Canexus Income Fund
TSX : CUS.UN

Canexus Income Fund

August 31, 2009 09:39 ET

Canexus Income Fund Announces Closing of $86,000,000 Convertible Unsecured Subordinated Debenture Financing

CALGARY, ALBERTA--(Marketwire - Aug. 31, 2009) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF U.S. SECURITIES LAW.

Canexus Income Fund ("Canexus" or the "Fund") (TSX:CUS.UN) is pleased to announce today that it has closed its previously announced convertible debenture bought deal financing (the "Bought Deal Offering"). At closing, Canexus issued $46,000,000 aggregate principal amount of 8.00% Series I Convertible Unsecured Subordinated Debentures (the "Series I Debentures") at a price of $1,000 per Debenture. The Series I Debentures are convertible into trust units of the Fund ("Trust Units") and are listed and posted for trading on the TSX under the symbol "CUS.DB".

The Bought Deal Offering was underwritten by a syndicate led by Scotia Capital Inc., and including CIBC World Markets Inc., National Bank Financial Inc., TD Securities Inc., GMP Securities L.P. and RBC Capital Markets.

Canexus is also pleased to announce that it has closed its previously announced convertible debenture private placement financing (the "Private Placement") with Nexen Inc. ("Nexen"). At closing, Canexus issued $40,000,000 aggregate principal amount of 8.00% Series II Convertible Unsecured Subordinated Debentures (the "Series II Debentures") to Nexen. The Series II Debentures are on the same terms as the Series I Debentures, with certain exceptions, including that the Series II Debentures are convertible into Exchangeable Limited Partnership Units ("Exchangeable LP Units") of Canexus Limited Partnership ("Canexus LP"), instead of Trust Units, consistent with their current ownership structure. On a pro forma, fully diluted basis, the purchase of the Series II Debentures results in Nexen owning approximately 62.7% of the Trust Units.

The net proceeds from the Bought Deal Offering and Private Placement (the "Financing") will be used to fund Canexus' portfolio of growth opportunities, to repay existing indebtedness and for general corporate purposes.

The Series I Debentures offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

About Canexus

Canexus produces sodium chlorate and chlor-alkali products largely for the pulp and paper and water treatment industries. Our four plants in Canada and one in South America are reliable, low-cost, strategically-located facilities that capitalize on competitive electricity costs and transportation infrastructure to minimize production and delivery costs. Canexus also provides fee-for-service hydrocarbon transloading services to the oil and gas industry from its terminal at Bruderheim, Alberta. Canexus targets opportunities to maximize unitholder returns and delivers high-quality products to its customers. Canexus is listed on the Toronto Stock Exchange under the symbol CUS.UN. More information about Canexus is available at www.canexus.ca.

Forward Looking Statements

The forward looking statements contained in this press release are made as of the date hereof and Canexus undertakes no obligations to update publicly or revise any forward looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Contact Information

  • Canexus Limited
    Gary Kubera
    President and CEO
    (403) 571-7300
    or
    Canexus Limited
    Richard McLellan
    CFO
    (403) 571-7300
    Website: www.canexus.ca