The sawmill in the Temiscaming region in northwestern Quebec has an annual production capacity of 100 million board feet.The Canadian Press
Our roundup of Canadian small-caps of between $100-million and $2.5-billion in market capitalization making news and on the move today.
Tembec Inc. (TMB-T) has received a friendly takeover offer from Rayonier Advanced Materials Inc. (RYN-N) of Jacksonville, Fla.
Rayonier's offer values the Quebec-based lumber, paper and pulp producer at $807-million (U.S.), including $487-million of debt that will be assumed by the new owner.
Tembec shareholders are being offered $4.05 (Canadian) in cash or 0.2302 of a Rayonier share, subject to a cap on the total amount of cash or shares that will be issued.
The companies say Tembec's Canadian headquarters will remain in Montreal.
--The Canadian Press
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Home Capital Group Inc. (HCG-T) on Wednesday published data showing that its high-interest savings account balances declined on Tuesday.
Home Capital has been struggling to finance its assets as its high-interest deposit account balances have fallen by more than 90 per cent since March 27, when the company terminated the employment of former CEO Martin Reid.
The withdrawals accelerated after April 19, when Canada's biggest securities regulator, the Ontario Securities Commission, accused Home Capital of making misleading statements to investors about its mortgage underwriting business. The company has said the accusations are without merit.
Home Capital said its high-interest rate savings deposit balances stood at $113.3-million on Tuesday, compared with $115-million the day before.
Its cashable GIC deposits, which holders can redeem before their maturity date, rose to $145-million on Tuesday, compared with $144-million the day before.
The company said it had access to $1.14-billion in available liquidity and credit capacity on Tuesday, down from $1.46-billion the day before, having drawn down $250-million from a credit facility provided by the Healthcare of Ontario Pension Plan to pay an outstanding $325-million bond on its maturity date of May 24.
--Reuters
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Héroux-Devtek Inc. (HRX-T) reported fourth-quarter sales of $120.9-million up from $117.5-million a year earlier.
The 2.9-per-cent increase "reflects higher sales to the commercial aerospace market ... while year-over-year fluctuations in the value of the Canadian currency versus foreign currencies had a negative impact of $3.5-million on fourth-quarter sales," the company said.
Net income was $8.9-million or 25 cents per share versus $9-million or 25 cents a year earlier.
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Torex Gold Resources Inc. (TXG-T) reported a fatal accident at the construction site associated with its El Limon-Guajes Mine in Mexico.
An internal investigation is underway to determine the cause of the accident, the company said. Authorities were notified and inspected the site.
"All mining activities were suspended while crews were informed of the accident, and equipment and roadways were inspected," said CEO Fred Stanford. "The open pit mining inspections were successfully completed within 24 hours and mining activities were restarted. The processing plant operations sourced feed from stockpiles and were uninterrupted. The construction site remains closed pending completion of inspections and key aspects of the investigation."
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Timbercreek Financial Corp. (TF-T) says it's raising $40-million in an offering of convertible debentures.
It has an agreement with a syndicate of underwriters led by National Bank Financial.
The company said it will use the net proceeds to repay amounts owing under its secured revolving credit facility, "and will subsequently draw on the credit facility for purposes of funding future mortgage loans."
"With the continued strength of high-quality deal flow that we are seeing, these additional funds will help us meet the ongoing demand for short-term, structured financing solutions in the commercial mortgage market," said Andrew Jones, CEO of Timbercreek Financial. "In particular, we are reviewing several accretive opportunities and are, as always, focused on building a portfolio of conservative mortgages that generate attractive yield."
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Fortuna Silver Mines Inc. (FSM-N; FVI-T) reported net income of $13-million (U.S.) in the first quarter and earnings of 8 cents per share. That compared to net income of $2.6-million or 2 cents a year earlier.
Revenue came in at $64.8-million compared to $42.7-million a year earlier.
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Slate Retail REIT (SRT.UN-T) ) says it's raising $65-million in a bought-deal equity offering and private placement.
It's selling 4.4 million units to a syndicate of underwriters led by CIBC Capital Markets, BMO Capital Markets and GMP Securities. The units will be offered at a price of $14.75 each.
Slate Asset Management L.P., the REIT's manager, will acquire 170,000 units for gross proceeds of approximately $2.5-million, representing 3.7 per cent of the offering and private placement.
Proceeds will initially be used to reduce debt, which the REIT said "may be subsequently redrawn and applied as needed to fund future acquisitions and for general trust purposes."
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Medicure Inc. (MPH-X) recorded net revenue of $8.7-million during the quarter ended March 31, compared to $6.1-million a year earlier.
Its net loss was $5.1-million or 33 cents per share, compared to net income of $792,000 or 5 cents for the quarter ended March 31, 2016.
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Pure Multi-Family REIT LP (RUF.UN-X) says it has an agreement to acquire Pinnacle at Union Hills, a multi-family apartment community in Phoenix, Arizona, for $47.5-million (U.S.).
"We have been monitoring the Phoenix market for an extended period and are very pleased to be expanding our footprint with this institutional quality property located in north Phoenix, close to a strong and diverse employment centre, that already hosts the offices of several international corporations," said Stephen Evans, Pure Multi-Family's CEO.
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Liquor Stores N.A. Ltd. (LIQ-T) issued a letter to its shareholders arguing against moves suggested by activist investor PointNorth Capital, saying they will "destroy value."
PointNorth Capital, which owns 9.7 per cent of the company, wants to nominate six out of eight Liquor Stores directors, "and put in place a strategy that will destroy shareholder value," the company said.
"Using conservative assumptions, we have calculated that by the time PointNorth has finished implementing its plan, it will have reduced operating profits by about $10 million annually which would wipe $2.65 off our share price,"it stated. "Surely, PointNorth doesn't want to destroy value, but that's what will happen if shareholders elect directors who don't have the knowledge or experience to properly oversee our business, and who appear to lack the independence to look after your best interests."
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SouthGobi Resources Ltd. (SGQ-T) says $22.3-million (U.S.) in interest payments and fees due to China Investment Corporation (CIC) due on May 19 haven't been paid and advised shareholders to "exercise caution when dealing in securities of the company."
"The principal amount outstanding and all accrued and unpaid interest and other amounts owing under the convertible debenture and the December 2016 deferral agreement would immediately become due and payable in the event that CIC provides notice to the company," it said in a release.
SouthGobi says it's in discussions with CIC for a repayment plan.
"While the company believes that an agreement will be reached, there is no assurance that an agreement will be concluded on terms acceptable to the company, or at all," it said. "In such event, the value of the company's common shares could be materially and negatively affected. As a result, shareholders of the company and potential investors are advised to exercise caution when dealing in securities of the company."