronto, is a Canadian provider of
residential mortgages that it originates in Canada. Xceed has
approximately $0.8 billion of mortgages under administration.
SOURCE: MCAN Mortgage Corporation
