Neighbourly Announces Exercise of $18 Million Over-Allotment Option in Connection with Previously Announced Private Placement Français
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TORONTO, April 14, 2022 /CNW/ - Neighbourly Pharmacy Inc. (TSX: NBLY) ("Neighbourly" or the "Company"), is pleased to announce that further to its news releases dated March 10, 2022 and March 18, 2022, Persistence Capital Partners ("PCP"), the Company's largest shareholder, has exercised, in full, its option (the "Placement Over-Allotment Option") to acquire 622,500 additional subscription receipts in the capital of Neighbourly (the "Placement Subscription Receipts"), at a price of $28.95 per Placement Subscription Receipt, for additional aggregate gross proceeds to the Company of approximately $18 million.
Aggregate gross proceeds from the previously announced public offering (including the exercise, in full, of the underwriters' over-allotment option) and concurrent private placement of subscription receipts, combined with today's exercise of the Placement Over-Allotment Option by PCP, total approximately $288 million and will contribute toward funding Neighbourly's previously announced acquisition (the "Acquisition") of Rubicon Pharmacies ("Rubicon"). Closing of the Acquisition remains subject to customary conditions for transactions of such nature, including the receipt of necessary third party consents and regulatory approvals. Neighbourly continues to expect the completion of the Acquisition to occur during the second quarter of calendar year 2022.
"We are excited to have the continued support and confidence of PCP. The Company remains well-capitalized post the Acquisition of Rubicon's 100 locations. Our prudent capital structure provides us with significant incremental financing capacity and free cash flow available to continue to execute on our successful acquisition strategy. With a robust pipeline we feel strongly about our opportunities for continued growth," stated Chris Gardner, Neighbourly's Chief Executive Officer.
Following closing of the Placement Over-Allotment Option, and assuming the conversion of all the then outstanding subscription receipts, PCP and its affiliates would beneficially own or control, directly or indirectly, an aggregate of 21,985,922 common shares in the capital of Neighbourly, representing approximately 49.5% of the then issued and outstanding common shares of Neighbourly.
"Our ongoing investment in Neighbourly represents PCP's commitment to supporting the Company's acquisition and integration strategy with the Canadian pharmacy landscape continuing to offer a robust pipeline of compelling opportunities for future growth," stated Stuart M. Elman, Managing Partner of PCP.
The Placement Subscription Receipts and the underlying common shares are subject to a four month hold period under applicable securities laws from the date of issuance of the subscription receipts.
Neighbourly is Canada's largest and fastest growing network of community pharmacies. United by their patient first focus and their role as essential and trusted healthcare hubs within their communities, Neighbourly's pharmacies strive to provide accessible healthcare with a personal touch. Since 2015, Neighbourly has expanded its diversified national footprint to include 271 locations (on a pro forma basis, after giving effect to the Acquisition), reinforcing the Company's reputation as the industry's acquirer of choice.
For more information, please contact [email protected] or visit www.neighbourlypharmacy.ca.
This news release contains "forward-looking information" and "forward-looking statements" (collectively, "forward-looking information") within the meaning of applicable securities laws. Forward-looking information may relate to our future financial results and may include information regarding our financial position, business strategy, growth strategies, financial results, taxes, dividend policy, plans and objectives. In some cases, forward-looking information can be identified by the use of forward-looking terminology such as "expects", "estimates", "outlook", "forecasts", "projection", "prospects", "intends", "anticipates", "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might", "will", "will be taken", "occur" or "be achieved". In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts but instead represent management's expectations, estimates and projections regarding future events or circumstances. Forward-looking information in this news release includes, among other things, statements relating to the Acquisition and use of proceeds therefrom, the closing of the Acquisition and timing thereof, the anticipated sources of financing of the Acquisition, the fact that closing of the Acquisition is conditional on certain events occurring, and the receipt of all necessary regulatory and other approvals.
Forward-looking information is necessarily based on a number of opinions, estimates and assumptions that the Company considered appropriate and reasonable as of the date such statements are made in light of its experience and perception of historical trends, current conditions and expected future developments. Such estimates and assumptions include assumptions in respect of our ability to build our market share; our ability to retain key personnel; our ability to maintain and expand geographic scope; our ability to execute on our expansion plans; our ability to continue investing in infrastructure to support our growth; our ability to obtain and maintain existing financing on acceptable terms; currency exchange and interest rates; the impact of competition; the changes and trends in our industry or the global economy; the changes in laws, rules, regulations, and global standards, the satisfaction of all conditions of closing and the successful completion of the Acquisition within the anticipated timeframe, including receipt of regulatory and other required approvals and waivers of rights of first refusal ("ROFRs") in favour of certain third parties; the estimated purchase price of the Acquisition, including post-closing adjustments and ROFRs; the receipt of consent of third parties to the change of control triggered by the Acquisition under relevant agreements and store leases; the successful and timely integration of Rubicon in the timeframe anticipated; the realization of the anticipated benefits, economies of scale, operating efficiencies, costs savings and synergies of the Acquisition in the timeframe anticipated, including impacts on growth and accretion in various financial metrics; and the absence of significant undisclosed costs or liabilities associated with the Acquisition, are material factors made in preparing forward-looking information and management's expectations.
Further, forward-looking information is subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, including but not limited to risks and uncertainties related to the Acquisition, including the failure to complete the Acquisition in all material respects in accordance with the purchase agreement with respect to the Acquisition; the failure to obtain, in a timely manner or at all, regulatory and other required approvals and waivers of ROFRs, or to otherwise satisfy the conditions to the completion of the Acquisition; necessary borrowings under the Company's credit facilities may not be available to fund a portion of the Acquisition; risks related to increased indebtedness after completion of the Acquisition; the failure to receive consents of third parties to the change of control triggered by the Acquisition under relevant agreements and store leases; the failure to realize the anticipated benefits, economies of scale, operating efficiencies, costs savings and synergies of the Acquisition in the timeframe anticipated, or at all; the materiality of post-closing adjustments under the purchase agreement; the Rubicon business may be adversely impacted during the pendency of the Acquisition; the risk of potential unforeseen difficulties in integrating the Rubicon business into the Company's systems and operations; risks related to the dependence of the Company on key employees and the loss of certain key Rubicon personnel; significant undisclosed costs or liabilities associated with the Acquisition may be discovered; risks of reliance on information provided by Rubicon and the risk of inaccurate or incomplete information, historical and/or stand-alone financial information may not be representative of future performance, uncertainty as to expected financial condition and economic performance following the completion of the Acquisition, and heightened exposure to regulatory environment in the Canadian Prairies following the Acquisition; as well as other factors discussed or referred to in the Company's Management's Discussion and Analysis for the 16-week and 40-week periods ended January 1, 2022 and under the heading "Risk Factors" in the final long form prospectus dated May 17, 2021 filed in connection with the initial public offering of Neighbourly, both of which are available on SEDAR at www.sedar.com under the Company's profile. If any of these risks or uncertainties materialize, or if the opinions, estimates, or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking information.
Although we have attempted to identify important risk factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other risk factors not presently known to us or that we presently believe are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking information. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. No forward-looking statement is a guarantee of future results. Accordingly, you should not place undue reliance on forward-looking information, which speaks only as of the date made. The forward-looking information contained in this news release represents the Company's expectations as of the date of this news release (or as the date they are otherwise stated to be made) and are subject to change after such date. However, the Company disclaims any intention or obligation or undertaking to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required under applicable securities laws in Canada. All of the forward-looking information contained in this news release is expressly qualified by the foregoing cautionary statements.
SOURCE Neighbourly Pharmacy Inc.
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