AutoCanada Prices Previously Announced Private Offering of $125,000,000 Senior Notes
EDMONTON, Jan. 31, 2020 /CNW/ - AutoCanada Inc. ("AutoCanada" or the "Company") (TSX: ACQ) is pleased to announce that it has priced its previously announced private placement of $125 million 5-year Senior Unsecured Notes (the "Notes"). Interest on the Notes will accrue at the rate of 8.75% per annum and will be payable semi-annually in arrears in equal semi-annual installments on February 11 and August 11 of each year, beginning on August 11, 2020. The Notes are being sold at a price of 99.011% and will mature on February 11, 2025.
Paul Antony, Executive Chairman of the Company, added, "We are very pleased with the outcome of the offering and support from investors upon hearing of the progress on both the Go Forward initiatives in Canada and the U.S., and improvements made to the balance sheet."
The Notes are being offered and sold to "accredited investors" in certain provinces of Canada and to non-U.S. persons on a private placement basis.
On January 28, 2020, the Company announced that it had launched an offer (the "Tender Offer") to purchase for cash all of the Company's outstanding 5.625% Senior Notes due May 25, 2021 (the "2021 Notes"). AutoCanada expects to use the net proceeds from the sale of the Notes together with additional borrowings under the Company's recently announced amended credit facility to fund purchases of the 2021 Notes under the Tender Offer, including the redemption of any 2021 Notes that remain outstanding after the completion of the Tender Offer.
Subject to the receipt of all necessary approvals and the satisfaction of customary conditions, the private placement of the Notes is expected to close on February 11, 2020.
AutoCanada is a leading North American multi-location automobile dealership group currently operating 63 franchised dealerships, comprised of 27 brands, in eight provinces in Canada as well as a group in Illinois, USA and has over 4,200 employees. AutoCanada currently sells Chrysler, Dodge, Jeep, Ram, FIAT, Alfa Romeo, Chevrolet, GMC, Buick, Cadillac, Ford, Infiniti, Nissan, Hyundai, Subaru, Audi, Volkswagen, Kia, Mazda, Mercedes-Benz, Smart, BMW, MINI, Volvo, Toyota, Lincoln, and Honda branded vehicles. In 2018, our dealerships sold approximately 66,000 vehicles and processed approximately 915,000 service and collision repair orders in our 1,157 service bays generating revenue in excess of $3 billion.
Certain statements contained in this press release are forward-looking statements and information (collectively, "forward-looking statements") within the meaning of the applicable Canadian securities legislation. We hereby provide cautionary statements identifying important factors that could cause our actual results to differ materially from those projected in these forward-looking statements. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, through the use of words or phrases such as "will likely result", "are expected to", "will continue", "is anticipated", "projection", "vision", "goals", "objective", "target", "schedules", "outlook", "anticipate", "expect", "estimate", "could", "should", "plan", "seek", "may", "intend", "likely", "will", "believe" and similar expressions) are not historical facts and are forward looking. In particular, this press release contains forward-looking statements with respect to, among other things, the timing and completion of the private placement of the Notes and the Company's use of proceeds from the offering.
The forward-looking statements included in this press release are not guarantees of future performance and should not be unduly relied upon. Readers are cautioned that forward-looking statements are based on current expectations, estimates and projections that, by their nature, forward-looking statements involve a number of known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated and described in the forward-looking statements. These known and unknown risks and uncertainties include, but are not limited to: the closing of the private placement is subject to a number of customary conditions and there can be no guarantee that such conditions will be met.
Forward-looking statements involve estimates and assumptions and are subject to risks, uncertainties and other factors some of which are beyond our control and difficult to predict. Accordingly, actual results or outcomes may differ materially from those expressed in the forward-looking statements.
AutoCanada cautions that the foregoing list of assumptions, risks and uncertainties is not exhaustive. The Company's Annual Information Form and other documents filed with securities regulatory authorities (accessible through the SEDAR website at www.sedar.com) describe the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference. The forward-looking statements contained in this press release speak only as of the date hereof and AutoCanada assumes no obligation to publicly update or revise them to reflect new events or circumstances, except as may be required pursuant to applicable securities laws.
SOURCE AutoCanada Inc.