CPE News (2.27.2023) – CGI (TSX: GIB.A; NYSE: GIB) intends to enter into a private agreement with CDPQ for the purchase for cancellation of 3,344,996 of its Class A subordinate voting shares held by CDPQ for a price of $119.58 per Class A share for a consideration of $399,994,621.68.
The share repurchase will be made under CGI’s normal course issuer bid (NCIB) pursuant to which CGI is authorized to repurchase up to 18,769,394 Class A Shares by February 5, 2024.
As at December 5, 2022, CGI had purchased for cancellation 6,449,173 Class A subordinate voting shares under its current NCIB for an approximate aggregate cash consideration of $656.8 million at a weighted average price of $101.84 per share. The repurchased shares included 3,968,159 and 938,914 Class A subordinate voting shares purchased for cancellation on March 1, 2022 and on August 1, 2022 from Caisse de dépôt et placement du Québec for an aggregate cash consideration of $500 million, by way of private agreements.
As at December 5, 2022, CGI had 211,759,994 Class A subordinate voting shares and 26,445,706 Class B shares issued and outstanding, with 44.47% and 55.53% of the aggregate voting rights attached to the outstanding Class A subordinate voting shares and Class B shares, respectively.
Once the repurchases in completed, CDPQ, currently the only 10%+ holder of Class A shares, will continue to hold approximately 19.18 million Class A Shares, representing approximately 8.16% of CGI’s total outstanding shares.
Serge Godin, founder and Executive Chairman, controls 25,545,706 Class B shares (96.6%) with remaining 900,000 Class B shares held by André Imbeau, founder and Advisor to the Executive Chairman.
Founded in 1976, CGI is among the largest independent IT and business consulting services firms in the world. With 90,250 consultants and professionals across the globe, CGI delivers an end-to-end portfolio of capabilities, from strategic IT and business consulting to systems integration, managed IT and business process services and intellectual property solutions.
photo credit: CGI
CGI announces intent to repurchase 3.34 million of its shares held by CDPQ
MONTRÉAL, Feb. 27, 2023 /CNW/ – CGI (TSX: GIB.A) (NYSE: GIB) announced today that it intends to enter into a private agreement with CDPQ for the purchase for cancellation of 3,344,996 of its Class A subordinate voting shares (“Class A Shares”) held by CDPQ for a price of $119.58 per Class A Share, which represents a discount to the closing price on February 24, 2023 of the Class A Shares on the Toronto Stock Exchange (“TSX”).
The transaction will be made in connection with the periodic portfolio rebalancing of CDPQ. Once completed, CDPQ will continue to hold approximately 19.18 million Class A Shares, representing approximately 8.16% of CGI’s total outstanding shares.
“CGI continues to produce excellent results for its shareholders and this share repurchase is an opportunity to monetize a portion of our investment to the benefit of our depositors. Furthermore, we plan to reinvest this amount in Québec companies,” said Kim Thomassin, Executive Vice-President and Head of Québec at CDPQ. “Following this transaction, CDPQ will remain one of the main shareholders of CGI, and we intend to continue supporting the company. CGI is a world leader in information technology that is well positioned to continue finding success in both Québec and international markets.”
“This transaction is consistent with our value creation strategy and is immediately accretive to our shareholders,” said Julie Godin, Co-Chair of the Board, CGI. “CGI has the strength and capital resources to execute on our Build and Buy profitable growth strategy given our strong balance sheet and excellent cash generation, combined with $2.8 billion of cash readily available at the end of December 2022.”
A favourable decision was obtained from the Autorité des marchés financiers (AMF) to exempt CGI from the issuer bid requirements under applicable securities legislation. The transaction will be entered into at a discount, in accordance with the decision of the AMF, and is expected to be entered into later today and settled on February 28, 2023.
The share repurchase will be made under CGI’s normal course issuer bid (“NCIB”), the renewal of which was announced on February 1, 2023. Under the NCIB, CGI is authorized to repurchase up to 18,769,394 Class A Shares by February 5, 2024. The NCIB allows for purchases outside the facilities of the TSX by private agreements pursuant to exemption orders issued by securities regulators. As at February 24, 2023, CGI had not repurchased any Class A Shares under its current NCIB.
Information regarding the share repurchase, including the number of Class A Shares purchased for cancellation and aggregate price paid, will be available on the SEDAR website at sedar.com following the completion thereof. CGI will not issue any additional press release in respect of this share repurchase.
