Primary Energy Recycling Corporation announces completion of rights offering

    
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OAK BROOK, IL, Nov. 12 /CNW/ - Primary Energy Recycling Corporation (TSX: PRI) (the "Company") is pleased to announce that it has completed its previously announced US$50 million rights offering.

A total of approximately 96 million subscription receipts will be issued in connection with the rights offering. Approximately 143 million subscription receipts were subscribed for by rightholders, representing an approximate 48% oversubscription. Approximately 87 million subscription receipts, representing more than 90% of the available subscription receipts, were subscribed for pursuant to the basic subscription right and the remaining available subscription receipts were subscribed for by rightholders pursuant to the additional subscription privilege. Due to the exercise of the additional subscription privilege by rightholders, it will not be necessary for the standby purchasers to purchase subscription receipts pursuant to the terms of the standby purchase agreement. Investors should consult with their brokers or other intermediaries through which they exercised rights to determine their allotment of subscription receipts under the additional subscription privilege.

Each subscription receipt will be automatically exchanged for one common share of the Company on the date of the refinancing of the Company's US$131 million term loan. As previously announced, the Company has obtained commitments to borrow up to US$105 million, subject to satisfaction of customary conditions, including closing of the Company's rights offering. The proceeds of the rights offering, together with a portion of the US$105 million of loans will be used to refinance the Company's term loan in full. The Company expects such refinancing to close within the next several days. As a result, the Company does not intend to list the subscription receipts on the Toronto Stock Exchange. The common shares issuable on conversion of the subscription receipts will be listed on the Toronto Stock Exchange as soon as practicable following the closing of the refinancing. On conversion of the subscription receipts, a total of 134,118,561 common shares of the Company will be issued and outstanding.

"With the hugely successful rights offering completed and the US$105M loan scheduled to close within the next several days, we are rapidly completing our restructuring efforts. The confidence investors have shown in the Company by oversubscribing by almost 50% continues to prove we are on the right path to unlocking shareholder value", said John Prunkl, President and Chief Executive Officer of the Company. "In addition, Capital Power Income LP (formerly EPCOR Power LP) has formally notified the Company that it intends to exercise it pre-emptive right to subscribe for approximately 16 million common membership interests of Primary Energy Recycling Holdings LLP ("Primary Energy") for proceeds of US$8,346,351, which combined with the rights offering proceeds results in a total equity subscription of US$58,346,356 upon closing".

Forward-Looking Statements

When used in this news release, the words "anticipate", "expect", "project", "believe", "estimate", "forecast" and similar expressions are intended to identify forward-looking statements. Such statements are subject to certain risks, uncertainties and assumptions pertaining, but not limited to, the refinancing of the term loan and the other risk factors discussed in the Company's public filings available on SEDAR at www.sedar.com. These forward-looking statements are made as of the date of this press release and, except as required by applicable securities laws, the Company assumes no obligation to update or revise them to reflect new events or circumstances.

About Primary Energy Recycling Corporation

The Company owns a majority interest in Primary Energy. Primary Energy, headquartered in Oak Brook, Illinois, indirectly owns and operates four recycled energy projects and a 50 per cent interest in a pulverized coal facility (collectively, the "Projects"). The Projects have a combined electrical generating capacity of 283 megawatts and a combined steam generating capacity of 1.8 MMlbs/hour. Primary Energy creates value for its customers by capturing and recycling waste energy from industrial and electric generation processes and converting it into reliable and economical electricity and thermal energy for its customers' use. For more information, please see www.primaryenergyrecycling.com.

For further information: V. Michael Alverson, Chief Financial Officer, Primary Energy Recycling Corporation, [phone], [email protected]