Oaktree-backed Neo Performance wraps up C$100m offering

Neo Performance Materials, a Toronto-based advanced materials supplier, completed a previously announced treasury and secondary offering, raising more than C$100 million. US distressed investor Oaktree Capital Management, the company’s largest shareholder, accounted for about C$51 million of secondary proceeds, reducing its stake to about 24.3 percent.

PRESS RELEASE

TORONTO, Nov. 16, 2021 /CNW/ – Neo Performance Materials Inc. (“Neo”, the “Company”) (TSX: NEO) is pleased to announce that it has completed the previously announced treasury and secondary offering (the “Offering”) of common shares of the Company (the “Common Shares”) (see press release dated October 25, 2021). The Company issued and sold from treasury an aggregate of 2,598,000 Common Shares at a price of $19.25 per share for total gross proceeds to the Company of approximately $50.01 million. A fund managed by Oaktree Capital Management, L.P. (“Oaktree” or the “Selling Shareholder”) sold an aggregate of 2,631,000 Common Shares under the Offering at a price of $19.25 per share for total gross proceeds to the Selling Shareholder of approximately $50.65 million, including the exercise of the over-allotment option.

The Offering was made, on a bought deal basis, pursuant to an underwriting agreement dated October 29, 2021 among the Company, the Selling Shareholder and Paradigm Capital Inc. and Canaccord Genuity Corp., as lead underwriters, and 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 9,878,155 Common Shares, representing approximately 24.3% of the issued and outstanding Common Shares. Each of the directors and executive officers of the Company and the Selling Shareholder and its affiliates have agreed with the Underwriters that the Common Shares held by each of them 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.