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Press release from Marketwire

Premium Brands Holdings Corporation Announces $50,000,000 Financing of 5.70% Convertible Unsecured Subordinated Debentures

Thursday, May 24, 2012

Premium Brands Holdings Corporation Announces $50,000,000 Financing of 5.70% Convertible Unsecured Subordinated Debentures15:40 EDT Thursday, May 24, 2012VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 24, 2012) -NOT FOR DISTRIBUTION TO U.S. NEWS SERVICES OR DISSEMINATION IN THE UNITED STATES.Premium Brands Holdings Corporation ("Premium Brands" or the "Company") (TSX:PBH), a leading producer, marketer and distributor of branded specialty food products, announced today that it has reached an agreement with a syndicate of underwriters co-led by National Bank Financial Inc. and CIBC World Markets Inc. (the "Underwriters"), pursuant to which the Company will issue on a "bought-deal" basis, subject to regulatory approval, $50,000,000 aggregate principal amount of convertible unsecured subordinated debentures (the "Debentures") at a price of $1,000 per Debentures (the "Offering"). The Company has granted to the Underwriters an over-allotment option to purchase up to an additional $7,500,000 aggregate principal amount of Debentures at the same price, exercisable in whole or in part at any time for a period of up to 30 days following closing of the Offering, to cover over-allotments. The Company intends to use the net proceeds from the Offering to reduce indebtedness, for future acquisitions and for general corporate purposes. The Debentures will bear interest from the date of issue at 5.70% per annum, payable semi-annually in arrears on June 30 and December 31 each year commencing December 31, 2012. The Debentures will each have a maturity date of June 30, 2017 (the "Maturity Date").The Debentures will be convertible at the holder's option at any time prior to the close of business on the earlier of the Maturity Date and the business day immediately preceding the date specified by the Company for redemption of the Debentures into common shares at a conversion price of $28.30 per common share, being a conversion rate of 35.3357 common shares for each $1,000 principal amount of Debentures. Closing of the Offering is expected to occur on or about June 18, 2012. The Offering is subject to normal regulatory approvals, including approval of the Toronto Stock Exchange. The Debentures will be offered in each of the provinces of Canada by way of a short form prospectus, and by way of private placement in the United States to Qualified Institutional Buyers pursuant to Rule 144A.Premium Brands owns a broad range of leading specialty food manufacturing and differentiated food distribution businesses with operations in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, Washington State, and Nevada. The Company services over 26,000 customers and its family of brands and businesses include Grimm's, Harvest, McSweeney's, Bread Garden Express, Hygaard, Hempler's, Quality Fast Foods, Gloria's Best of Fresh, Harlan Fairbanks, Creekside Bakehouse, Centennial Foodservice, B&C Foods, Duso's Fine Foods, Maximum Seafood, SK Food Group, Hub City Fisheries, Audrey's, Deli Chef, Hamish & Enzo and Piller's Fine Foods.Forward-Looking Statements This press release contains forward looking statements with respect to the Company, including its business operations, strategy and financial performance and condition. These statements generally can be identified by the use of forward looking words such as "may", "could", "should", "would", "will", "expect", "intend", "plan", "estimate", "project", "anticipate", "believe" or "continue", or the negative thereof or similar variations.Although management believes that the expectations reflected in such forward looking statements are reasonable and represent the Company's internal expectations and belief as of May 24, 2012, such statements involve unknown risks and uncertainties beyond the Company's control which may cause its actual performance and results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward looking statements.Factors that could cause actual results to differ materially from the Company's expectations include, among other things: (i) seasonal and/or weather related fluctuations in the Company's sales; (ii) changes in consumer discretionary spending resulting from changes in economic conditions and/or general consumer confidence levels; (iii) changes in the cost of raw materials used in the production of the Company's products; (iv) changes in the cost of products sourced from third party manufacturers and sold through the Company's proprietary distribution networks; (v) risks associated with the Company's conversion from a publicly traded income trust to a publicly traded corporation, including related changes in Canada's income tax laws; (vi) changes in the Company's relationships with its larger customers; (vii) potential liabilities and expenses resulting from defects in the Company's products; (viii) changes in consumer food product preferences; (ix) competition from other food manufacturers and distributors; and (x) new government regulations affecting the Company's business and operations. Details on these risk factors as well as other factors can be found in the Company's 2011 MD&A, which is filed electronically through SEDAR and is available online at www.sedar.com.Unless otherwise indicated, the forward looking information in this document is made as of May 24, 2012 and, except as required by applicable law, will not be publicly updated or revised. This cautionary statement expressly qualifies the forward looking information in this document.FOR FURTHER INFORMATION PLEASE CONTACT: George PaleologouPremium Brands Holdings CorporationPresident & CEO(604) 656-3100ORWill KalutyczPremium Brands Holdings CorporationCFO(604) 656-3100www.premiumbrandsholdings.com