Founded in 1976, CGI is among the largest independent IT and business consulting services firms in the world. With 90,250 consultants and professionals across the globe, CGI delivers an end-to-end portfolio of capabilities, from strategic IT and business consulting to systems integration, managed IT and business process services and intellectual property solutions. CGI works with clients through a local relationship model complemented by a global delivery network that helps clients digitally transform their organizations and accelerate results. CGI Fiscal 2022 reported revenue is $12.87 billion and CGI shares are listed on the TSX (GIB.A) and the NYSE (GIB). Learn more at cgi.com.
At CDPQ, we invest constructively to generate sustainable returns over the long term. As a global investment group managing funds for public retirement and insurance plans, we work alongside our partners to build enterprises that drive performance and progress. We are active in the major financial markets, private equity, infrastructure, real estate and private debt. As at December 31, 2022, CDPQ’s net assets totalled CAD 402 billion. For more information, visit cdpq.com, follow us on Twitter or consult our Facebook or LinkedIn pages.
CDPQ is a registered trademark owned by Caisse de dépôt et placement du Québec and licensed for use by its subsidiaries.
Forward-looking information and statements
This press release contains “forward-looking information” within the meaning of Canadian securities laws and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and other applicable United States safe harbours. All such forward-looking information and statements are made and disclosed in reliance upon the safe harbour provisions of applicable Canadian and United States securities laws. Forward-looking information and statements include all information and statements regarding CGI’s intentions, plans, expectations, beliefs, objectives, future performance, and strategy, as well as any other information or statements that relate to future events or circumstances and which do not directly and exclusively relate to historical facts. Forward-looking information and statements often but not always use words such as “believe”, “estimate”, “expect”, “intend”, “anticipate”, “foresee”, “plan”, “predict”, “project”, “aim”, “seek”, “strive”, “potential”, “continue”, “target”, “may”, “might”, “could”, “should”, and similar expressions and variations thereof. These information and statements are based on our perception of historic trends, current conditions and expected future developments, as well as other assumptions, both general and specific, that we believe are appropriate in the circumstances. Such information and statements are, however, by their very nature, subject to inherent risks and uncertainties, of which many are beyond the control of CGI, and which give rise to the possibility that actual results could differ materially from our expectations expressed in, or implied by, such forward-looking information or forward-looking statements. These risks and uncertainties include but are not restricted to: risks related to the market such as the level of business activity of our clients, which is affected by economic and political conditions, additional external risks (such as pandemics, armed conflict, climate-related issues and inflation) and our ability to negotiate new contracts; risks related to our industry such as competition and our ability to develop and expand our services, to penetrate new markets, and to protect our intellectual property rights; risks related to our business such as risks associated with our growth strategy, including the integration of new operations, financial and operational risks inherent in worldwide operations, foreign exchange risks, income tax laws and other tax programs, our ability to attract and retain qualified employees, to negotiate favourable contractual terms, to deliver our services and to collect receivables, to disclose, manage and implement environmental, social and governance (ESG) initiatives and standards, as well as the reputational and financial risks attendant to cybersecurity breaches and other incidents, and financial risks such as liquidity needs and requirements, maintenance of financial ratios, interest rate fluctuations and the discontinuation of major interest rate benchmarks and changes in creditworthiness and credit ratings; as well as other risks identified or incorporated by reference in this press release, in CGI’s annual and quarterly MD&A and in other documents that we make public, including our filings with the Canadian Securities Administrators (on SEDAR at www.sedar.com) and the U.S. Securities and Exchange Commission (on EDGAR at www.sec.gov). Unless otherwise stated, the forward-looking information and statements contained in this press release are made as of the date hereof and CGI disclaims any intention or obligation to publicly update or revise any forward-looking information or forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. While we believe that our assumptions on which these forward-looking information and forward-looking statements are based were reasonable as at the date of this press release, readers are cautioned not to place undue reliance on these forward-looking information or statements. Furthermore, readers are reminded that forward-looking information and statements are presented for the sole purpose of assisting investors and others in understanding our objectives, strategic priorities and business outlook as well as our anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes. Further information on the risks that could cause our actual results to differ significantly from our current expectations may be found in the section titled Risk Environment of CGI’s annual and quarterly MD&A, which is incorporated by reference in this cautionary statement. We also caution readers that the above-mentioned risks and the risks disclosed in CGI’s annual and quarterly MD&A and other documents and filings are not the only ones that could affect us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial could also have a material adverse effect on our financial position, financial performance, cash flows, business or reputation.
SOURCE CGI Inc.
For further information: CGI: Kevin Linder, Senior Vice-President, Investor Relations, email@example.com, +1 905-973-8363; CDPQ: Media Relations, firstname.lastname@example.org, +1 514-847-5493