Acasta Enterprises Inc. (TSX: AEF) has reached an agreement to extend the repayment of US $25 million under its US $150 million credit facility from March 1 to March 7.
On February 6, 2018, Acasta announced the entering into a non-binding term sheet with Martello Finance Company Limited to sell Stellwagen Group Limited and an amending agreement to the US $150 million credit facility.
The amending agreement required that Acasta repay US $25 million to the lenders under the credit facility by no later than March 1, 2018, the funding of which was to be derived from the sale of Stellwagen or certain of its assets.
On January 3, 2017, as part of qualifying acquisition, Acasta Enterprises acquired all of the issued and outstanding equity interests comprising Stellwagen for a total purchase price equal to CDN $324,829,923, and satisfied by (i) the delivery of CDN $96,545,743 in cash, and (ii) the issuance of 22,828,418 Class B Shares at CDN $10.00 per share.
On February 6, 2018, Acasta signed a term sheet to sell Stellwagen to an affiliate of Martello, the previous owner of Stellwagen, in exchange for the cancellation of 26 million common shares of Acasta beneficially owned by Martello and others, representing approximately 27% of the issued and outstanding common shares, and the payment to Acasta of US $35 million. Acasta will retain the Stelloan loan portfolio which has a book value of approximately US $47.4 million.
Acasta paid $852.6 million for its qualifying acquisition (Stellwagen, JemPak, Apollo Health and Beauty Care), $300 million of which was paid in cash.
Acasta’s stock closed at CDN $3.10 on March 1, 2018 with a market cap of CDN $296.717 million.
photo credit: Acasta Enterprises
News Release
Acasta reaches Extension Agreement with Lenders under its U.S.$150 Million Credit Facility
TORONTO, Thursday, March 1, 2018 – On February 6, 2018, Acasta Enterprises Inc. (TSX: AEF) (“Acasta” or the “Company”) announced it entered into a non-binding term sheet (the “Term Sheet”) with Martello Finance Company Limited to sell Stellwagen Group Limited (“Stellwagen”) and an amending agreement (the “Amending Agreement”) to its U.S. $150 million credit facility (the “Credit Facility”). The Amending Agreement required that Acasta repay U.S.$25 million to the lenders under the Credit Facility by no later than March 1, 2018, the funding of which was to be derived from the sale of Stellwagen or certain of its assets.
The Company announced today that the parties to the Term Sheet have been working cooperatively and intensively since the signing of the Term Sheet and the definitive documents are in the process of being finalized. To facilitate entering into definitive agreements with respect to the sale of Stellwagen, Acasta has entered into an extension agreement with the lenders under the Credit Facility to extend the deadline for payment of U.S.$25 million that was due today until March 7, 2018.
As previously disclosed, the Board of Directors of Acasta has appointed a special committee of independent directors (the “Independent Committee”) to, among other things, oversee the potential sale of Stellwagen and consider other alternatives to maximize value for the Company’s shareholders. The Independent Committee has retained the services of Blair Franklin Capital Partners Inc. to provide independent financial advice and has engaged Osler, Hoskin & Harcourt LLP as independent legal advisor to the Independent Committee.
For further information
Acasta Enterprises Inc.
Ian Kidson, 1-647-725-6707
Chief Financial Officer and Chief Operating Officer
www.acastaenterprises.com