Héroux-Devtek announces special distribution of $5.00 per share

LONGUEUIL, QC, Nov. 9, 2012 /CNW Telbec/ - Héroux-Devtek Inc. (TSX: HRX), ("Héroux-Devtek" or the "Corporation"), a leading Canadian manufacturer of aerospace products, is pleased to announce that its Board of Directors has authorized a special cash distribution of $5.00 per share to be paid on December 19, 2012 (the "Payment Date") to shareholders of record on November 20, 2012 (the "Record Date").

The special distribution follows the sale by Héroux-Devtek of substantially all of its Aerostructure and Industrial Products operations (the "Sale Transaction") at the end of August 2012. The Board of Directors determined that the special distribution represents an appropriate use of Héroux-Devtek's financial resources following the completion of the Sale Transaction, as it provides shareholders with an adequate return on their investment, while allowing the Corporation to maintain a healthy financial position. The Board of Directors decided to retain financial resources to ensure adequate funding of expected capital and other investments and potential opportunities for future growth, including strategic acquisitions. It will periodically review Héroux-Devtek's cash position and capital requirements and evaluate alternatives available to Héroux-Devtek to enhance shareholder value.

As the amount of the special distribution exceeds 25% of Héroux-Devtek's current stock price, the Toronto Stock Exchange will require that the shares trade on a "due bill" basis from the opening of trading on November 16, 2012 to the close of trading on the Payment Date. This means that sellers of shares during that period (i.e. sellers in trades settled after the Record Date and entered into on or before the Payment Date) will also sell to the purchasers their entitlement to the special distribution. The shares will commence trading on an ex-distribution basis (i.e. without an attached "due bill" entitlement to the special distribution) from the opening of trading on December 20, 2012.

In order to implement the special distribution, the Board of Directors has called a special shareholder meeting to be held on December 18, 2012 to consider the adoption of a special resolution to reduce the amount of the Corporation's issued share capital by $2.70 per share and repay such amount on the Payment Date to shareholders of record on the Record Date. The meeting will take place at 10 a.m. in the Salon Printemps of the OMNI Mont-Royal Hotel, 1050 Sherbrooke Street West, in the City of Montréal, Québec. The Board of Directors has also fixed the Record Date as the record date to determine shareholders entitled to receive notice and vote at the special shareholder meeting.

The Board of Directors has also declared a special cash dividend, to be paid on the Payment Date to shareholders of record on the Record Date, in an amount to be equal to the difference between $5.00 per share and the per share amount of the capital reduction and repayment that will be approved by the shareholders at the meeting, if any.

Therefore, if the capital reduction and repayment is approved at the special shareholder meeting, the special cash distribution of $5.00 per share ($160.0 million based on up to 32 million common shares) will be composed of a capital reduction and repayment of $2.70 per share ($86.4 million) and a special cash dividend of $2.30 per share ($73.6 million), and a shareholder will, under certain circumstances, not be subject to tax on the amount of the capital reduction and repayment or, at the very least, be able to treat the amount of the capital reduction and repayment that is in excess of the shareholder's cost base in the shares as a capital gain. If the capital reduction is not approved at the meeting, the special cash distribution will consist of a dividend of $5.00 per share.

Full details of the special distribution and proposed capital reduction and repayment, including a summary description of the principal Canadian federal income tax considerations applicable to shareholders in connection with the special distribution, will be included in the management proxy circular that will be mailed to shareholders on or about November 26, 2012.

About Héroux-Devtek Inc.
Héroux-Devtek Inc. (TSX: HRX) is a Canadian company specializing in the design, development, manufacture and repair and overhaul of landing gear systems and components for the Aerospace market. The Corporation is the third largest landing gear company in the world, supplying both the commercial and military sectors of the Aerospace market with new landing gear systems and components, as well as aftermarket products and services. Approximately 70% of the Corporation's sales are outside Canada, mainly in the United States. The Corporation's head office is located in Longueuil, Québec with facilities in the Greater Montreal area (Longueuil, Laval and St-Hubert); Kitchener and Toronto, Ontario; as well as Springfield and Cleveland, Ohio.

Forward-Looking Statements
Except for historical information provided herein, this press release may contain information and statements of a forward-looking nature concerning the future performance of the Company. These statements are based on suppositions and uncertainties as well as on management's best possible evaluation of future events. Such factors may include, without excluding other considerations, fluctuations in quarterly results, evolution in customer demand for the Company's products and services, the impact of price pressures exerted by competitors, and general market trends or economic changes. As a result, readers are advised that actual results may differ from expected results.

SOURCE: HEROUX-DEVTEK INC.