CPE News (6/10/2021) – Stack Capital Group Inc. has filed the final prospectus in connection with its proposed initial public offering of units.
Stack Capital Group will issue 8,335,000 units at a price of $12.00 per unit for gross proceeds of $100,020,000.
The offering is being conducted on a best efforts basis.
Con-current with the closing, certain directors and officers of the manager have agreed to purchase an aggregate of 583,334 units at the offering price for gross proceeds of $7,000,008 by way of a non-brokered private placement.
Closing of the offering is conditional on the closing of the management investment.
The TSX has conditionally approved the listing of Stack Capital Group’s common shares and warrants on the TSX under the symbols “STCK” and “STCK.WT”, respectively, via the TSX Sandbox.
Stack Capital Group’s common shares and warrants are expected to commence trading on TSX on June 16, 2021.
Stack Capital Group is a newly formed investment holding company. Its business objective is to maximize its long-term capital appreciation by seeking to achieve superior risk-adjusted investment performance. The company intends to invest in equity, debt and/or other securities of growth to late stage private operating businesses. The company will not be investing in private operating businesses smaller than $100 million in enterprise value.
SC Partners Ltd. will act as Stack Capital’s exclusive manager to source and advise with respect to all investments for Stack Capital. SC Partners will also manage such investments and otherwise direct Stack Capital’s affairs and manage Stack Capital’s business.
Stack Capital Group will pay 1.5% management and 15% performance fee to the manager. “The Company believes these fees are competitive in comparison to other private equity opportunities in the marketplace, which generally charge a management fee of 2.0% or more and a performance fee of 20% or more.”
photo credit: Stack Capital Group
News Release
Stack Capital Group Inc. Files Final Prospectus for Initial Public Offering of Units
/THIS NEWS RELEASE IS NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES./
TORONTO, June 10, 2021 /CNW/ – Stack Capital Group Inc. (“Stack Capital”) is pleased to announce that it has filed a (final) prospectus (the “Final Prospectus”) with the securities regulatory authorities in each of the provinces and territories of Canada in connection with Stack Capital’s proposed public offering (the “Offering”) of 8,335,000 units of Stack Capital (“Units”) at a price of $12.00 per Unit (the “Offering Price”). Each Unit consists of one common share (a “Common Share”) in the capital of Stack Capital and one-half of a Common Share purchase warrant (an “IPO Warrant”). Each IPO Warrant will entitle the holder to acquire, subject to adjustment in certain circumstances, one Common Share at an exercise price per share of $15.00, at any time prior to 4:00 p.m. (Toronto, Ontario time) on the date that is three years following the closing of the Offering (the “Closing”). The Units will immediately separate into Common Shares and IPO Warrants upon issuance.
The Offering is being conducted on a best efforts basis by a syndicate of agents (the “Agents”) bookrun by TD Securities Inc., RBC Capital Markets, and Scotiabank pursuant to the terms and conditions of an agency agreement between Stack Capital, SC Partners Ltd., the manager of Stack Capital (the “Manager”), and the Agents. Stack Capital has granted the Agents an over-allotment option, exercisable in whole or in part at any time for a period of 30 days after the Closing, to purchase up to an additional 15% of the aggregate number of Units (or Common Shares and/or IPO Warrants comprising such Units) issued at Closing pursuant to the Offering to cover over-allotments, if any, and for market stabilization purposes.
Concurrent with the Closing, certain directors and officers of the Manager (the “Management Investors”) have agreed to purchase an aggregate of 583,334 Units, for total gross proceeds of $7 million, on a non-brokered, private placement basis at the Offering Price (the “Management Investment”). Closing of the Offering is conditional on the closing of the Management Investment. As part of the terms of the Management Investment, each Management Investor will agree to a five-year voluntary lock-up and will retain all of the Units acquired in the Offering and the Management Investment during such period, subject to certain customary exceptions.
Closing of the Offering and commencement of trading of the Common Shares and the IPO Warrants on the Toronto Stock Exchange (“TSX”) is expected to occur on or about June 16, 2021, subject to customary closing conditions and the fulfillment of the listing conditions of the TSX, as well as the closing of the Management Investment.
Stack Capital has received conditional approval for the listing of the Common Shares and the IPO Warrants (including the Common Shares issuable upon the exercise of the IPO Warrants) on the TSX under the symbols “STCK” and “STCK.WT”, respectively. As Stack Capital does not meet the original listing requirements of the TSX set out in Section 309(a) of the TSX Company Manual, the TSX has exercised its discretion to waive the requirements for historical earnings and pre-tax cash flow, and has agreed to list Stack Capital pursuant to the TSX Sandbox. Listing on the TSX is subject to Stack Capital fulfilling all of the listing requirements of the TSX (save for those requirements for which an exemption or waiver is provided through the TSX Sandbox) including, among other things, raising minimum gross proceeds of $100 million under the Offering. Stack Capital will remain listed pursuant to the TSX Sandbox until such time as it has: (i) deployed 50% of the net proceeds raised pursuant to the Offering and the Management Investment; and (ii) publicly filed interim financial statements reflecting a full quarter of operating history subsequent to listing on the TSX. As disclosed under “Risk Factors” in the Final Prospectus, Stack Capital lacks an operating history and there is a very limited basis upon which a potential investor can evaluate Stack Capital’s ability to achieve its stated investment objective. Investors are referred to the risk factors set out in the Final Prospectus for further details.
Important Notice
The Final Prospectus contains important information relating to the Units and the Offering and has been filed with securities commissions or similar authorities in each of the provinces and territories of Canada. This press release does not constitute an offer to sell or the solicitation of an offer to buy the securities. Copies of the Final Prospectus may be obtained from one of the Agents or under Stack Capital’s profile on SEDAR at www.sedar.com. Investors should read the Final Prospectus before making an investment decision.
None of the Units, the Common Shares and the IPO Warrants have been or will be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or the securities laws of any state of the United States. Accordingly, the Units may not be offered, sold or delivered, directly or indirectly, in the United States or to United States persons unless registered under the U.S. Securities Act and applicable state securities laws, except pursuant to an exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws. This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities of Stack Capital in any jurisdiction in which such offer, solicitation or sale would be unlawful.
About Stack Capital
Stack Capital is a newly formed investment holding company. Its business objective is to maximize its long-term capital appreciation by seeking to achieve superior risk-adjusted investment performance. Stack Capital intends to invest in equity, debt and/or other securities of growth to late stage private businesses (“Portfolio Companies”) in furtherance of Stack Capital’s business objective, with such investment tailored to the specific needs and opportunities of the Portfolio Company. Depending on the circumstances of any particular investment opportunity and subject to compliance with applicable law, Stack Capital’s investment in a Portfolio Company may range from a minority ownership position to a significant influence position, including control.
The Manager has taken the initiative in creating Stack Capital. The Manager will act as Stack Capital’s exclusive manager to source and advise with respect to all investments for Stack Capital. The Manager will also manage such investments and otherwise direct Stack Capital’s affairs and manage Stack Capital’s business.
SOURCE Stack Capital Group Inc.
For further information: Brian Viveiros, VP Corporate Development and IR, 647-280-3307, Info@stackcapitalgroup.com, www.stackcapitalgroup.com