All amounts expressed in CAD$
MONTREAL and WOODSTOCK, ON, July 24, 2014 /CNW Telbec/ - TransForce Inc.
(TSX: TFI) (OTCQX: TFIFF), a North American leader in the
transportation and logistics industry, and Contrans Group Inc. (TSX:
CSS), a diverse provider of specialized transportation services, today
announced that they have entered into a Support Agreement for the
acquisition by TransForce, for $14.60 in cash per share, of all of the
issued and outstanding Class A subordinate voting shares and Class B
multiple voting shares of Contrans by way of a friendly, Board-approved
take-over bid (the "Offer"). The total equity purchase price is
approximately $495 million.
The Support Agreement provides that if all conditions of the Offer have
been satisfied or are waived by TransForce, Contrans will declare a
special dividend of $0.40 per share in respect of the recent sale of
its Waste Transportation segment. Together with the $14.60 per share
Offer price, the total consideration of $15.00 represents a premium of
approximately 16.7% to the 52-week volume weighted average trading
price of Contrans' Class A shares on the Toronto Stock Exchange and a
premium of approximately 5.1% to the volume weighted average trading
price of Contrans' Class A shares for the ten trading days ended
July 24, 2014. The special dividend will be paid to Contrans
shareholders of record immediately prior to TransForce taking-up and
paying for tendered shares under the Offer. As a result, Contrans
shareholders who tender their shares to the Offer will receive the
special dividend, if paid.
The Board of Directors of Contrans, after consultation with its
financial and legal advisors, has unanimously approved entering into
the Support Agreement and unanimously recommends that Contrans
shareholders tender their shares to the Offer. Cormark Securities
Inc., the financial advisor to Contrans, has provided a fairness
opinion to the effect that, as of the date of the opinion and subject
to the limitations and qualifications therein, the consideration of
$14.60 in cash per share to be received by Contrans shareholders is
fair, from a financial point of view, to the Contrans shareholders.
All of Contrans' directors and executive officers, holding in the
aggregate 100% of Contrans' Class B shares and approximately 14.1% of
its Class A shares, have entered into "soft" lock-up agreements with
TransForce, pursuant to which they have agreed to tender all of their
Contrans shares to the Offer.
"I have admired the progress of Contrans for some time. Contrans has a
culture similar to that of TransForce, strategically acquiring
companies that add value for its shareholders. Contrans has a history
of profitability, is financially sound and has seen steady growth over
the years. From transportation facilities located mostly in Canada,
Contrans offers customers a wide array of specialized services. This
acquisition provides exciting potential for TransForce, adding strong
resources, an excellent client base, and importantly, very strong
management," said Alain Bédard, Chairman, President and Chief Executive
Officer of TransForce.
"TransForce has a significant market presence that will benefit our
operations and possesses many of the same values that have allowed
Contrans to operate successfully. I believe the entrepreneurial
culture of Contrans will fit in well with TransForce. I am proud of
Contrans' management's accomplishments over the past 25 years and look
forward to seeing the team continue to flourish as part of the
TransForce organization," said Stan Dunford, Chairman and Chief
Executive Officer of Contrans.
The Offer is not subject to any financing condition. TransForce has
entered into a commitment letter with National Bank of Canada and Royal
Bank of Canada to ensure that the required funds will be available to
make full payment to complete the Contrans acquisition pursuant to the
The Support Agreement contains customary deal protection provisions in
favour of TransForce for a transaction of this kind.
The Offer is expected to commence on or about August 21, 2014.
