Allen-Vanguard Corporation Announces Closing of $300,010,000 Equity Financing


    OTTAWA, Sept. 27 /CNW Telbec/ - Allen-Vanguard Corporation
("Allen-Vanguard" or the "Company") (TSX:VRS) reported today that it has
closed its previously announced public offering of common shares (the
"Offering"), for gross proceeds of $300,010,000.
    A syndicate of underwriters, led by Genuity Capital Markets and including
Paradigm Capital Inc., Versant Partners Inc. and Canaccord Adams (together,
the "Underwriters") purchased an aggregate of 31,580,000 common shares of the
Company at a price of $9.50 per common share. Oppenheimer & Co. Inc.
participated as a special selling group member in the Offering of common
shares on an exempt basis in the United States. In addition, the Company has
granted the Underwriters an option to purchase up to an additional 4,737,000
common shares (equal to 15% of the Offering) at the issue price of $9.50 per
common share, which option shall be exercisable for 30 days following the
closing of the Offering.
    The net proceeds from the Offering will be used to repay certain debt
obligations incurred by the Company pursuant to the acquisition of Med-Eng
Systems Inc. ("Med-Eng"). The net proceeds from the Offering will be used, in
order of priority: (i) to repay to the vendors of Med-Eng (a) $150 million of
subordinated debt (plus accrued interest thereon); and (b) approximately
$40.6 million of subordinated debt (plus accrued interest thereon)
representing the excess working capital of Med-Eng at the closing of the
acquisition of Med-Eng; and (ii) to repay outstanding borrowings on the
revolving credit facility (the "Revolver") and a portion of the term debt
facility (the "Term Debt Facility").
    "We are very pleased with the success of this offering, which exceeded
our target objective," said David E. Luxton, Company President and CEO. "It
attracted several new U.S. and Canadian institutional investors, as well as
additional investment from a number of existing institutional shareholders. We
extend a warm welcome to our new shareholders, and thank all investors in this
offering for their strong vote of confidence."
    Concurrent with the closing of the Offering, the Company issued an
aggregate of 3,575,100 common share purchase warrants (the "Share Purchase
Warrants") to arrangers of the Revolver and Term Debt Facility or their
affiliates, which Share Purchase Warrants were qualified for distribution by
the final short form prospectus filed by the Company on September 21, 2007.
Each Share Purchase Warrant entitles the holders to acquire one common share
of the Company at an exercise price of $9.50 per common share until
September 27, 2014.
    With this issue of 31,580,000 shares, and the earlier issue of 14,650,000
shares at $6.85 pursuant to the private placement which closed on August 15,
2007, the Company now has approximately 105.3 million shares outstanding
(basic), or 113.1 million shares on a fully diluted basis. Shareholders'
equity, on a pro forma basis at June 30, was approximately $506.3 million.

    This news release does not constitute an offer to sell or a solicitation
of an offer to buy any of the securities in the United States. The securities
have not and will not be registered under the United States Securities Act of
1933, as amended, or any state securities laws and may not be offered or sold
within the United States or to U.S. Persons (as such term is defined in
Regulation S of the United States Securities Act of 1933, as amended) unless
an exemption from such registration is available. This press release shall not
constitute an offer to sell or a 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 Allen-Vanguard

    Allen-Vanguard Corporation supports the mission of military and homeland
security forces around the world with leading proprietary solutions for
protection and counter-measures against hazardous devices of all kinds,
whether chemical, biological, radiological or explosive (CBRNE), including
improvised explosive devices (IEDs) and remotely controlled IEDs (RCIEDs).
Allen-Vanguard equipment is in service in more than 120 countries. Products
include Electronic Counter-Measures ("ECM") equipment for jamming remote
detonation of terrorist devices, specialty security equipment for Explosive
Ordnance Disposal ("EOD"), remote intervention robots for hazardous
applications, and personal protective wear for use in dealing with explosive
and bio-chemical agents. Allen-Vanguard is the developer and/or sole,
worldwide licensee of proprietary technologies such as the Med-Eng bomb suit,
the Defender(TM) and Vanguard(TM) Mk2 bomb disposal robots, and the Universal
Containment System and CASCAD Foam system for blast mitigation and
decontamination of bio-chemical warfare agents. Professional services
encompass counter-IED intelligence, training and advisory services, including
the Triton(TM) Report on terrorist incidents around the world. The Company
operates globally through its wholly-owned subsidiaries under the names
"Allen-Vanguard", "Med-Eng" and "Hazard Management Solutions". Head office
operations are located in Ottawa, Ontario, Canada, with manufacturing
operations in Stoney Creek and Pembroke, Ontario; Ogdensburg, New York;
Tewkesbury, U.K.; and Cork, Ireland; The Company has professional services
operations in Shrivenham, UK, and in the U.S. in Arlington, Virginia, plus
sales offices in Canada, the U.S., the U.K. and Asia. Allen-Vanguard's shares
are listed on The Toronto Stock Exchange (TSX) under the symbol "VRS".

    This press release may contain forward-looking statements, which reflect
Allen-Vanguard's current expectations regarding future events, its strategy,
expected performance and condition. Forward-looking statements include
statements that are predictive in nature, that depend upon or refer to future
events or conditions, or that include words such as "expects," "anticipates,"
"plans," "believes," "estimates" or negative versions thereof and similar
expressions. In addition, any statement that may be made concerning future
performance, strategies or prospects, and possible future acquisitions or
dispositions, is also a forward-looking statement. Forward-looking statements
are based on current expectations and projections about future events and are
inherently subject to, among other things, risks, uncertainties and
assumptions about the Company and economic factors. Forward-looking statements
are not promises or guarantees of future performance, and actual events and
results could differ materially from those expressed or implied in any
forward-looking statements made about the Company. Any number of important
factors could contribute to these digressions, including, but not limited to,
general economic, political and market factors in North America and
internationally, interest and foreign exchange rates, global equity and
capital markets, business competition, technological change, changes in
government regulations, unexpected judicial or regulatory proceedings, and
catastrophic events. We stress that the above-mentioned list of important
factors is not exhaustive. We encourage you to consider these and other
factors carefully before making any investment decision and we urge you to
avoid placing undue reliance on forward-looking statements. Further, you
should be aware that the Company disclaims any obligation to publicly update
or revise any such forward-looking statements whether as a result of new
information, future events or otherwise, prior to the release of the next
Management Discussion and Analysis to be released by the Company or except as
required by law .

    To find out more about Allen-Vanguard Corporation (TSX: VRS), visit our
website at
    %SEDAR: 00018026E

For further information:

For further information: Elisabeth Preston, (613) 614-4884,

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