Streetwise reporter Niall McGeePeter Power/The Globe and Mail
DEAL OF THE DAY: Concordia raises $520-million (U.S.) in share sale
Concordia Healthcare Corp.'s public share sale is done and dusted.
In a release late Thursday, the Oakville, Ont.-based pharma company said that it had commitments from investors to buy eight million common shares and raise $520-million (U.S.). The public offering was announced on Monday. The cash will be used in part to fund its recent $2.1-billion acquisition of Amdipharm Mercury Co. Ltd.
INITIAL PUBLIC OFFERINGS
Gibraltar closes its IPO
SPAC No. 5 is in the bag.
Gibraltar Growth Corp., a special purpose acquisition corporation (SPAC) that announced in July it intended to raise $100-million (Canadian) from investors, has closed its initial public offering.
CEO Cam di Prata e-mailed me late Thursday with a simple "we're done," confirming that the money had been raised.
He would not offer any more information on how the capital raise went.
On Thursday, underwriters for the company offered potential investors an extra sweetener if they were willing to buy into the IPO, which suggests that it wasn't entirely clear sailing for Gibraltar. Bankers told investors that, if they participated, they would receive a share and a warrant to buy an additional share.
Under the original term sheet, investors were set to receive a share and half a warrant. The warrant allows investors to buy an additional share in the company at $11.50 up to five years after the company completes its qualifying transaction (acquisition). Gibraltar is expected to start trading next week at $10 a share.
Gibraltar is the brainchild of Mr. di Prata, founder of Gibraltar & Co., a Toronto-based private equity shop, and Joe Mimran, former creative director with Loblaw Cos. Ltd.'s Joe Fresh brand. Gibraltar is targeting an acquisition with an enterprise value of up to $750-million. The company will look at North American companies in the consumer products, media, technology, health and financial services sectors.
Gibraltar is the fifth SPAC to close its IPO in Canada this year. A sixth, Avingstone Acquisition Corp., announced plans to raise $110-million in September but hasn't closed yet. Avingstone's focus is more specialized in nature than any of the Canadian SPACs that have come to market so far. It plans to seek out an acquisition in the hospitality and real estate sector.
A number of investment bankers have said that the Canadian SPAC market is getting long in the tooth, and that a slowdown – or at least a pause – is likely before we see any more SPACs filing for IPOs. Over a billion dollars has been raised this year in Canada by these shell companies that have no inherent operations yet – only a mandate to seek out an acquisition.
The ultimate benchmark for success in running a SPAC is akin to climbing Everest. When a SPAC closes its IPO – much like a climber that that has reached the summit – it is only half way there. The SPAC must now successfully pull off an acquisition within a narrow time frame – roughly two years – and, much like the journey back to base camp for the Everest climber, that's no easy feat.
MERGERS AND ACQUISITIONS
Ex-Bauer chairman explores privatization bid
W. Graeme Roustan, former chairman of Performance Sports Group Ltd., has hired bankers to explore taking the company private in a transaction that could value the firm at as much as $1-billion (U.S.), according to a person familiar with the matter.
Glencore hires bankers to explore agriculture sale
Glencore PLC hired Citigroup Inc. and Credit Suisse Group AG to sell a minority stake in its agricultural business, a deal that could value the whole division at as much as $12-billion, according to a person familiar with the situation.
FINANCINGS
SunOpta prices offering
SunOpta Inc. announced the pricing of a $100-million offering consisting of 16,670,000 common shares at a price of $6 per share. The proceeds of the offering will fund a portion of of the acquisition of Sunrise Holdings.
IN CASE YOU MISSED IT
Scotiabank heads to Silicon Valley
As "fintech" becomes the hottest buzzword on Bay Street, the Big Six are on the hunt for a technological edge. For many, it is a quest that is centred more than 4,000 kilometres away.
While Canadian bank executives have increasingly been making pilgrimages to Silicon Valley, Bank of Nova Scotia is taking this interest up a notch. On Sunday, key executives are bringing the bank's board of directors with them.
Junior miners' next big test
The major knock against junior miners has been financing risk. No one knows if they will be able to raise the money they need to get their projects into production because shareholders have been so badly burned. That makes the recent developments at TMAC Resources Inc. and Pretium Resources Inc. all the more interesting.
Scared of the Canadian economy? RioCan isn't
Wasting little time, RioCan Real Estate Investment Trust has proven its willingness to trade American assets for a bigger Canadian portfolio – despite the weaker economy on this side of the border.
Got any Bay Street buzz? If you have any story suggestions for the Daily Deal Roundup, e-mail us at deals@globeandmail.com or nmcgee@globeandmail.com
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Niall McGee