C.A. Bancorp Inc.

C.A. Bancorp Inc.

AgriFinancial Canada Corp.

AgriFinancial Canada Corp.


October 03, 2007 13:00 ET

C.A. Bancorp Inc. (TSX:BKP) to Acquire the Businesses of Agrifinance and AgriCard Through an Estimated $89 Million Asset Purchase

TORONTO, ONTARIO--(Marketwire - Oct. 3, 2007) - C.A. Bancorp Inc. ("C.A. Bancorp") (TSX:BKP) is pleased to announce that, through a newly created subsidiary, AgriFinancial Canada Corp. ("AgriFinancial"), it plans to complete an estimated $89 million acquisition of the businesses of Agrifinance and AgriCard. The transaction is expected to be effected through a purchase of assets from Canadian Cooperative Agricultural Financial Services ("CCAFS"). The proposed transaction remains subject to approvals and consents (including regulatory approval) and completion of the definitive agreements.

Agrifinance and AgriCard, both headquartered in Winnipeg, are leading independent providers of financing solutions for the Canadian agricultural sector. Agrifinance provides specialized equipment leasing and lending products created specifically for farmers, and AgriCard is a credit card designed specifically for farm-related purchases. For more information on Agrifinance and AgriCard visit www.agrifinance.ca and www.agricard.ca.

"C.A. Bancorp is excited by the prospect of acquiring the well-managed businesses of Agrifinance and AgriCard as a platform investment in the financial services sector. We plan to grow both Agrifinance and AgriCard significantly, as well as to develop new financial products tailored to the Canadian agricultural marketplace," said Mark Gardhouse, President of C.A. Bancorp. "There is tremendous opportunity for AgriFinancial, our newly formed financial services platform to capitalize on the growing financing needs of Agrifinance and AgriCard customers now and in the future."

"AgriCard and Agrifinance have a long history of providing innovative financial services to the Canadian agricultural market," said Brian Leier, current Chief Executive Officer of CCAFS and future President and Chief Executive Officer of AgriFinancial. "Under the newly created AgriFinancial Canada Corp., we plan to continue to offer farmers, dealers and partners value-added, creative financing solutions that will contribute to their success. As a Canadian-owned company, AgriFinancial is excited about the future of agriculture in our country and is firmly committed to supporting agricultural producers, coast to coast."

The estimated $89 million purchase will be financed through the assumption by AgriFinancial of approximately $78 million of debt, including the assumption of certain liabilities, and the investment of $11 million of equity. The $11 million equity investment required to complete the proposed acquisition will be made by C.A. Bancorp and Sentry Select Total Strategy Fund (TSX:TSF.UN) ("Total Strategy") through C.A. Bancorp Financial Corp. ("Financial Corp.").

C.A. Bancorp and Total Strategy are the sole shareholders of Financial Corp., with C.A. Bancorp holding approximately 90% and Total Strategy holding approximately 10% of the issued and outstanding shares of Financial Corp. Financial Corp. owns and controls all of the issued and outstanding shares of AgriFinancial. AgriFinancial has arranged senior debt financing through a syndicate of Canadian financial entities.

Subject to approvals and consents (including regulatory approval) and the completion of the definitive agreements related to the acquisition, C.A. Bancorp expects the proposed acquisition will close within a few weeks, at which time it plans to issue an additional news release providing further details of the transaction.

Trading information

C.A. Bancorp Inc. common shares trade on the Toronto Stock Exchange under the symbol BKP.

C.A. Bancorp Inc.

C.A. Bancorp Inc. is a publicly traded Canadian merchant bank and asset manager that provides investors with access to a range of private equity and alternative asset class investment opportunities. C.A. Bancorp is focused on investments in small- and middle-capitalization public and private companies, with emphasis on the industrials, real estate, infrastructure and financial services sectors.

Sentry Select Total Strategy Fund

Sentry Select Total Strategy Fund is a publicly traded closed-end fund which provides investors with an opportunity to benefit from Sentry Select Capital Corp.'s extensive management expertise across public investments and C.A. Bancorp's experience with private equity investments.

This news release contains forward-looking statements with respect to the proposed acquisition of the business of Agrifinance and AgriCard, and matters concerning the business, operations, and strategy of C.A. Bancorp and AgriFinancial. These statements relate to anticipated future events, results, circumstances, performance or expectations that are not historical facts but instead represent C.A. Bancorp's beliefs regarding future events. Often, but not always, forward-looking statements can be identified by the use of forward-looking words such as "will", "expect", "intend", "plan", "estimate", "anticipate", "believe" or "continue", similar words or the negative thereof, or variations of such words and phrases that certain actions, events or anticipated outcomes "may", "would" or "might" be taken, occur or be achieved. There can be no assurance that the plans, intentions or expectations upon which these forward-looking statements are based will occur.

The completion of the acquisition and the future business, operations and performance of C.A. Bancorp and AgriFinancial discussed herein could differ materially from those expressed or implied by such statements. Such forward-looking statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations, including that the acquisition is completed. Forward-looking statements are based on a number of assumptions which may prove to be incorrect, including, but not limited to: the ability of the C.A. Bancorp to finalize the agreements with CCAFS respecting the acquisition and/or to obtain requisite regulatory approval. Additional, important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, conditions affecting the agricultural and financial services sectors, competition, changes in government regulation, interest rates, the availability of equity and debt financing, tax related matters, and reliance on key personnel of AgriFinancial. C.A. Bancorp cautions that risk factors discussed in applicable continuous disclosure filings required by law that C.A. Bancorp has made and filed on SEDAR should also be considered carefully and that undue reliance not be placed on forward-looking statements as events and results could differ materially from those expressed or implied by forward-looking statements made by C.A. Bancorp. The cautionary statements qualify all forward-looking statements attributable to C.A. Bancorp and persons acting on its behalf.

Unless otherwise stated, all forward looking statements speak only as of the date of this press release. C.A. Bancorp does not undertake, and specifically disclaims, any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.

The Exchange Tower
130 King Street West
Suite 2810, P.O. Box 104
Toronto, Ontario M5X 1A4
Telephone: (416) 214-5985
Fax: (416) 861-8166

Contact Information

  • C.A. Bancorp Inc.
    Kurt Brands
    Vice-President, Corporate Development
    (416) 861-8166 (FAX)
    Email: kbrands@cabancorp.com