/THIS NEWS RELEASE IS NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE
SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/
MONCTON, NB, Sept. 30, 2011 /CNW/ - Major Drilling Group International
Inc. ("Major Drilling" or the "Corporation") (TSX: MDI) is pleased to announce that it has completed the
acquisition (the "Acquisition") of Bradley Group Limited ("Bradley Group"), a drilling company based in Rouyn Noranda, Quebec (Canada). The
purchase price (the "Purchase Price") payable in connection with the Acquisition was $80 million, subject
to customary adjustments, of which $72 million was paid at closing with
the balance of $8 million being subject to a hold-back over 3 years.
Through the Acquisition, Major Drilling has added Bradley Group's 124
rigs to its base of 577 rigs. The addition of Bradley Group's rigs,
approximately 80% of which are surface drilling rigs and approximately
20% of which are underground diamond drilling rigs, furthers the
Corporation's strategic focus on specialized drilling. Also, the
Acquisition involves the addition of Bradley Group's highly experienced
workforce of approximately 860 employees, experienced management team
and existing contracts in Canada, Philippines, Colombia, Mexico and
Suriname. Subsequent to the Acquisition, Major Drilling will have a
total fleet of 701 rigs and approximately 5,220 employees.
In conjunction with the Acquisition, the Corporation also announces the
closing of $100 million of new and extended credit facilities for a
five-year term from its existing lenders, The Bank of Nova Scotia and
The Toronto-Dominion Bank. These credit facilities replace the
Corporation's existing facilities.
The portion of the Purchase Price payable on the closing of the
Acquisition was financed using the net proceeds of the Corporation's
previously announced equity offering of approximately $70 million of
subscription receipts (the "Subscription Receipts") exchangeable for common shares underwritten by a syndicate of
underwriters led by TD Securities Inc., which closed on September 28,
2011, and a portion of the proceeds available under the new and
extended credit facilities.
Exchange of Subscription Receipts
With today's closing of the Acquisition, the escrow release condition
for the Subscription Receipts has been met and the Subscription
Receipts will automatically be exchanged on a one-to-one basis for
common shares of Major Drilling. No dividend equivalent payment is
payable to holders of Subscription Receipts as no record date for any
dividend declared by the Corporation on its common shares has passed
since the issuance of the Subscription Receipts.
About Major Drilling
Based in Moncton, New Brunswick, Major Drilling Group International Inc.
is one of the world's largest metals and minerals contract drilling
service companies. To support its customers' mining operations, mineral
exploration and environmental activities, Major Drilling maintains
operations in Canada, the United States, South and Central America,
Australia, Asia and Africa.
This press release may contain forward looking information within the
meaning of applicable securities laws including, without limitation,
statements with respect to the benefits that may accrue to the
Corporation and its shareholders as a consequence of the Acquisition.
Actual results could differ materially from those currently anticipated
due to a number of factors and risks. These include, but are not
limited to, integration of the Bradley Group business, failure to
realize the Acquisition benefits, potential undisclosed liabilities
associated with the Acquisition, and expansion and acquisition
strategy. Readers are cautioned that the foregoing list is not
exhaustive. The forward-looking information contained herein is
expressly qualified in its entirety by this cautionary statement. The
forward-looking information contained herein is made as of the date of
this press release, and the Corporation undertakes no obligation to
publicly update such forward-looking information to reflect new
information, subsequent or otherwise, unless required by applicable
All dollar values are quoted in Canadian dollars unless otherwise
THIS NEWS RELEASE IS NOT AN OFFER OF SECURITIES FOR SALE IN THE UNITED
STATES AND IS NOT AN OFFER TO SELL OR SOLICITATION OF AN OFFER TO BUY
ANY SECURITIES OF MAJOR DRILLING, NOR SHALL IT FORM THE BASIS OF, OR BE
RELIED UPON IN CONNECTION WITH ANY CONTRACT FOR PURCHASE OR
SUBSCRIPTION. THE SECURITIES REFERRED TO IN THIS NEWS RELEASE WERE ONLY
OFFERED IN CERTAIN PROVINCES OF CANADA BY MEANS OF PROSPECTUS.
SECURITIES MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT
REGISTRATION UNDER THE U.S. SECURITIES ACT OR AN EXEMPTION FROM
REGISTRATION THEREUNDER. THE SECURITIES REFERRED TO IN THIS NEWS
RELEASE HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S.
SECURITIES ACT OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE
OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION UNDER THE U.S.
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN
APPLICABLE EXEMPTION THEREFROM.
SOURCE MAJOR DRILLING GROUP INTERNATIONAL INC.
For further information:
Denis Larocque, Chief Financial Officer
Tel: (506) 857-8636
Fax: (506) 857-9211