BOUGHT DEAL FINANCING OF $120 MILLION OF COMMON SHARES, $150 MILLION OF CONVERTIBLE UNSECURED SUBORDINATED DEBENTURES AND A CONCURRENT $30 MILLION PRIVATE PLACEMENT FROM CPP INVESTMENTS
NOT FOR DISTRIBUTION TO U.S. NEWS SERVICES OR DISSEMINATION IN THE UNITED STATES
VANCOUVER, British Columbia, June 25, 2020 (GLOBE NEWSWIRE) -- Premium Brands Holdings Corporation (“Premium Brands” or the “Company”) (TSX: PBH), a leading producer, marketer and distributor of branded specialty food products, is pleased to announce that it has entered into an agreement with National Bank Financial Inc, BMO Capital Markets, CIBC Capital Markets, Cormark Securities Inc. and Scotiabank acting as joint bookrunners, on behalf of a syndicate of underwriters (collectively, the “Underwriters”), pursuant to which the Company will issue, from treasury on a "bought-deal" basis, 1,391,000 common shares (the “Shares”) at a price of $86.30 per share (the “Share Issue Price”), for gross proceeds of approximately $120 million (the “Share Offering”) and $150 million aggregate principal amount of convertible unsecured subordinated debentures (the “Debentures”) at a price of $1,000 per Debenture (the “Debenture Offering”) (collectively, the “Offerings”).
In addition, Premium Brands has entered into an agreement under which the Company will complete a private placement of common shares at the Share Issue Price with Canada Pension Plan Investment Board (“CPP Investments”), for aggregate gross proceeds to the Company of approximately $30 million (the “Private Placement”).
The Company intends to use the net proceeds of the Offerings and the Private Placement for general corporate purposes as well as to fund potential future acquisition opportunities.
The Debentures will bear interest from the date of issue at 4.20% per annum, payable semi‐annually in arrears on March 31 and September 30 each year commencing March 31, 2021, and each will have a maturity date of September 30, 2027 (the “Maturity Date”). 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 at a conversion price of $142.40 per common share, being a conversion rate of 7.0227 common shares for each $1,000 principal amount of Debentures.
The Company has granted the Underwriters (i) an over-allotment option (the “Share Over-Allotment Option”) to purchase additional Shares on the same terms, representing up to 15% of the size of the Share Offering, exercisable in whole or in part at any time for a period of up to 30 days following closing of the Share Offering, to cover over-allotments, if any, and (ii) an over-allotment option (the “Debenture Over-Allotment Option”) to purchase up to an additional $22.5 million aggregate principal amount of Debentures, on the same terms, exercisable in whole or in part at any time for a period of up to 30 days following closing of the Debenture Offering, to cover over-allotments, if any. CPP Investments has also been granted an option (the “Additional Subscription Option”) to purchase a number of additional common shares representing up to 15% of the number of shares subscribed by them, , such option to be exercised and closed not later than 45 days from the date hereof. If each of the Share Over-Allotment Option, Debenture Over-Allotment Option and Additional Subscription Option is exercised in full, the Company will receive additional gross proceeds of $45 million, for aggregate gross proceeds from the Offerings and the Private Placement of $345 million.
“The successful completion of the Offerings and Private Placement will further strengthen our balance sheet as well as our ability to pursue our pipeline of acquisition opportunities. We are also very pleased with the continued support from our long-term partner CPP Investments,” commented George Paleologou, President and CEO of Premium Brands.
Closing of the Offerings is expected to occur on or about July 16, 2020. The Offerings are subject to normal regulatory approvals, including approval of the Toronto Stock Exchange.
The Shares and Debentures issued pursuant to the Offerings 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 or in such a manner as to not require registration under the United States Securities Act of 1933, as amended.
ABOUT PREMIUM BRANDS
Premium Brands owns a broad range of leading specialty food manufacturing and differentiated food distribution businesses with operations across Canada and the United States.
For further information, please contact George Paleologou, President and CEO or Will Kalutycz, CFO at (604) 656-3100.
www.premiumbrandsholdings.com
The securities to be offered have not been and will not be registered under the United States Securities Act of 1933, as amended, or under any state securities laws, and may not be offered, sold, directly or indirectly, or delivered within the United States of America and its territories and possessions or to, or for the account or benefit of, United States persons except in certain transactions exempt from the registration requirements of such Act. This release does not constitute an offer to sell or a solicitation to buy such securities in the United States, Canada or in any other jurisdiction where such offer is unlawful.
