CPE News (12/18/2020) – Constellation Software Inc. (TSX: CSU), acting through its TSS operating group and its subsidiary TPCS Holding B.V., entered into a binding agreement with IJssel B.V. to purchase 100% of the shares of Topicus.com B.V., a Netherlands-based diversified vertical market software provider, for €217.4 million
In connection with the anticipated closing of the acquisition and the subsequent public listing of the subordinate voting shares of Topicus.com Inc., TSS will be spun out of Constellation and will operate together with Topicus as a separate publicly traded company.
Constellation common shareholders of record on December 28, 2020 will be entitled to receive, by way of a dividend-inkind, 1.859817814 subordinate voting shares of Topicus.com Inc. for each common share of Constellation held. The payment date for the Dividend is expected to be on or about January 4, 2021. The common shares of Constellation will commence trading on an ex-dividend basis at the opening of markets on December 23, 2020. CSI currently has 21,191,530 common shares outstanding.
The spin-out shares have been conditionally approved for listing on the TSX Venture Exchange. Trading of the spin-out shares is expected to begin approximately 30 days following completion of the acquisition of Topicus.com B.V.
Topicus.com Inc. is a newly-created wholly-owned subsidiary of Constellation Software Inc. The business of Topicus.com Inc. will be comprised of (i) what is currently TSS operating group, and the business carried on by Topicus.com B.V.
Following the spin-out and the acquisition, Topicus.com Inc. will indirectly own a 60.7% interest in the business. The remaining 39.3% interest in the business will be owned indirectly by Joday Investments II B.V.and certain individual affiliated investors (30.3%) and IJssel B.V. (9.0%).
CSI will own preferred shares of Topicus.com Inc. that will have a cumulative dividend entitlement of 5% and a redemption amount equal to the fair market value of Topicus.com Inc. at the time of the dividend. CSI will have the right to cause the redemption of those preferred shares at any time, subject to certain conditions. As a result, the Spin-Out Shares are expected to have a nominal fair market value at the time of the dividend.
On a fully-diluted basis, Topicus.com Inc. will have 129,841,818 Subordinate Voting Shares issued and outstanding, of which approximately 39,412,364 Subordinate Voting Shares would be held by public shareholders, approximately 21 Subordinate Voting Shares would be held by CSI, 39,412,385 Subordinate Voting Shares would be held by CSI (upon the conversion of the Preferred Shares), 39,331,284 Subordinate Voting Shares would be held by the Joday Group (upon the exchange of the exchangeable units held by the Joday Group), and 11,685,764 Subordinate Voting Shares would be held by IJssel (upon the exchange of the exchangeable units held by Ijssel). In addition, CSI would hold one additional Subordinate Voting Share upon the conversion of the Super Voting Share.
The 1 Super Voting Share held by Constellation carries 50.1% of total voting power. Following the conversion of all of the Preferred Shares that are held by Constellation into Subordinate Voting Shares, Constellation Software Inc. will hold 65.25% of the total voting rights on a fully-diluted basis.
Topicus.com acquires, manages and builds vertical market software (VMS) businesses, primarily located in the Netherlands.
photo credit: TSS
News Release
Constellation Software Inc. Files Final Prospectus and Declares Dividend in Connection with Proposed Topicus.com Spin Out
TORONTO, Dec. 18, 2020 —
As previously announced, on May 20, 2020, Constellation Software Inc. (“Constellation”) (TSX:CSU), acting through its TSS operating group and its subsidiary TPCS Holding B.V., entered into a binding agreement with IJssel B.V. to purchase 100% of the shares of Topicus.com B.V. (“Topicus”), a Netherlands-based diversified vertical market software provider. In connection with the anticipated closing of the acquisition and the subsequent public listing of the subordinate voting shares of Topicus.com Inc., TSS will be spun out of Constellation and will operate together with Topicus as a separate publicly traded company.
Constellation announced today that it has filed and obtained a receipt for a final prospectus with the securities regulatory authorities in each of the provinces and territories of Canada in connection with the proposed spin-out.
Constellation also announced today that it has resolved to pay a special dividend (the “Dividend”) pursuant to which all common shareholders of record on December 28, 2020 (the “Record Date”) will be entitled to receive, by way of a dividend-inkind, 1.859817814 subordinate voting shares of Topicus.com Inc. (the “Spin-Out Shares”) for each common share of Constellation held. The payment date for the Dividend is expected to be on or about January 4, 2021. As both December 25 and 28, 2020 are statutory holidays in Canada, the common shares of Constellation will commence trading on an ex-dividend basis at the opening of markets on December 23, 2020.
The Spin-Out Shares have been conditionally approved for listing on the TSX Venture Exchange, subject to Topicus.com Inc. fulfilling all of the listing requirements. Trading of the Spin-Out Shares on the TSX Venture Exchange is expected to begin approximately 30 days following completion of the acquisition of Topicus.
About Total Specific Solutions
TSS is one of Constellation’s six Operating Group companies, based in the Netherlands and solely focused on the European vertical market software industry.
About Topicus
Topicus is a Netherlands based leader in building and running smart vertical market software since 2001. Their focus is on innovation through vertical market integration. Topicus connects organizations, professionals and end users within and across the vertical markets of education, healthcare, municipalities and financial services.
About Constellation Software Inc.
Constellation acquires, manages and builds vertical market software businesses that provide mission-critical software solutions.
For further information, contact:
Constellation Software Inc.
Jamal Baksh, Chief Financial Officer
Tel: (416) 861-9677
jbaksh@csisoftware.com www.csisoftware.com