/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES/
MONTREAL, June 20, 2016 /CNW Telbec/ - Telesystem Ltd ("Telesystem") announces that it has entered into an agreement with National Bank Financial Inc. and GMP Securities L.P. for a secondary offering by Telesystem on a private placement bought deal basis of 4,310,965 subordinate voting shares ("Subordinate Voting Shares") of Stingray Digital Group Inc. ("Stingray") at a price of $7.15 per share for gross proceeds of $30,823,399.75 (the "Offering").
The Offering is being undertaken for estate planning purposes. In 2015, Telesystem agreed to maintain its ownership of multiple voting shares of Stingray ("Multiple Voting Shares") for at least two (2) years and reaffirms its intention to maintain its ownership of all of its Multiple Voting Shares and remaining Subordinate Voting Shares. The successful business model and growth strategy of Stingray which are confirmed by the recent release of its annual financial results only reinforce Telesystem's intention to maintain a long-term position in Stingray.
"I am very pleased with Stingray's results and excited to continue working with Eric Boyko. Stingray's management team has done tremendous work since the company's inception. Telesystem is proud to contribute to the growth of one of the rare Québec-based companies to have successfully completed an initial public offering and to support such a performing growth strategy", said François-Charles Sirois, President and CEO of Telesystem and Chairman of Stingray.
Upon completion of the Offering, Telesystem will continue to own 500,000 Subordinate Voting Shares and 5,500,000 Multiple Voting Shares in the share capital of Stingray, representing approximately 1.4 % of the issued and outstanding Subordinate Voting Shares, 11.7 % of all of the issued and outstanding shares of Stingray, and 28.1 % of the voting rights attached to all of the issued and outstanding shares of Stingray. Telesystem will continue to have the right to nominate three individuals to Stingray's board of directors under the Nomination Rights Agreement entered into between the principal shareholders of Stingray.
Details of the Offering
Closing of the Offering is expected to occur on or about June 27, 2016.
The Subordinate Voting Shares will be sold in Canada on a private placement basis to "accredited investors" under National Instrument 45-106 and pursuant to certain other available and agreed upon prospectus exemptions.
The Subordinate Voting Shares to be offered pursuant to the Offering have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any offer, solicitation or sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
About Telesystem Ltd
Telesystem is a family-owned media and technology holding company, making long term investments to build solid international businesses. Telesystem is a private issuer. Additional information relating to Telesystem is available at www.telesystem.ca.
SOURCE Telesystem Ltd
For further information: Michel Cordeau, Vice president legal services and assistant secretary, Telesystem Ltd, 514 397-8460