~Sale and leaseback frees cash, reduces debt, and secures facility~
VANCOUVER, CANADA, May 8, 2017 /CNW/ - Avigilon Corporation ("Avigilon" or the "Company") (TSX: AVO), provider of trusted security solutions, today announced that it has entered into an agreement to sell the Company's downtown Vancouver office tower and associated land (the "Building") for expected gross proceeds of approximately CAD $107.5M (the "Transaction"). Avigilon will lease back the Building, thereby securing its facility needs while reducing its debt, providing cash for general working capital purposes, and enhancing shareholder value.
"We're very pleased with the investment we made in the Building," said Alexander Fernandes, Avigilon's Founder, President, Chief Executive Officer and Chairman of the Board. "The Transaction unlocks over $100 million in cash, will substantially reduce our debt, and secures a state-of the-art facility to support our growing business."
Avigilon purchased the Building in November 2015 for CAD $42M. Renovations on the Building are nearing completion, and Avigilon expects to move in Q2 2017.
The Transaction is subject to certain conditions that are typical for a transaction of this nature, including completion of the purchaser's due diligence, completion of applicable filings under the Competition Act (Canada), satisfaction of Avigilon's obligations under its credit facility, and finalization of the terms of the Building lease.
Avigilon Corporation provides trusted security solutions to the global market. Avigilon designs, develops, and manufactures video analytics, network video management software and hardware, surveillance cameras, and access control solutions. To learn more about Avigilon, visit avigilon.com.
© 2017, Avigilon Corporation. ™ indicates a trademark of Avigilon Corporation. Other marks referred to herein are the property of their respective owners.
For further information:
Vice President, Capital Markets & Communications
T: (604) 629-5182
Manager, Global Communications
T: (604) 629-5182 x2625
Certain information and statements in this news release contain and constitute forward-looking information or forward-looking statements as defined under applicable securities laws (collectively, "forward-looking statements"). Forward-looking statements normally contain words like 'believe', 'expect', 'anticipate', 'plan', 'intend', 'continue', 'estimate', 'may', 'will', 'should', 'ongoing' and similar expressions, and within this news release include any statements (express or implied) respecting: Avigilon's ability to complete the Transaction on acceptable terms, in a timely fashion, or at all; the effect that completion of the Transaction may have on shareholder value, and Avigilon's debt, cash and working capital positions; Avigilon's ability to complete the ongoing renovations to the Building in a timely fashion; the suitability of the Building for Avigilon's intended occupancy; and the future growth of Avigilon's business.
Forward-looking statements are not guarantees of future performance, actions, or developments and are based on expectations, assumptions and other factors that management currently believes are relevant, reasonable and appropriate in the circumstances, including, without limitation, assumptions that: there will not be any unanticipated or unexpected impediments to the completion of the Transaction and Avigilon will be able to complete the Transaction on the terms currently contemplated by the parties; the potential effect that completion of the Transaction may have on shareholder value, and Avigilon's debt, cash and working capital positions, is relative to Avigilon's current share price and Avigilon's current financial position; the business and economic conditions affecting the commercial real estate market in Vancouver will continue substantially in their current state, and not be subject to a downturn, during the time period in which Avigilon pursues the completion of the Transaction; that applicable property transfer tax rules will remain in their current form; will the factors associated with the suitability of the Building for Avigilon's intended occupancy will remain as they currently are; and the factors associated with the potential development and growth of the business of Avigilon will remain as they currently are.
Although management believes that the forward-looking statements are reasonable, actual results could be substantially different due to the risks and uncertainties associated with and inherent to both: (i) Avigilon's business, as more particularly described in the "Risk Factors" section of Avigilon's Annual Information Form dated February 28, 2017, which is available under Avigilon's profile on SEDAR at www.sedar.com; and (ii) the commercial real estate market in Vancouver. Material risks and uncertainties applicable to the forward-looking statements set out herein include, but are not limited to, unforeseen events, developments or factors causing any of the aforesaid expectations, assumptions, and other factors ultimately being inaccurate or irrelevant. Although Avigilon has attempted to identify factors that may cause actual actions, events or results to differ materially from those disclosed in the forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, predicted, estimated or intended. Also, many of the factors are beyond the control of Avigilon. Accordingly, readers should not place undue reliance on forward-looking statements.
Avigilon undertakes no obligation to reissue or update any forward-looking statements as a result of new information or events after the date hereof except as may be required by law. All forward-looking statements contained in this news release are qualified by this cautionary statement.
SOURCE Avigilon Corporation