CPE News (9/13/2021) – Funds affiliated with Oaktree Capital Management, L.P. have entered into a share purchase agreement with ABC Group Canada LP, an affiliate of funds managed by Cerberus Capital Management, L.P. to purchase its remaining equity interest in ABC Technologies Holdings Inc. (TSX: ABCT)
Under the terms of the agreement, OCM Luxembourg OPPS XI S.à.r.l. and OCM Luxembourg OPPS XB S.à.r.l. will purchase at closing 13,854,412 common shares of ABC Technologies for CDN $9.00 per share, representing aggregate consideration of approximately CDN $124.7 million.
Upon closing the transaction, Oaktree Capital Management, L.P. will join controlling shareholder Apollo Global Management, Inc. (NYSE: APO) as significant minority shareholder in ABC Technologies Holdings Inc.
In June 2021, AP IX Alpha Holdings (Lux) S.a r.l., a fund managed by Apollo Global Management acquired 27,667,980 common shares of ABC Technologies (representing approximately 51% of the fully-diluted ABCT shares) from ABC Group Canada LP at the USD equivalent of CDN $10.00 (US $7.97) per ABC share for approximately US $220.5 million or CDN $276.7 million.
As of closing and assuming the number of issued and outstanding ABCT common shares on a non-diluted basis as of closing is 52,522,392 and on a fully diluted basis as of closing is 54,250,942, the ownership of ABC Technologies Holdings Inc. will be as follows
- The Apollo fund – 27,667,980 ABCT shares, representing approximately 52.7% of the issued and outstanding ABC shares or 51.0% of the issued and outstanding ABCT shares on a fully-diluted basis
- Oaktree Capital Management funds – 13,854,412 ABCT shares, representing approximately 26.4% of the issued and outstanding ABCT shares or approximately 25.5% of the issued and outstanding ABC shares on a fully-diluted basis
- Public shareholders – approximately 11.0 million ABCT shares, representing approximately 20.9% of the issued and outstanding ABCT shares.
ABC Group Canada LP will no longer own or control any of the issued and outstanding common shares of ABC Technologies Holdings Inc.
Toronto based ABC Technologies is a leading manufacturer and supplier of custom, highly engineered, technical plastics and lightweighting innovations to the North American light vehicle industry, serving more than 25 original equipment manufacturer customers globally through a strategically located footprint.
photo credit: ABC Technologies Group Inc.
News Release
Oaktree to Acquire Minority Stake of ABC Technologies Holdings Inc. from Cerberus
LOS ANGELES and NEW YORK, Sept. 13, 2021 /CNW/ – Funds affiliated with Oaktree Capital Management, L.P. (“Oaktree”) and ABC Group Canada LP (“ABC LP”), an affiliate of funds managed by Cerberus Capital Management, L.P. (“Cerberus”), announced today that Oaktree Funds (as defined below) have entered into a share purchase agreement (the “Agreement”) with ABC LP to purchase its remaining equity interest in ABC Technologies Holdings Inc. (“ABC Technologies” or the “Company”) (TSX: ABCT) (the “Acquisition”).
Under the terms of the Agreement, OCM Luxembourg OPPS XI S.à.r.l. (“OPPS XI”) and OCM Luxembourg OPPS XB S.à.r.l. (collectively, the “Oaktree Funds”) will purchase at closing 13,854,412 common shares of the Company (the “Common Shares”) from ABC LP for CAD$9.00 per share, representing aggregate consideration of approximately CAD$124.7 million.
At closing, ABC LP will assign to OPPS XI its rights under an amended and restated investor rights agreement dated as of June 24, 2021 among the Company, ABC LP and AP IX Alpha Holdings (Lux) S.à.r.l., which will provide OPPS XI with, among other things, certain director nomination rights, registration rights, pre-emptive rights and information rights relating to the Company. Following the closing, OPPS XI will be entitled to nominate three of the nine members of the board of directors of the Company.
Brook Hinchman, Co-Head of North America for Oaktree’s Global Opportunities strategy, said, “We are excited by the opportunity to invest in ABC Technologies. We believe the future of the Company is bright and see it as a beneficiary of the key trends of light weighting and electrification in the automotive industry. ABC Technologies is well suited to be a consolidator in the automotive technical plastic space, and Oaktree looks forward to supporting the Company and its strong management team led by Todd Sheppelman.”
