Birch Hill to dispose $121.87M Softchoice shares, part of $150M bought deal

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By CPE News

CPE News (10/9/2021) – Softchoice Corporation (TSX: SFTC) has filed its final short-form prospectus in connection with previously announced $150 million bought deal of primary by Softchoice and secondary offering by selling shareholders

5,085,000 common shares will be offered at a price of $29.50 for total gross proceeds of approximately $150 million. 360,423 common shares will be issued from treasury by Softchoice for gross proceeds of approximately $11 million and 4,724,577 common shares will be sold by the selling shareholders for aggregate gross proceeds to the selling shareholders of approximately $139 million.

Softchoice has finally disclosed the breakdown by the selling shareholders:
Birch Hill Equity Partners IV family of funds – 4,131,154 shares for gross proceeds of $121,869,043
Keika Limited – 420,117 shares for $12,393,452
Individual selling shareholders (directors and management) – 173,306 shares for $5,112,527

Birch Hill Equity Partners IV will continue to own 27,156,120 shares (45.6%) of Softchoice outstanding shares following the closing, or 26,463,778 shares (44.5%) if the over-allotment option is exercised in full.

Keika Limited will own 2,761,639 shares (4.6%) following the close or 2,691,231 shares (4.6%) if the over-allotment option is exercised in full.

Keika Limited and Madidus Limited, listed as “Co-Investors” by Softchoice, together with Birch Hill funds sold 13,125,000 common shares at $20.00 for gross proceeds of $262.5 million as part of Softchoice’s initial public offering (IPO) and con-current secondary sales. Softchoice did not provide any information on the Co-Investors and the breakdown of 13.125 milllion shares.

Based on information provided, Madidus Limited, which is not part of the secondary offering, will continue to own 2,625,000 shares.

The offering underwriting syndicate is co-led by TD Securities Inc. and Goldman Sachs Canada Inc. and including CIBC World Markets Inc., RBC Dominion Securities Inc., National Bank Financial Inc., Scotia Capital Inc., BMO Nesbitt Burns Inc., ATB Capital Markets Inc., Cormark Securities Inc., Laurentian Bank Securities Inc., Canaccord Genuity Corp. and Raymond James Ltd.

Stikeman Elliott LLP and Davies Ward Phillips & Vineberg LLP acted as legal counsel to Softchoice and the underwriters respectively.

The offering is expected to close on or about October 15, 2021 or no later than October 27, 2021.

Softchoice (TSX: SFTC) is a technology services and solutions provider that equips organizations to be agile and innovative, and for their people to be engaged, connected and creative at work.

photo credit: Softchoice