/THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT
AUTHORIZED OR INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE
SERVICES OR FOR PUBLICATION OR DISSEMINATION IN THE UNITED STATES/
OTTAWA, Sept. 27 /CNW Telbec/ - Allen-Vanguard Corporation ("Allen-Vanguard" or the "Company") (TSX:VRS) reported today that it has closed its previously announced public offering of common shares (the "Offering"), for gross proceeds of $300,010,000.
A syndicate of underwriters, led by Genuity Capital Markets and including Paradigm Capital Inc., Versant Partners Inc. and Canaccord Adams (together, the "Underwriters") purchased an aggregate of 31,580,000 common shares of the Company at a price of $9.50 per common share. Oppenheimer & Co. Inc. participated as a special selling group member in the Offering of common shares on an exempt basis in the United States. In addition, the Company has granted the Underwriters an option to purchase up to an additional 4,737,000 common shares (equal to 15% of the Offering) at the issue price of $9.50 per common share, which option shall be exercisable for 30 days following the closing of the Offering.
The net proceeds from the Offering will be used to repay certain debt obligations incurred by the Company pursuant to the acquisition of Med-Eng Systems Inc. ("Med-Eng"). The net proceeds from the Offering will be used, in order of priority: (i) to repay to the vendors of Med-Eng (a) $150 million of subordinated debt (plus accrued interest thereon); and (b) approximately $40.6 million of subordinated debt (plus accrued interest thereon) representing the excess working capital of Med-Eng at the closing of the acquisition of Med-Eng; and (ii) to repay outstanding borrowings on the revolving credit facility (the "Revolver") and a portion of the term debt facility (the "Term Debt Facility").
"We are very pleased with the success of this offering, which exceeded our target objective," said David E. Luxton, Company President and CEO. "It attracted several new U.S. and Canadian institutional investors, as well as additional investment from a number of existing institutional shareholders. We extend a warm welcome to our new shareholders, and thank all investors in this offering for their strong vote of confidence."
Concurrent with the closing of the Offering, the Company issued an aggregate of 3,575,100 common share purchase warrants (the "Share Purchase Warrants") to arrangers of the Revolver and Term Debt Facility or their affiliates, which Share Purchase Warrants were qualified for distribution by the final short form prospectus filed by the Company on September 21, 2007. Each Share Purchase Warrant entitles the holders to acquire one common share of the Company at an exercise price of $9.50 per common share until September 27, 2014.
With this issue of 31,580,000 shares, and the earlier issue of 14,650,000 shares at $6.85 pursuant to the private placement which closed on August 15, 2007, the Company now has approximately 105.3 million shares outstanding (basic), or 113.1 million shares on a fully diluted basis. Shareholders' equity, on a pro forma basis at June 30, was approximately $506.3 million.
This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not and will not be registered under the United States Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold within the United States or to U.S. Persons (as such term is defined in Regulation S of the United States Securities Act of 1933, as amended) unless an exemption from such registration is available. This press release shall not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.
About Allen-Vanguard
Allen-Vanguard Corporation supports the mission of military and homeland security forces around the world with leading proprietary solutions for protection and counter-measures against hazardous devices of all kinds, whether chemical, biological, radiological or explosive (CBRNE), including improvised explosive devices (IEDs) and remotely controlled IEDs (RCIEDs). Allen-Vanguard equipment is in service in more than 120 countries. Products include Electronic Counter-Measures ("ECM") equipment for jamming remote detonation of terrorist devices, specialty security equipment for Explosive Ordnance Disposal ("EOD"), remote intervention robots for hazardous applications, and personal protective wear for use in dealing with explosive and bio-chemical agents. Allen-Vanguard is the developer and/or sole, worldwide licensee of proprietary technologies such as the Med-Eng bomb suit, the Defender(TM) and Vanguard(TM) Mk2 bomb disposal robots, and the Universal Containment System and CASCAD Foam system for blast mitigation and decontamination of bio-chemical warfare agents. Professional services encompass counter-IED intelligence, training and advisory services, including the Triton(TM) Report on terrorist incidents around the world. The Company operates globally through its wholly-owned subsidiaries under the names "Allen-Vanguard", "Med-Eng" and "Hazard Management Solutions". Head office operations are located in Ottawa, Ontario, Canada, with manufacturing operations in Stoney Creek and Pembroke, Ontario; Ogdensburg, New York; Tewkesbury, U.K.; and Cork, Ireland; The Company has professional services operations in Shrivenham, UK, and in the U.S. in Arlington, Virginia, plus sales offices in Canada, the U.S., the U.K. and Asia. Allen-Vanguard's shares are listed on The Toronto Stock Exchange (TSX) under the symbol "VRS".
This press release may contain forward-looking statements, which reflect Allen-Vanguard's current expectations regarding future events, its strategy, expected performance and condition. Forward-looking statements include statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as "expects," "anticipates," "plans," "believes," "estimates" or negative versions thereof and similar expressions. In addition, any statement that may be made concerning future performance, strategies or prospects, and possible future acquisitions or dispositions, is also a forward-looking statement. Forward-looking statements are based on current expectations and projections about future events and are inherently subject to, among other things, risks, uncertainties and assumptions about the Company and economic factors. Forward-looking statements are not promises or guarantees of future performance, and actual events and results could differ materially from those expressed or implied in any forward-looking statements made about the Company. Any number of important factors could contribute to these digressions, including, but not limited to, general economic, political and market factors in North America and internationally, interest and foreign exchange rates, global equity and capital markets, business competition, technological change, changes in government regulations, unexpected judicial or regulatory proceedings, and catastrophic events. We stress that the above-mentioned list of important factors is not exhaustive. We encourage you to consider these and other factors carefully before making any investment decision and we urge you to avoid placing undue reliance on forward-looking statements. Further, you should be aware that the Company disclaims any obligation to publicly update or revise any such forward-looking statements whether as a result of new information, future events or otherwise, prior to the release of the next Management Discussion and Analysis to be released by the Company or except as required by law .
To find out more about Allen-Vanguard Corporation (TSX: VRS), visit our website at www.allen-vanguard.com.
%SEDAR: 00018026E