TransForce will mail a take-over bid circular and related documents,
and Contrans will mail a directors' circular, to Contrans shareholders
in accordance with the Support Agreement and applicable laws. The
Offer will be open for acceptance for a period of not less than 35 days
and will be conditional upon, among other things, there being validly
deposited or tendered and not withdrawn, a number of Contrans shares
that represents at least 662/3% of the outstanding Class A shares and at least 662/3% of the outstanding Class B shares, and at least a majority of the
outstanding Class A shares, the votes of which would be included in any
minority approval of a subsequent acquisition transaction by
TransForce, pursuant to applicable securities regulations. The Offer
will be subject to certain customary conditions, including receipt of
relevant regulatory approvals and the absence of any material adverse
changes with respect to Contrans. Once the minimum acceptance level
for the Offer is achieved, TransForce intends to take steps available
to it under applicable law to acquire all other outstanding shares of
Following successful completion of the Offer, TransForce intends to
nominate Stan Dunford, Chairman and Chief Executive Officer of
Contrans, for election to the TransForce Board of Directors at the next
annual meeting of TransForce's shareholders, expected to be held in
National Bank Financial Inc. is acting as financial advisor and Fasken
Martineau DuMoulin LLP is acting as legal counsel to TransForce in
connection with the Offer. Cormark Securities Inc. is acting as
financial advisor and Cassels Brock & Blackwell LLP is acting as legal
counsel to Contrans.
TRANSFORCE CONFERENCE CALL
Friday, July 25, 2014 at 9:00 a.m., Eastern time
Dial-in number: 1-888-231-8191
A presentation is also available at www.transforcecompany.com
A recording of the call will be available until midnight on August 1,
2014 by dialing 1-855-859-2056 or 416-849-0833 and entering passcode
TransForce Inc. is a North American leader in the transportation and
logistics industry operating across Canada and the United States
through its subsidiaries. TransForce creates value for shareholders by
identifying strategic acquisitions and managing a growing network of
wholly-owned, operating subsidiaries. Under the TransForce umbrella,
companies benefit from corporate financial and operational resources to
build their businesses and increase their efficiency. TransForce
companies service the following segments:
Package and Courier;
Truckload, which includes specialized truckload and dedicated services;
Specialized Services, which includes waste management, logistics
services and rig moving services.
TransForce Inc. is publicly traded on the Toronto Stock Exchange (TSX:
TFI) and the OTCQX marketplace in the U.S. (OTCQX: TFIFF). For more
information, visit http://www.transforcecompany.com.
Contrans has been providing freight transportation services as a
publicly-listed company since 1985. With approximately 1,400 power
units and 2,600 trailers under management, Contrans is one of the
largest freight transportation companies in Canada.
Contrans is publicly traded on the Toronto Stock Exchange (TSX: CSS).
For more information, visit http://www.contrans.ca.
No stock exchange, securities commission or other regulatory authority
has approved or disapproved of the information contained herein.
This press release contains "forward-looking statements" within the
meaning of applicable securities laws that are intended to be covered
by the safe harbours created by those laws, including statements that
use forward-looking terminology such as "may", "will", "expect",
"anticipate", "believe", "continue", "potential", or the negative
thereof or other variations thereof or comparable terminology. Such
forward-looking statements may include, without limitation, statements
regarding the completion of the proposed transaction and other
statements that are not historical facts. While such forward-looking
statements are expressed by Contrans and TransForce in good faith and
believed by Contrans and TransForce to have a reasonable basis, they
are subject to important risks and uncertainties including, without
limitation, approval of applicable governmental authorities, the
satisfaction or waiver of certain other conditions contemplated by the
Support Agreement, and changes in applicable laws or regulations.
Forward-looking statements are based on suppositions and uncertainties
as well as on management's best possible evaluation of future events.
Such factors may include, without excluding other considerations,
fluctuations in quarterly results, evolution in customer demand for
products and services, the impact of price pressures exerted by
competitors, and general market trends or economic changes. As a
result, readers are advised that actual results may differ from
expected results. The timing and completion of the proposed
acquisition of Contrans is subject to certain conditions, termination
rights and other risks and uncertainties. Accordingly, there can be no
assurance that the proposed acquisition of Contrans will occur, or that
it will occur on the timetable or on the terms and conditions
contemplated. Investors should not assume that any lack of update to a
previously issued forward-looking statement constitutes a reaffirmation
of that statement. Reliance on forward-looking statements is at
investors' own risk.
SOURCE: TransForce Inc.
For further information:
For further information - TransForce:
Chairman, President and CEO
For further information - Contrans:
Stan G. Dunford, Chairman and Chief Executive Officer, or
Greg W. Rumble, President and Chief Operating Officer
Phone: 519-421-4600 E-mail: firstname.lastname@example.org Web site: www.contrans.ca