Dev Kapadia, Cerberus Senior Managing Director, commented, “It has been an incredible journey with the ABC Technologies team over the past five years. Together, we have transformed ABC Technologies into a market-leading, publicly-traded company with compelling growth opportunities ahead. We look forward to following the Company’s continued success in its next chapter with the support of new strategic partners.”
Closing of the Acquisition is subject to customary closing conditions including the receipt of applicable regulatory approvals in Canada, United States and Mexico, among others.
The Acquisition is exempt from the take-over bid requirements of applicable Canadian securities law.
As at the date hereof, (i) ABC LP, directly or indirectly, beneficially owns or controls 13,854,412 Common Shares, representing approximately 26.4 % of the issued and outstanding common shares of the Company (or approximately 25.5 % of the issued and outstanding common shares on a fully-diluted basis), and (ii) Oaktree and the Oaktree Funds beneficially own or control, directly or indirectly, none of the issued and outstanding common shares of the Company. Following completion of the Acquisition, ABC LP will no longer own or control any of the issued and outstanding common shares of the Company, while Oaktree (through the Oaktree Funds) will own 13,854,412 Common Shares, representing approximately 26.4% of the issued and outstanding common shares of the Company (or approximately 25.5 % of the issued and outstanding common shares on a fully-diluted basis) (assuming the number of issued and outstanding common shares on a non-diluted basis as of closing is 52,522,392 and on a fully diluted basis as of closing is 54,250,942).
This press release is being issued pursuant to National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issues (“NI 62-103”) in connection with the Acquisition. Oaktree and ABC LP will also each file an early warning report pursuant to NI 62-103 with the securities regulators in each of the provinces and territories of Canada with respect to the foregoing matters, a copy of which will be available under the Company’s profile on the System for Electronic Document Analysis and Review (SEDAR) at www.sedar.com. A copy of (i) Oaktree’s early warning report may also be obtained by contacting Ivan Grbešić of Stikeman Elliott LLP, on behalf of Oaktree, at igrbesic@stikeman.com, and (ii) ABC LP’s early warning report may also be obtained by contacting Torrey Leroy, Cerberus Communications, at media@cerberus.com.
Following completion of the Acquisition, Oaktree intends to hold the Common Shares for investment purposes. Subject to compliance with applicable laws, Oaktree may determine to acquire additional common shares of the Company or dispose of Common Shares through market transactions, public offerings, private agreement or otherwise, depending upon the price of the Common Shares, market conditions, economic conditions and other factors.
No securities regulatory authority has either approved or disapproved the contents of this news release.
About Oaktree
Oaktree is a leader among global investment managers specializing in alternative investments, with $156 billion in assets under management as of June 30, 2021. The firm emphasizes an opportunistic, value-oriented and risk-controlled approach to investments in credit, private equity, real assets and listed equities. The firm has over 1,000 employees and offices in 19 cities worldwide. For additional information, please visit Oaktree’s website at http://www.oaktreecapital.com/.
About Cerberus
Founded in 1992, Cerberus is a global leader in alternative investing with over $55 billion in assets across complementary credit, private equity, and real estate strategies. Cerberus invests across the capital structure where its integrated investment platforms and proprietary operating capabilities create an edge to improve performance and drive long-term value. Its tenured teams have experience working collaboratively across asset classes, sectors, and geographies to seek strong risk-adjusted returns for investors. For more information about Cerberus, please visit www.cerberus.com.
About ABC LP
ABC LP is a limited partnership existing under the laws of the province of Ontario, that is, through one or more intermediary entities, indirectly controlled by Cerberus Capital Management, L.P. ABC LP’s registered office address is 199 Bay Street, Toronto, Ontario, Canada M5L 1A9.
SOURCE Oaktree Capital Management, L.P.
For further information: about Oaktree, please contact: mediainquiries@oaktreecapital.com; For further information about Cerberus or ABC LP, please contact: Torrey Leroy, +1 (646) 885-3029, media@cerberus.com