Oaktree-backed Neo Performance closes secondary offering

Neo Performance Materials, a Toronto-based advanced materials supplier, completed a previously announced secondary offering of its common shares, raising C$90.85 million.

Neo Performance Materials, a Toronto-based advanced materials supplier, completed a previously announced secondary offering of its common shares, raising C$90.85 million. The seller is US distressed investor Oaktree Capital Management, the company’s largest shareholder. The sale reduces Oaktree’s interest to about 33.2 percent.

PRESS RELEASE

TORONTO, April 27, 2021 /CNW/ – Neo Performance Materials Inc. (“Neo”, the “Company”) (TSX: NEO) is pleased to announce that it has completed the previously announced secondary offering (the “Offering”) of common shares of the Company (the “Common Shares”) (see press release dated April 6, 2021). A fund managed by Oaktree Capital Management, L.P. (the “Selling Shareholder”) sold an aggregate of 4,600,000 Common Shares under the Offering at a price of $19.75 per share for total gross proceeds to the Selling Shareholder of $90.85 million, including the full exercise of the over-allotment option. The Company has not and will not receive any of the proceeds of the Offering.

The Offering was made, on a bought deal basis, pursuant to an underwriting agreement dated April 12, 2021 among the Company, the Selling Shareholder and Paradigm Capital Inc., as lead underwriter, RBC Dominion Securities Inc., Canaccord Genuity Corp., Cormark Securities Inc., Raymond James Ltd., Scotia Capital Inc. and Stifel Nicolaus Canada Inc. (collectively, the “Underwriters”).
Following completion of the Offering, the Selling Shareholder holds an aggregate of 12,509,155 Common Shares, representing approximately 33.2% of the issued and outstanding Common Shares. The Selling Shareholder and its affiliates have agreed with the Underwriters that their remaining Common Shares of the Company will be subject to a 120-day lock-up period, subject to customary exceptions.

In connection with the Offering, the Underwriters received a cash commission equal to 5% of the gross proceeds of the Offering.
The Common Shares were offered by way of a short form prospectus in all of the provinces of Canada other than Quebec. Private placement offerings in the United States were made to “qualified institutional buyers” pursuant to Rule 144A of the United States Securities Act of 1933.

The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.

About Neo Performance Materials
Neo manufactures the building blocks of many modern technologies that enhance efficiency and sustainability. Neo’s advanced industrial materials – magnetic powders and magnets, specialty chemicals, metals, and alloys – are critical to the performance of many everyday products and emerging technologies. Neo’s products help to deliver the technologies of tomorrow to consumers today. The business of Neo is organized along three segments: Magnequench, Chemicals & Oxides and Rare Metals. Neo is headquartered in Toronto, Ontario, Canada; with corporate offices in Greenwood Village, Colorado, US; Singapore; and Beijing, China. Neo operates globally with sales and production across 10 countries, being Japan, China, Thailand, Estonia, Singapore, Germany, United Kingdom, Canada, United States, and South Korea. For more information, please visit www.neomaterials.com.

About Oaktree
Oaktree is a leader among global investment managers specializing in alternative investments, with $148 billion in assets under management as of December 31, 2020. The firm emphasizes an opportunistic, value-oriented and risk-controlled approach to investments in credit, private equity, real assets and listed equities. The firm has over 1,000 employees and offices in 19 cities worldwide. For additional information, please visit Oaktree’s website at http://www.oaktreecapital.com/.