12:24:41 EDT Tue 07 Jul 2020
Enter Symbol
or Name

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Chemtrade Logistics Income Fund
Symbol CHE
Shares Issued 92,596,006
Close 2019-09-10 C$ 11.32
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Chemtrade Logistics arranges $100-million bought deal

2019-09-10 15:15 ET - News Release

Mr. Mark Davis reports


Chemtrade Logistics Income Fund has arranged a public offering, on a "bought deal" basis, of $100-million principal amount of convertible unsecured subordinated debentures at a price of $1,000 per debenture with an interest rate of 6.50 per cent per year, payable semi-annually on the last day of October and April, commencing on April 30, 2020. The debentures will mature on Oct. 31, 2026.

The offering is being made through a syndicate of underwriters led by BMO Capital Markets.

The fund has also granted the underwriters the option to purchase up to $15-million principal amount of additional debentures at a price of $1,000 per debenture to cover overallotments, exercisable, in whole or in part, any time up to 30 days following closing of the offering.

The debentures will be convertible into fully paid and non-assessable freely tradeable units of the fund at the option of the holder at a conversion price of $15.80 per unit. The debentures will not be redeemable before Oct. 31, 2022. On or after Oct. 31, 2022, and prior to Oct. 31, 2024, the debentures may be redeemed, in whole or in part, from time to time at the option of the fund at par plus accrued and unpaid interest, provided that the weighted average trading price of the units on the Toronto Stock Exchange for the 20 consecutive trading days ending five trading days preceding the date on which notice of redemption is given is not less than 125 per cent of the conversion price. On or after Oct. 31, 2024, the debentures may be redeemed at the option of the fund at any time at par plus accrued and unpaid interest.

The net proceeds of the offering will be used to pay down senior debt under the fund's existing credit agreement with the intention of drawing on it to redeem all of the outstanding Chemtrade Electrochem 6.50 per cent convertible unsecured series VI debentures due Dec. 31, 2021, and for general trust purposes.

The offering is subject to normal regulatory approvals, including approval of the TSX, and is expected to close on or about Oct. 1, 2019.

The debentures will be offered by way of a short form prospectus in all of the provinces and territories of Canada and may also be offered to qualified institutional buyers, pursuant to Rule 144A, in the United States.

About Chemtrade Logistics Income Fund

Chemtrade operates a diversified business providing industrial chemicals and services to customers in North America and around the world. Chemtrade is one of North America's largest suppliers of sulphuric acid, spent acid processing services, inorganic coagulants for water treatment, sodium chlorate, sodium nitrite, sodium hydrosulphite and phosphorus pentasulphide.

We seek Safe Harbor.

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