Caisse de dépôt et placement du Québec and Fonds de solidarité FTQ have agreed to join the take-private acquisition of Canam Group Inc (TSX: CAM) as equity investors. The deal, announced last month, will see Canam acquired by U.S. private equity firm American Industrial Partners (AIP) and the Dutil family for $875 million, including debt. The Caisse and Fonds, existing investors in Canam, will with Dutil shareholders own up to 40 percent of the company’s equity with the deal’s close, while AIP will hold the majority share. Based in Saint-Georges, Québec, Canam is a maker of customized products for the construction industry.
Canam Group announces participation by Caisse de dépôt et placement du Québec and Fonds de solidarité FTQ in going-private transaction led by the Dutil family, issuance of interim order and holding of a special meeting of shareholders
SAINT-GEORGES, QC, May 11, 2017 /CNW Telbec/ – Canam Group Inc. (TSX: CAM) (“Canam” or the “Corporation”) today announced that Caisse de dépôt et placement du Québec (“Caisse”) and Fonds de solidarité FTQ (“Fonds”) will be participating as equity investors in the going-private transaction of the Corporation led by members of the Dutil family (collectively, the “Dutil Shareholders”, and, together with Caisse and Fonds, the “Rollover Shareholders”) and involving American Industrial Partners (“AIP”), which was announced on April 27, 2017.
Pursuant to the transaction to be implemented by way of a statutory plan of arrangement under the Business Corporations Act (Québec) (the “Arrangement”), Canaveral Acquisition Inc. (the “Purchaser”), a company to be held by AIP and the Rollover Shareholders, will acquire all of the outstanding common shares of the Corporation (the “Shares”), except for the Shares to be contributed directly or indirectly by the Rollover Shareholders to the Purchaser (the “Rollover Shares”) in exchange for shares of the Purchaser, for a cash consideration of $12.30 per Share.
The price of $12.30 per Share represents a premium of 98.4% to the closing price of the Shares on the Toronto Stock Exchange on April 26, 2017 and a premium of 91.0% over the 20-day volume weighted average price of the Shares up to and including April 26, 2017, being the last trading day prior to the date on which the Arrangement was announced.
In connection with the Arrangement, the Dutil Shareholders, Caisse and Fonds have entered into agreements with the Purchaser pursuant to which they have agreed to contribute cash and equity to the Purchaser. It is expected that the Dutil Shareholders, Caisse and Fonds would own as much as 40% of equity in the Purchaser upon closing of the Arrangement, with AIP owning a majority of the equity in the Purchaser and controlling its board of directors.
The Dutil Shareholders, Caisse, Fonds and the directors and executive officers of the Corporation have entered into support and voting agreements pursuant to which they have agreed to support the Arrangement and vote or cause to be voted all of the Shares beneficially owned by them in favour of the Arrangement Resolution and against any resolution that is inconsistent therewith. The support and voting agreements of the Dutil Shareholders are irrevocable for a period of 180 days following April 27, 2017. Consequently, Shareholders beneficially holding approximately 29.32% of the outstanding Shares have agreed to vote or cause to be voted all of their Shares in favour of the Arrangement Resolution.
Interim Order and Special Meeting
The Corporation also announced that the Québec Superior Court has issued an interim order authorizing, among other things, the holding of a special meeting (the “Special Meeting”) of the holders of Shares. At the Special Meeting, the holders of Shares (collectively, the “Shareholders”) will be asked to pass a special resolution approving the Arrangement (the “Arrangement Resolution”).
Pursuant to the interim order, the Special Meeting will be held on June 13, 2017 at 11:00 a.m. (Eastern Daylight Time) at the Georgesville Convention Center, located at 300, 118e Rue, Saint-Georges, Québec G5Y 3E3, and Shareholders of record as of the close of business on May 4, 2017 will be entitled to receive notice of, to attend, and to vote at the Special Meeting or any adjournments or postponements thereof. Canam expects to begin the mailing of its management information circular on or about May 17, 2017, at which time it will also be available under the profile of Canam at www.sedar.com.
The Arrangement is subject to court approval and the approval of at least (i) two-thirds of the votes cast by the Shareholders present in person or represented by proxy at the Special Meeting and entitled to vote and (ii) the approval of a simple majority of the votes cast by the Shareholders present in person or represented by proxy at the Special Meeting and entitled to vote other than the Dutil Shareholders, Caisse and Fonds.
The Board of Directors of Canam (the “Board of Directors”), after receiving the fairness opinions of BMO Capital Markets and Deloitte LLP, the formal valuation of Deloitte LLP, legal and financial advice and the recommendation of the special committee of the Board of Directors comprised solely of independent directors, has unanimously (with Marcel Dutil, Marc Dutil and Anne-Marie Dutil Blatchford abstaining from voting) determined that the Arrangement Resolution is in the best interests of the Corporation and unanimously (with Marcel Dutil, Marc Dutil and Anne-Marie Dutil Blatchford abstaining from voting) recommends that the Shareholders (other than the Dutil Shareholders, and Caisse and Fonds) vote in favour of the Arrangement Resolution.
About Canam Group Inc.
Canam specializes in designing integrated solutions and fabricating customized products for the North American construction industry. Each year, Canam takes part in an average of 10,000 building, structural steel and bridge projects, which can also include the supply of preconstruction, project management and erection services. The Corporation operates 23 plants across North America and employs over 4,650 people in Canada, the United States, Romania and India.
About American Industrial Partners
American Industrial Partners is an operationally oriented middle-market private equity firm that makes control investments in North American-based industrial businesses serving domestic and global markets. The firm has deep roots in the industrial economy and has been active in private equity investing since 1989. To date, American Industrial Partners has completed over 70 platform and add-on transactions and currently has US$4.1 billion of assets under management on behalf of leading pension, endowment and financial institutions. American Industrial Partners invests in all forms of corporate divestitures, management buyouts, recapitalizations, and going-private transactions of established businesses with leading market shares with revenues of between US$200 million to US$2 billion.
About Caisse de dépôt et placement du Québec
Caisse is a long-term institutional investor that manages funds primarily for public and parapublic pension and insurance plans. As at December 31, 2016, Caisse held $270.7 billion in net assets. As one of North America’s leading institutional fund managers, Caisse invests globally in major financial markets, private equity, infrastructure and real estate.
About Fonds de solidarité FTQ
The Fonds de solidarité FTQ is a development capital fund that channels the savings of Quebecers into investments. As at November 30, 2016, the organization had $12.2 billion in net assets, and through its current portfolio of investments has helped create and protect over 187,000 jobs. The Fonds is a partner in more than 2,600 companies and has nearly 618,000 shareholder-savers. For more information, visit fondsftq.com.
For further information: François Bégin, Vice President, Communications, Canam Group Inc., 418-228-8031/ 418-225-1355 (mobile phone), firstname.lastname@example.org
Photo courtesy of Canam Group Inc