TORONTO--(BUSINESS WIRE)--Acasta Enterprises Inc. (TSX: AEF) (“Acasta” or the “Company”) announced today that it has completed the previously announced sale (the “Transaction”) of its Stellwagen business unit (“Stellwagen”) to a company (the “Purchaser”) that will be indirectly owned by Mr. Douglas Brennan and certain other investors.
“With the closing of the Transaction, Acasta has reduced its over-all bank indebtedness to approximately U.S.$153 million. Moving forward, Acasta will focus exclusively on creating value in its consumer products operating companies and focus on further debt reduction initiatives,” commented Ian Kidson, Interim Chief Executive Officer of Acasta.
Acasta has applied the initial proceeds from the Transaction, being approximately U.S.$35 million, to satisfy the previously disclosed payment of U.S.$25 million owed by Acasta by March 31, 2018 under its U.S.$150 million credit facility (the “Credit Facility”) and to pay down additional amounts outstanding under the Credit Facility. As a result of the Transaction, Acasta has effectively also reduced its share count from approximately 95.7 million issued and outstanding common shares to approximately 69.7 million common shares.
As previously disclosed, Acasta retained ownership of profit participating notes (“PPNs”) issued to Acasta by a subsidiary of Stellwagen and is working with its financial advisor to monetize the PPNs. Acasta will use proceeds from the sale of the PPNs to further pay down indebtedness outstanding under the Credit Facility.
The special committee of independent directors of the board of directors received an opinion from Blair Franklin Capital Partners Inc. dated March 18, 2018 that the consideration received by Acasta in connection with the Transaction is fair, from a financial point of view, to Acasta.
2017 Financial Statements and Investor Conference Call
Acasta will release its fourth quarter and year-end 2017 financial results after market close on Monday April 2, 2018 instead of March 29, 2018 as previously announced.
Acasta’s senior management will host a conference call on Tuesday, April 3, 2018 at 9:00 a.m. (E.D.T.) to discuss the Company’s financial and operating results. Please dial 1-416-406-0743 or toll-free (Canada/US) 1-800-806-5484 with passcode 1948342. To ensure your participation, please join approximately five minutes prior to the scheduled start of the conference call.
The conference call will be archived on the Company’s website at www.acastaenterprises.com and will be available for replay at 1-905-694-9451 or toll-free (Canada/US) 1-800-408-3053 with passcode 8204336, expiring on May 15, 2018.
Cautionary Note Concerning Forward Looking Statements
This news release includes forward looking statements. All such statements constitute forward looking information within the meaning of applicable securities law and are made pursuant to the “safe harbour” provisions of applicable securities laws. Forward looking statements include, but are not limited to, monetizing the PPNs and statements about other anticipated future events or results, including comments with respect to Company’s future financial performance and condition. Forward looking statements are statements that are predictive in nature, depend upon or refer to future events or conditions and are identified by words such as “will”, “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates” or similar expressions concerning matters that are not historical facts. Such statements are based on current expectations of the Company’s management and inherently involve numerous risks and uncertainties, known and unknown, including economic factors. The forward-looking information contained in this news release is presented for the purpose of assisting readers in understanding the Company’s business and strategic priorities and objectives. A number of risks, uncertainties and other factors may cause actual outcomes or financial results to differ materially from the forward looking statements contained in this news release, including, among other factors, those referenced in the section entitled “Risk Factors” in the Company’s annual information form for the year ended December 31, 2016, a copy of which is available on the SEDAR website at www.sedar.com under the Company’s profile. Forward looking statements contained in this news release are not guarantees of future outcomes performance and, while forward looking statements are based on certain assumptions that the Company considers reasonable, actual events could differ materially from those expressed or implied by forward looking statements made by the Company. Readers are cautioned to consider these and other factors carefully when making decisions with respect to the Company and to not place undue reliance on forward looking statements. Circumstances affecting the Company may change rapidly. Except as may be expressly required by applicable law, Acasta does not undertake any obligation to update publicly or revise any such forward looking statements, whether as a result of new information, future events or otherwise. These cautionary statements expressly qualify all forward looking statements in this new release.