VANCOUVER, Jan. 30 /CNW/ - Canaccord Capital Inc. (TSX & AIM: CCI) today
announces the completion of the Canaccord Relief Program. The Canaccord Relief
Program repurchases, at par value, up to $152 million of restructured
third-party Asset Backed Commercial Paper (ABCP) from eligible clients. The
transaction has closed and funds are now available in eligible client
"Over the past seventeen months, Canaccord has worked to protect our
clients' best interests through a very difficult situation," said Mark
Maybank, Chief Operating Officer of Canaccord Capital Inc. "I'd like to thank
our Investment Advisors, Operations team and everyone involved at Canaccord
for working diligently toward this successful conclusion on behalf of our
The Canaccord Relief Program combines transactions with third-party
sources with a Canaccord-funded top-up to achieve par value. Clients have also
received any unpaid interest to the extent that it is available under the
restructuring plan and Canaccord has reimbursed the eligible clients' actual
share of any restructuring costs incurred. The Canaccord Relief Program
includes clients who held $1 million or less of ABCP, approximately 1,440, or
98%, of Canaccord's noteholder clients.
Canaccord Capital also announces that further charges are expected to be
disclosed in the Company's fiscal third quarter results, scheduled to be
announced on February 12, 2009. Additional out-of-pocket charges will result
in an increase of the Canaccord Relief Program accounting provision by up to
$2.7 million pre-tax. Furthermore, as a result of the completion of the
Canaccord Relief Program, Canaccord has purchased MAV 2, Class 15 notes, with
a book value of $9.5 million, which will be added to the Company's previously
disclosed treasury position of $29.8 million. As part of the quarterly
earnings cycle and as management estimates the fair value of its ABCP
holdings, Canaccord may apply further charges to this aggregate treasury
position. When combined with the effect of challenging market conditions,
including any potential for additional impairment of goodwill, our third
quarter earnings are expected to be below the current consensus estimate.
"We are disappointed by the necessity of additional charges for our
firm," said Paul Reynolds, President and CEO of Canaccord Capital Inc.
"However, our commitment to our clients and to the Canaccord Relief Program is
unwavering. We remain a well-capitalized company focused on operating
effectively in this challenging environment."
More information about the Canaccord Relief Program is available to
clients at www.canaccordrelief.com.
ABOUT CANACCORD CAPITAL INC.:
Through its principal subsidiaries, Canaccord Capital Inc. (TSX & AIM:
CCI) is a leading independent, full-service investment dealer in Canada with
capital markets operations in the United Kingdom and the United States.
Canaccord is publicly traded on both the Toronto Stock Exchange and AIM, a
market operated by the London Stock Exchange. Canaccord has operations in two
of the principal segments of the securities industry: capital markets and
private client services. Together, these operations offer a wide range of
complementary investment products, brokerage services and investment banking
services to Canaccord's private, institutional and corporate clients.
Canaccord has 30 offices worldwide, including 23 Private Client Services
offices located across Canada. Canaccord Adams, the international capital
markets division, has operations in Toronto, London, Boston, Vancouver, New
York, Calgary, Montreal, San Francisco, Houston, and Barbados.
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