Business
Allen-Vanguard announces completion of acquisition of Med-Eng Systems Inc.
Allen-Vanguard announces completion of acquisition of Med-Eng Systems Inc..
About this update from Verisante Technology, Inc.
[{"type":"text","content":"\n\n\n\n- Company pays approximately $600 million to acquire Med-Eng\n- $200 million prospectus offering announced to reduce debt\n- Scale brings global leadership position in protection and counter\n measures against terrorist devices, IEDs\n\n\nOTTAWA, Sept. 17 /CNW Telbec/ - Allen-Vanguard Corporation (the "Company"\nor "Allen-Vanguard") (TSX: VRS) of Ottawa, Canada announced today that it has\ncompleted the previously announced acquisition of Med-Eng Systems Inc,\n("Med-Eng").\n\n\nUnder the terms of the all-cash agreement, Allen-Vanguard paid\napproximately $600 million at closing to purchase all the shares of Med-Eng on\na debt and cash free basis, plus approximately $40 million for excess working\ncapital. All amounts are in Canadian dollars unless otherwise noted.\n\n\nThe transaction was funded through a combination of\n- $94 million in a subscription receipt private placement for\n approximately 14.6 million common shares of the Company at a price of\n $6.85 per share ("Private Placement");\n- Approximately $350 million (US $341 million translated at a rate of\n $1.03 on closing) in five-year term debt financing ("Senior Debt\n Facility") at LIBOR plus 7%.\n- Approximately $190 million of notes issued to the shareholders of\n Med-Eng ("Vendor Notes"). The Vendor Notes mature on December 31, 2007,\n subject to potential extension, and bear interest at 10% per annum. A\n consortium of lenders has agreed to purchase approximately $150 million\n of the Vendor Notes from the vendors on October 1, 2007 ("Vendor Note\n Purchase") to the extent that the Vendor Notes remain outstanding on\n that date;\n\n\nThe Company also arranged a $20 million revolving credit facility\n("Revolver Facility"), of which $10 million was drawn on closing. Prior to\nclosing, the Company repaid approximately $8.8 million to Bank of Scotland to\nretire existing indebtedness, including a term loan, working capital facility\nand letters of credit.\n\n\nTransaction costs, including agent commissions on the Private Placement,\ncommitment fees on the Senior Debt Facility, Revolver Facility, Vendor Note\nPurchase and legal and financial advisory fees total approximately\n$34.1 million of cash, funded through the Revolver Facility and the Company's\nexisting cash reserves, plus...