Canadian information technology and business process services company CGI Group Inc (TSX: GIB.A, NYSE: GIB) has agreed to repurchase 7.1 million Class A subordinate voting shares currently held by the Caisse de dépôt et placement du Québec. Priced at $56.24 per share, the buyback deal is valued at about $400 million. In 2012, the Caisse invested $1 billion in Montréal-based CGI to support the company’s acquisition of the United Kingdom’s Logica Plc. The Caisse said the share repurchase represents a portfolio rebalancing that will leave it with about 16.4 percent of CGI’s total outstanding shares.
CGI to repurchase 7.1 million of its shares held by Caisse de dépôt et placement du Québec
Represents $400 million investment by CGI
Montreal, Quebec, March 3, 2016 – CGI Group Inc. (TSX: GIB.A) (NYSE: GIB) announced today that it has entered into a private agreement with Caisse de dépôt et placement du Québec (“la Caisse”) for the repurchase for cancellation of 7,112,375 of its Class A subordinate voting shares (“Class A Shares”) held by la Caisse for a price of $56.24 per Class A Share, which represents a discount to the closing price of the Class A Shares on the Toronto Stock Exchange (“TSX”) on March 3, 2016.
The transaction is made in connection with the periodic portfolio rebalancing of la Caisse. Once completed, la Caisse will continue to hold approximately 51.0 million Class A Shares, representing approximately 16.4% of CGI’s total outstanding shares.
“CGI continues to deliver a solid performance at all levels and to generate superior returns. We rebalance our portfolio periodically, when the appropriate conditions are in place, in order to capture a portion of these gains for our depositors, said Christian Dubé, Executive Vice-President, Québec, of la Caisse. CGI is very well positioned to continue its growth in markets across the world. This is why la Caisse intends to remain, in the long term, a significant shareholder of this leader in information technologies.”
“This transaction is immediately accretive and in line with our commitment of creating value, having returned some $2.5 billion to shareholders through share repurchases over the last decade,” said Michael E. Roach, President and Chief Executive Officer, CGI. “With readily available access to more than $1.7 billion in capital, we remain very well positioned to continue executing our Build and Buy profitable growth strategy.”
A favorable decision was obtained from the Autorité des marchés financiers to exempt CGI from the issuer bid requirements under securities legislation applicable to the transaction, which is made at a discount in accordance with the decision and will be settled on March 8, 2016. The 2012 Registration Rights Agreement between la Caisse and CGI will also be terminated concurrently with the settlement of the transaction.
The share repurchase will be made under CGI’s normal course issuer bid (“NCIB”), the renewal of which was announced on January 27, 2016. Under the NCIB, CGI is authorized to repurchase up to 21,425,992 Class A Shares by February 3, 2017. The NCIB allows for purchases outside the facilities of the TSX by private agreements pursuant to exemption orders issued by securities regulatory authorities. As at March 3, 2016, no share had been repurchased under the NCIB.
Founded in 1976, CGI Group Inc. is the fifth largest independent information technology and business process services firm in the world. Approximately 65,000 professionals serve thousands of global clients from offices and delivery centers across the Americas, Europe and Asia Pacific, leveraging a comprehensive portfolio of services, including high-end business and IT consulting, systems integration, application development and maintenance and infrastructure management, as well as 150 IP-based services and solutions. With annual revenue in excess of C$10 billion and an order backlog exceeding C$20 billion, CGI shares are listed on the TSX (GIB.A) and the NYSE (GIB). Website: www.cgi.com.
ABOUT CAISSE DE DÉPÔT ET PLACEMENT DU QUÉBEC
Caisse de dépôt et placement du Québec is a long-term institutional investor that manages funds primarily for public and parapublic pension and insurance plans. As at December 31, 2015, it held $248.0 billion in net assets. As one of Canada’s leading institutional fund managers, CDPQ invests globally in major financial markets, private equity, infrastructure and real estate. For more information, visit cdpq.com, follow us on Twitter @LaCDPQ or consult our Facebook or LinkedIn pages.
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