Our roundup of Canadian small-caps of between $100-million and $2.5-billion in market capitalization making news and on the move today.
The federal cabinet has invoked a national security threat to turn down the proposed $1.5-billion takeover of Canadian construction giant Aecon Group Inc. (ARE-T) by a Chinese state-owned enterprise, sources have told the Globe and Mail.
The sale of Toronto-based Aecon to China Communications Construction Co. Ltd. (CCCC) was opposed by Canadian construction rivals and by two former directors of the Canadian Security Intelligence Service. Sources with knowledge of the cabinet decision told the Globe the government accepted the findings of a national security review that determined the takeover was not in the country’s national security interest.
Cabinet ordered a full national security review of the takeover bid earlier this year under section 23.5 of the Investment Canada Act, a measure invoked when the federal government believes an investment could be “injurious to national security.”
Aecon, led by chief executive officer John Beck, has downplayed concerns that have been raised about its involvement in critical infrastructure projects, such as nuclear facilities – contracts that would pass on to CCCC if the transaction was approved by Ottawa.
- Robert Fife, Steven Chase, Andrew Willis
Imperial Metals Corp. (III-T) says its unionized employees at the Mount Polley Mine have gone on strike following a three-hour lockout by the company on Wednesday.
“The lockout was intended to overcome an impasse on [the] renewal of the collective agreement which terminated on December 31, 2017,” the company stated. “Unionized employees were invited to return to work after the lockout under the terms of a new comprehensive and competitive wage and benefits package with USW Local 1-2017 dated May 9, 2018. Efforts to renew the collective agreement through mediation have so far been unproductive.”
Innergex Renewable Energy Inc. (INE-T) says it’s raising $150-million in a convertible debenture offering. It has entered into an agreement a syndicate of underwriters to buy debentures for $1,000 each, at a rate of 4.75 per cent per year payable semi-annually on June 30 and Dec. 31 each year starting on Dec. 31.
It said the net proceeds will be used to reduce drawings under the corporation’s revolving term credit facility, “which will then be available to be drawn, as required, to fund future acquisitions, development projects and for general corporate purposes.”
Calian Group Ltd. (CGY-T) says its systems engineering division has recently received a multi-million contract for the provision and installation of satellite RF ground systems. “The signing includes several RF ground systems some of which incorporate advanced technologies. This project is expected to begin immediately and runs into fiscal 2021,” the company said.
it said the contract is expected to generate 10-to-15 per cent of current levels of consolidated revenues in 2019 and 2020, “which represents a material contract.”
Ryan Schneider, the current chief operating officer, will succeed Mr. Dedeluk in both roles and has been nominated for election as a director by shareholders at the AGM. Mr. Dedeluk has been nominated by the Board for re-election as a director and, if re-elected by the shareholders, it is anticipated that he will be appointed as vice chairman of the board, the company said.
Photon Control Inc. (PHO-X), which makes optical measurement technologies for the semiconductor industry, says it has received final approval for the listing of its common shares on the Toronto Stock Exchange as of Friday.
“This new listing reflects not just our consistent revenue growth and profitability, but also our improved governance practices, and marks a historic milestone for our company and our shareholders,” said CEO Scott Edmonds.
Organigram Holdings Inc. (OGI-X) says it plans to make a ”strategic investment” in Hyasynth Biologicals, a biotechnology company based in Montreal with patent-pending technology to produce phytocannabinoids using genetically engineered strains of yeast.
Organigram plans to enter into an off-take agreement with Hyasynth to purchase a pre-defined quantity of a range of cannabinoids or cannabinoid-related production from Hyasynth.
As part of the proposed agreement, Organigram will have the right to purchase up to $10-million in senior secured convertible debentures of Hyasynth in a series of three tranches based on Hyasynth attaining certain milestones.
Pattern Energy Group Inc. (PEGI-T; PEGI-Q) says it has an agreement to sell its operations in Chile, including an 81 megawatt-owned interest in the 115 MW El Arrayán Wind project to affiliates of Arroyo Energy Investors for $67-million.
Pattern Energy also expects to eliminate more than $1-million of annual overhead related to managing the business in Chile.
“The sale of El Arrayán Wind is an excellent result for us,” said Mike Garland, CEO of Pattern Energy. “While the purchase price demonstrates material embedded value in our assets, the primary reason for the sale was strategic. Chile was a good candidate for sale as it was one of the higher cost operations in our fleet because of the distance from the rest of our operations and the different legal, tax and regulatory environments.”
He said the proceeds of the sale will go to either make further investments, pay down debt, buy back stock or other corporate purposes.
Newstrike Resources Ltd. (HIP-X) says it’s raising $40-million in a bought-deal public offering. It has an agreement with a syndicate of investment dealers to purchase 53.4 million units at 75 cents each. Each unit includes one common share and one-half of one common share purchase warrant. Each warrant will entitle the holder to purchase one common share at a price equal to $1 for 60 months. The net proceeds will be used for growth initiatives, working capital and general corporate purposes, the company said.
Isodiol International Inc. (ISOL-CN) says it has signed a letter of intent with Sundial Growers Inc., a privately held Alberta-based licensed producer of medical cannabis, to import cannabidiol (CBD) isolate into Canada, subject to applicable regulatory approvals.
Under the terms of the agreement, CBD will be imported into Canada through a Health Canada approved licensed dealer. All imported products will be tested by Sundial in accordance with Canadian standards, the company stated.
Héroux-Devtek Inc. (HRX-T) reported sales of $113-million for its fourth quarter ended March 31 up from $120.9-million in the previous year. Net income was $5.9-million or 16 cents per share, which was in line with expectations and compared to $8.9-million or 25 cents a year earlier.
EnWave Corp. (ENW-X) reported revenues of $4.2-million in its second quarter ended March 31, which was in line with expectations and comparable with the same quarter a year earlier. Its net loss for the quarter was $519,000 or a penny per share versus a loss of $779,000 or a penny per share a year ago.
Mountain Province Diamonds Inc. (MPVD-T; MPVD-Q) recently completed its fourth diamond tender sale of 2018 with total proceeds of US$28.3-million, which it said was the highest total for any tender result to date.“Market sentiment remained positive coming out of the April holidays and into the fourth selling cycle,” the company stated, noting there were 191 companies attending the tender and an average of 12.4 bids received per lot.
“Our fourth sale results reflect the overall positive sentiment in the rough diamond market, driven by the strong fundamentals of stable rough supply and positive news from the major retail markets,” stated Reid Mackie, the company’s vice-president of diamond marketing.