CGI Inc (TSX: GIB.A, NYSE: GIB) has agreed to purchase for cancellation 5.2 million Class A subordinate voting shares held by Caisse de dépôt et placement du Québec (CDPQ) for $96.93 per unit.
The repurchase transaction has a total value of about $500 million.
Once completed, CDPQ will hold an about 13.9 percent interest in CGI, a Montréal-based information technology and business consulting services provider.
In 2012, the Canadian pension fund invested $1 billion in CGI to support its acquisition of European business and technology services company Logica Plc.
CGI announces intent to repurchase 5.16 million of its shares held by Caisse de dépôt et placement du Québec
Represents $500.0 million transaction by CGI
MONTRÉAL, June 11, 2019 /CNW Telbec/ – CGI (TSX: GIB.A) (NYSE: GIB) announced today that it intends to enter into a private agreement with Caisse de dépôt et placement du Québec (“la Caisse”) for the purchase for cancellation of 5,158,362 of its Class A subordinate voting shares (“Class A Shares”) held by la Caisse for a price of $96.93 per Class A Share, which represents a discount to today’s closing price of the Class A Shares on the Toronto Stock Exchange (“TSX”).
The transaction will be made in connection with the periodic portfolio rebalancing of la Caisse. Once completed, la Caisse will continue to hold approximately 37.4 million Class A Shares, representing approximately 13.9 % of CGI’s total outstanding shares.
“CDPQ rebalances its portfolio periodically, during the right conditions. CGI has delivered excellent results for its shareholders, and this transaction is an opportunity to monetize a portion of our investment in the company to the benefit of our depositors,” said Charles Émond, Executive Vice-President and Head of Québec Investments and Global Strategic Planning at CDPQ. “Following this transaction, we will continue as a significant shareholder of the company, and given the long-term nature of this investment, we intend to remain so to support the growth of this information technology leader. CGI is well positioned to continue its success at home and in international markets.”
“This transaction is immediately accretive and consistent with our value creation strategy,” said François Boulanger, Executive Vice-President and Chief Financial Officer, CGI. “We remain very well positioned to continue executing our Build and Buy profitable growth strategy through our strong cash flow generation and access to our credit facility.”
A favourable 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 will be made at a discount in accordance with the decision and is expected to be entered into later today and settled on June 13, 2019.
The share repurchase will be made under CGI’s normal course issuer bid (“NCIB”), the renewal of which was announced on January 30, 2019. Under the NCIB, CGI is authorized to repurchase up to 20,100,499 Class A Shares by February 5, 2020. The NCIB allows for purchases outside the facilities of the TSX by private agreements pursuant to exemption orders issued by securities regulators. As at June 11, 2019, 573,070 shares had been repurchased under the NCIB.
Information regarding the share repurchase, including the number of Class A Shares purchased for cancellation and aggregate price paid, will be available on the SEDAR website at sedar.com following the completion thereof. CGI will not issue any additional press release in respect of this share repurchase.
Founded in 1976, CGI is among the largest independent IT and business consulting services firms in the world. With approximately 77,000 consultants and professionals across the globe, CGI delivers an end-to-end portfolio of capabilities, from IT and business consulting to systems integration, outsourcing services and intellectual property solutions. CGI works with clients through a local relationship model complemented by a global delivery network that helps clients digitally transform their organizations and accelerate results. With Fiscal 2018 reported revenue of C$11.5 billion, CGI shares are listed on the TSX (GIB.A) and the NYSE (GIB). Learn more at cgi.com.
About Caisse de dépôt et placement du Québec
Caisse de dépôt et placement du Québec (CDPQ) is a long-term institutional investor that manages funds primarily for public and parapublic pension and insurance plans. As at December 31, 2018, it held CA$309.5 billion in net assets. As one of Canada’s leading institutional fund managers, CDPQ invests globally in major financial markets, private equity, infrastructure, real estate and private debt. CDPQ is present in India through its subsidiary CDPQ India, located in New Delhi. For more information, visit cdpq.com, follow us on Twitter @LaCDPQ or consult our Facebook or LinkedIn pages.
For further information: CGI, Lorne Gorber, Executive Vice-President, Investor and Public Relations, +1-514-841-3355, email@example.com; Caisse de dépôt et placement du Québec, Jean-Benoît Houde, Senior Advisor, Media Relations, +1-514-847-5493, firstname.lastname@example.org