The Brick Warehouse Corp. plans a $400-million income trust initial public offering, as founder William Comrie cashes in part of his stake in the furniture and home electronics chain.
The 162-store, Edmonton-based company announced plans late Friday to sell as much as a 60-per-cent interest in the form of a trust. Mr. Comrie, who founded the Brick 33 years ago and stepped down as chief executive officer in March, will hold the remainder but will subordinate part of his stake to outside investors. Units will be priced at $10 each, and will likely offer an annual cash distribution of less than $1, or less than 10 per cent.
The Brick has grown explosively in the past year, buying 81 United Furniture Warehouse stores, and opening six outlets in Quebec.
As it expanded over the past decade, the Brick enjoyed steady growth in sales and its ability to generate cash. Revenues have been growing at a 9.6 per cent clip for the past nine years, to $921.6-million last year.
The chain's all-important earnings before interest, tax, depreciation, amortization (EBIDTA), which shows how much money might be available for distribution, rose at a 11.4 per cent pace since 1996. The company estimates that based on last year's results, it would have had $65.0-million available for unitholders.
The proposed IPO, which is expected to close in June, would value the Brick at $660-million. Investment dealers CIBC World Markets Inc. and RBC Dominion Securities Inc. are leading the offering.
