Bombardier upsizes equity financing to C$938 million

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By admin February 23, 2015 14:44

Bombardier upsizes equity financing to C$938 million

Bombardier has amended the terms of its previously announced bought deal equity offering to increase the size of the offering from C$750 million to approximately C$938 million (US$750 million).

Under the terms of the Upsized Offering, a syndicate of underwriters, led by National Bank Financial, UBS Securities Canada, CIBC and Citigroup Global Markets Canada has agreed to purchase on a bought deal basis from Bombardier and sell to the public in Canada 424,209,000 subscription receipts exchangeable for Class B shares (subordinate voting) of Bombardier.  Bombardier has also granted the underwriters an option to purchase up to an additional 63,631,350 Subscription Receipts or the underlying Class B Subordinate Voting Shares, as applicable, at any time up to 30 days after closing of the Upsized Offering. The Upsized Offering is subject to the receipt of all necessary regulatory and stock exchange approvals.

Closing of the Upsized Offering is expected to occur on or about February 27, 2015.  As part of the Upsized Offering, certain members of the Bombardier family have confirmed to Bombardier that they will, directly or through holding corporations controlled by them, place orders for Subscription Receipts for an aggregate investment amount equal to the C$ equivalent of US$50 million.

The purchase price of C$2.21 per Subscription Receipt will result in gross proceeds of approximately C$938 million (or approximately C$1.08 billion if the underwriters’ overallotment option is exercised in full).  As Bombardier is not currently authorized to issue a sufficient number of its Class B Subordinate Voting Shares, such proceeds will be held by an escrow agent pending, among other things, receipt of all approvals (including shareholder approval) required to amend the articles of Bombardier to increase the number of Class A shares (multiple voting) and Class B Subordinate Voting Shares Bombardier is authorized to issue from 1,892,000,000 to 2,742,000,000.

As previously announced, a special meeting of shareholders has been convened and will take place on March 27, 2015, for the purpose of approving by special resolution the proposed amendment to the articles of Bombardier.  In the event the special resolution is duly adopted by shareholders, the amendment to the articles of Bombardier is expected to become effective on or about March 27, 2015 and the net proceeds of the Upsized Offering released to Bombardier at such time.  Certain members of the Bombardier family currently exercising control or direction over 266,863,185 Class A shares (multiple voting) and 2,712,776 Class B shares (subordinate voting), representing 58.24% of the total votes attached to the Class A shares (multiple voting) and Class B Subordinate Voting Shares, have agreed to vote in favour of the resolution approving the amendment of the articles of the Corporation.

Each Subscription Receipt will entitle the holder thereof to receive, on satisfaction of the Release Condition, and without payment of additional consideration, one Class B Subordinate Voting Share. In the event that the Release Condition is not satisfied prior to 5:00 p.m. (Montreal time) on April 30, 2015, holders of Subscription Receipts will be entitled to receive an amount equal to the full subscription price thereof plus their pro rata share of the interest earned or other income generated on such amount. The net proceeds of the Upsized Offering will be used by Bombardier to supplement its working capital and for general corporate purposes.

admin
By admin February 23, 2015 14:44