TORONTO, Sept. 20, 2012 /CNW/ - As previously announced, Birch Hill Equity Partners ("Birch Hill") has applied to the Minister of Finance for approval to complete the shareholder-approved Arrangement (the "Arrangement") under the Business Corporations Act (Ontario) by which Monaco Acquisition Inc., an entity controlled by Birch Hill, will acquire all of the outstanding common shares of HOMEQ Corporation [TSX:HEQ ("HOMEQ")] for cash at a price of $9.50 per common share. Approval of the Minister under the Bank Act is required as HOMEQ's subsidiary, HomEquity Bank, is a regulated financial institution and it is the remaining significant condition to be satisfied in order to complete the Arrangement.
Birch Hill and HOMEQ's objective was to secure regulatory approval in the third quarter of 2012. Both companies have been working steadily towards that objective and continue to believe that the application will be successful. As disclosed previously the final outcome and timing of approval of the application is at the discretion of the Minister of Finance and the companies now expect that if approved, completion of the Arrangement will occur after the end of the third quarter.
Following completion of the Arrangement it is anticipated that HOMEQ shares will be delisted from the Toronto Stock Exchange and HOMEQ will apply to cease to be a reporting issuer.
HOMEQ's wholly owned subsidiary HomEquity Bank is the only national provider of reverse mortgages to homeowners aged 55 and over, Canada's fastest growing demographic segment. HomEquity Bank originates and administers Canada's largest portfolio of reverse mortgages under the CHIP Home Income Plan brand. As of June 30, 2012, the mortgage portfolio comprised approximately 9,300 reverse mortgages with an accrued value of $1.3 billion, secured by residential properties across Canada worth approximately $3.4 billion. HomEquity Bank has been the main underwriter of reverse mortgages in Canada since its predecessor, Canadian Home Income Plan, pioneered the concept in 1986. HOMEQ's shares trade on the Toronto Stock Exchange under the symbol HEQ. Additional information on HOMEQ, including annual and quarterly reports can be viewed at www.homeq.ca.
About Birch Hill
With $2 billion in capital under management, Birch Hill has invested in more than 50 investments since 1994. Birch Hill is the leader in long-term value creation in the Canadian mid-market. For more information about Birch Hill Equity Partners, please visit www.birchhillequity.com.
Certain statements included herein constitute "forward-looking statements". All statements, other than statements of historical fact, included in this release that address future activities, events, developments or financial performance are forward-looking statements. These forward-looking statements can be identified by the use of forward-looking words such as "may", "should", "will", "could", "expect", "intend", "plan", "estimate", "anticipate", "believe", "future" or "continue" or the negative thereof or similar variations. In particular, statements about the proposed Arrangement between Birch Hill and HOMEQ, including the expected timetable for completing the Transaction, the receipt of regulatory approvals and any other statements regarding HOMEQ's future expectations, beliefs, goals or prospects are or involve forward-looking information. These forward-looking statements are based on certain assumptions and analyses made by HOMEQ and its management, in light of their experiences and their perception of historical trends, current conditions and expected future developments, as well as other factors they believe are appropriate in the circumstances. Shareholders are cautioned not to put undue reliance on such forward-looking statements, which are not a guarantee of performance and are subject to a number of uncertainties, assumptions and other factors, many of which are outside the control of Birch Hill and HOMEQ, that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include, among other things, the parties' ability to consummate the Arrangement; the parties' ability to satisfy the conditions to the completion of the Arrangement, including that the receipt of regulatory approval for the Arrangement may not be obtained, or may not be obtained on the terms expected or on the anticipated schedule; general economic and market factors (including changes in global, national or regional financial, credit, currency or securities markets), changes or developments in global, national or regional political conditions (including any act of terrorism or war), changes in government laws or regulations (including tax laws) and changes in GAAP or regulatory accounting requirements. Readers are cautioned that the foregoing lists are not exhaustive.
Such forward-looking statements should, therefore, be construed in light of such factors. If any of these risks or uncertainties were to materialize, or if the factors and assumptions underlying the forward-looking information were to prove incorrect, actual results could vary materially from those that are expressed or implied by the forward-looking information contained herein. All forward-looking statements attributable to HOMEQ, or persons acting on its behalf, are expressly qualified in their entirety by the cautionary statements set forth above. Readers are cautioned not to place undue reliance on forward-looking statements contained herein, which reflect the analyses of the management of HOMEQ, only as of the date of this release.
For more information regarding these and other risks, readers should consult HOMEQ's reports on file with applicable securities regulatory authorities accessible online by going to SEDAR at www.sedar.com or by going to the HOMEQ website at www.homeq.ca. HOMEQ is under no obligation, and HOMEQ expressly disclaims any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
SOURCE: HOMEQ Corporation
For further information:
Steven Ranson, President and Chief Executive Officer, (416) 413-4663 or
Gary Krikler, Senior Vice President and Chief Financial Officer, (416) 413-4679.