CanWel announces $35M bought deal led by GMP Securities

CanWel Building Materials Group completed $40M bought deal led by GMP Securities L.P.

Vancouver (pcJ News Briefs) – CanWel Building Materials Group Ltd. (TSX: CWX) has engaged GMP Securities L.P. as lead agent for a bought deal of 5,737,800 common shares at $6.10 per share for gross proceeds of approximately $35.0 million.

The underwriting syndicate also includes National Bank Financial Inc., Canaccord Genuity Corp., Haywood Securities Inc., Raymond James Ltd., and Cormark Securities Inc.
The Company has granted the underwriters an over-allotment option to purchase up to an additional 860,670 shares at the offering price for a period of up to 30 days. If this option is exercised in full, an additional $5.25 million will be raised and the aggregate gross proceeds will be $40.25 million.

Net proceeds will be used to initially reduce indebtedness under CanWel’ existing revolving credit facility, which is expected to be drawn in the future to fund potential acquisition opportunities, and for general working capital requirements. Specifically, CanWel is evaluating additional acquisitions of U.S. and Canadian pressure-treated wood operations and expects to announce any acquisitions in due course once definitive agreements are reached.

“This financing provides us the equity capital for our continued strategy of acquiring established pressure-treated wood operations across North America and consolidating our industry. The attractive valuations, higher margins and potential for integration with existing wood treatment and forestry operations makes this ongoing roll-up initiative accretive to CanWel,” said Amar Doman, Chairman & CEO of CanWel.

Founded in 1989, CanWel is Canada’s only fully integrated national distributor in the building materials and related products sector. CanWel operates multiple treating plant and planing facilities in Canada and the United States, and operates distribution centres coast- to-coast in all major cities and strategic locations across Canada and near San Francisco and Los Angeles, California.