Pender West backed Premium Brands closes $172.7M Oberto acquisition financing

Premium Brands Holdings Corporation (TSX: PBH), a portfolio company of Pender West Investors Inc., has completed previously announced offering of 1,472,000 subscription receipts at $117.35 per subscription receipt for gross proceeds of approximately $172.7 million.

Net proceeds of the offering will be used to finance, in part, the previously announced acquisition of substantially all of the assets and business undertakings of the meat snack business of Oberto Sausage Company.

Each subscription receipt represents the right of the holder to receive, upon the satisfaction or waiver of the closing conditions contained in the Oberto’s acquisition agreement, without additional payment, one common share in the capital of Premium Brands with all rights attached the common shares.

Pender West did not disclose its participation in the offering. Upon closing of the acquisition and conversion of all subscription receipts, Pender West Capital Partners Inc., through Pender West Investors Inc., will see its shareholding reducing from #Subscribers ONLY – where and how did you get your news? Subscribe today to see our research on this and all other subscriber ONLY news. Be informed!#

photo credit: Oberto Sausage Company

News Release

Premium Brands Holdings Corporation Announces Completion of $172.7 Million Offering of Subscription Receipts

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.

Vancouver, B.C., May 2, 2018. Premium Brands Holdings Corporation (“Premium Brands” or the “Company”) (TSX:PBH), a leading producer, marketer and distributor of branded specialty food products, is pleased to announce the successful closing of the issue and sale of 1,472,000 subscription receipts (the “Subscription Receipts”) at a price of $117.35 per Subscription Receipt, for gross proceeds of approximately $172.7 million (the “Offering”).

The Subscription Receipts were offered to the public through a syndicate of underwriters which was co-led by CIBC Capital Markets, Scotiabank, BMO Capital Markets and Cormark Securities, and included National Bank Financial Inc., TD Securities Inc., RBC Capital Markets, Canaccord Genuity Corp., iA Securities and PI Financial Corp. (collectively, the “Underwriters”). The Offering included 192,000 Subscription Receipts issued pursuant to the exercise, in full, of an over-allotment option granted to the Underwriters by the Company.

Once the net proceeds from the Offering are released from escrow by the subscription receipt agent, such proceeds will be used by the Company to finance, in part, the previously announced acquisition (the “Oberto’s Acquisition”) of substantially all of the assets and business undertakings of the meat snack business (the “Oberto’s Business”) of Oberto Sausage Company (the “Seller”) pursuant to a definitive agreement dated as of April 12, 2018 between, among others, the Company and the Seller (the “Oberto’s Acquisition Agreement”), as well as the Company’s expenses of the Offering and the Oberto’s Acquisition. The balance of the purchase price for the Oberto’s Acquisition will be satisfied by a draw on the Company’s credit facility.

The Seller is a Seattle, Washington-based manufacturer of beef jerky and other protein based snack foods. Closing of the Oberto’s Acquisition is expected to occur in the second quarter of 2018 and is subject to: (i) notification requirements and the expiration or early termination of the statutory waiting period under the Hart-Scott-Rodino Antitrust Improvements Act; (ii) approval by the shareholders of the Seller; (iii) the receipt of certain third party consents from contractual counterparties; and (iv) other customary closing conditions. A shareholder holding more than 90% of the voting shares of the Seller has entered into a support agreement with the Company wherein such shareholder has agreed to support and vote in favour of the Oberto’s Acquisition. There can be no assurance that the Oberto’s Acquisition will be completed or, if completed, will be on the terms that are substantially the same as those previously announced.

The Subscription Receipts were issued pursuant to a subscription receipt agreement (the “Subscription Receipt Agreement”) dated May 2, 2018 among the Company, CIBC Capital Markets, on behalf of the Underwriters, and TSX Trust Company, as subscription receipt agent. Each Subscription Receipt represents the right of the holder to receive, upon the satisfaction or waiver of the closing conditions contained in the Oberto’s Acquisition Agreement, without payment of additional consideration or any further action on the part of the holder, one common share in the capital of the Company (a “Common Share”) plus an amount per Subscription Receipt equal to the amount per Common Share of any dividends for which record dates have occurred during the period from and including the date of closing of the Offering to and including the date immediately preceding the date that the Common Shares are issued or deemed to be issued pursuant to the Subscription Receipt Agreement, less applicable withholding taxes, if any.

The Subscription Receipts will commence trading today on the Toronto Stock Exchange under the symbol “PBH.R”.

About Premium Brands

Premium Brands owns a broad range of leading specialty food manufacturing and differentiated food distribution businesses with operations in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, Nova Scotia, Nevada, Ohio, Arizona, Minnesota, Mississippi and Washington State. The Company services a diverse base of customers located across North America and its family of brands and businesses includes Grimm’s, Harvest, McSweeney’s, Bread Garden Go, Hygaard, Hempler’s, Isernio’s, Quality Fast Foods, Fletcher’s U.S., Direct Plus, Harlan Fairbanks, Creekside Bakehouse, Stuyver’s Bakestudio, Centennial Foodservice, B&C Food Distributors, SJ Fine Foods, Shahir, Wescadia, Duso’s, Maximum Seafood, Ocean Miracle Seafood, SK Food Group, OvenPride, Hub City Fisheries, Audrey’s, Deli Chef, Piller’s, Freybe, Expresco, C&C Packing, Premier Meats, Belmont Meats, Leadbetter, Skilcor, Buddy’s Kitchen, Raybern’s, Island City Baking, Shaw Bakers, Partners Crackers, Conte Foods, Larosa Foods, Gourmet Chef, Diana’s Seafood, Interprovincial Meat Sales, Meat Factory, Frandon Seafood, Country Prime Meats, McLean Meats and Penguin Meats.

Premium Brands Holdings Corporation
George Paleologou
President and CEO
(604) 656-3100

Premium Brands Holdings Corporation
Will Kalutycz
CFO
(604) 656-3100
www.premiumbrandsholdings.com