Home Capital Group Inc. (“Home Capital” or the “Company”) (TSX: HCG) announced today the preliminary results of its substantial issuer bid (the “Offer”) to repurchase for cancellation up to C$115,000,000 of its common shares (the “Shares”).
In accordance with the terms and conditions of the Offer and based on a preliminary count by Computershare Investor Services Inc. (the “Depositary”), Home Capital expects to take up and purchase for cancellation 1,547,296 Shares at a purchase price of C$28.60 per Share (the “Purchase Price”). The Shares expected to be purchased under the Offer represent approximately 3.87% of the Shares issued and outstanding (undiluted) as at September 13, 2022. After giving effect to the Offer, 38,397,442 Shares are expected to be issued and outstanding.
Shareholders had the opportunity under the Offer to tender Shares until 5:00 p.m. (Eastern time) on September 13, 2022. The Offer was made by way of a “modified Dutch auction” with Offer prices ranging from C$25.20 to C$28.60 per Share. Based on preliminary results, approximately 1.55 million Shares were tendered under the Offer (including Shares tendered by notice of guaranteed delivery). As the total number of Shares tendered was less than the total that could have been purchased by the Company under the terms of the Offer, all Shares validly deposited and not withdrawn will be purchased under the Offer and no proration will be required.
“We are pleased to continue with our strategy of returning capital to shareholders and making progress toward our stated target capital range,” affirmed Yousry Bissada, President and CEO of Home Capital, “While we were able to return C$44.3 million to participating shareholders, the fact that the tender offer was not fully subscribed indicates that many of our shareholders see the potential for additional upside value in our shares. Given our robust capital levels, we will continue with our efforts to create value through our capital program while retaining sufficient capital to support our business growth and maintain financial flexibility.”
The Company’s offer to purchase relating to the Offer has a condition in section 7(e) relating to acquisition proposals that may be waived by the Company in its sole discretion. The Company has determined to waive this condition in respect of the unsolicited, non-binding and conditional expression of interest received by the Company, as previously announced on August 15, 2022.
The full details of the Offer are described in the offer to purchase and issuer bid circular dated August 8, 2022, as supplemented by the notice of change dated August 18, 2022, as well as the related letter of transmittal and notice of guaranteed delivery, copies of which were filed and are available on SEDAR at www.sedar.com.
The number of Shares to be purchased under the Offer and the Purchase Price are preliminary, subject to verification by the Depositary and assume that all Shares tendered through notice of guaranteed delivery will be delivered within the two trading day settlement period. Home Capital will announce the final results following completion of take-up of the Shares.
This news release is for informational purposes only and does not constitute an offer to buy or the solicitation of an offer to sell Shares.
Caution Regarding Forward Looking Statements
This press release contains forward-looking information within the meaning of applicable Canadian securities legislation, including relating to the Company’s completion of a substantial issuer bid and the size of the substantial issuer bid. Please refer to Home Capital’s 2022 Second Quarter Report, available on Home Capital’s website at www.homecapital.com, and on the Canadian Securities Administrators’ website at www.sedar.com, for Home Capital’s Caution Regarding Forward-looking Statements.
About Home Capital
Home Capital Group Inc. is a public company, traded on the Toronto Stock Exchange (HCG), operating through its principal subsidiary, Home Trust Company. Home Trust is a federally regulated trust company offering residential and non-residential mortgage lending, securitization of residential mortgage products, consumer lending and credit card services. In addition, Home Trust and its wholly owned subsidiary, Home Bank, offer deposits via brokers and financial planners, and through a direct-to-consumer brand, Oaken Financial. Licensed to conduct business across Canada, we have offices in Ontario, Alberta, British Columbia, Nova Scotia, and Quebec.
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