Armtec Infrastructure Inc.
TSX : ARF
TSE : ARF.DB

Armtec Infrastructure Inc.

March 24, 2011 15:46 ET

Armtec Announces Bought Deal Financing

GUELPH, ONTARIO--(Marketwire - March 24, 2011) -

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.

Armtec Infrastructure Inc. (the "Company") (TSX:ARF)(TSX:ARF.DB) today announced that it has entered into an agreement with a syndicate of underwriters co-led by Scotia Capital Inc., TD Securities Inc., and BMO Capital Markets, under which the underwriters have agreed to buy 3,100,000 common shares ("Common Shares") from the Company for sale to the public at a price of $16.20 per Common Share, representing an aggregate issue of $50,220,000 (the "Offering"). The Company has also granted to the underwriters an over-allotment option, exercisable for a period of 30 days from the date of closing of the Offering, to purchase up to an additional 465,000 Common Shares at the offering price. The Offering is expected to close on or about April 13, 2011 and is subject to regulatory and stock exchange approvals. The equity is being offered in conjunction with the planned replacement of the Company's existing revolving credit facility with a new term credit facility and a new revolving credit facility, as described below.

The net proceeds of the Offering will be used by the Company to permanently reduce indebtedness and for general corporate purposes.

"The Offering and the new credit facilities will enable Armtec to reduce total leverage and move towards its target debt level of approximately two times Total Debt to Adjusted EBITDA," said Charles Phillips, President and Chief Executive Officer. "Further, we continue to believe that stronger operating conditions in 2011 along with the increased financial flexibility provided by the repayment of debt will enable us to comfortably maintain our current level of dividends."

Armtec and the lenders under its current credit agreement have agreed, subject to final documentation, to, among other things: (a) replace the existing $250 million revolving credit facility with a new term credit facility in the amount of $75 million to mature on September 22, 2015 and a new revolving credit facility in the amount of $175 million to mature on September 22, 2015; (b) amend the calculation of Interest Expense to give effect on a pro forma basis to changes in Armtec's capital structure; and (c) amend Armtec's required Total Funded Debt to EBITDA and Interest Coverage Ratio covenants for the twelve month period ending March 31, 2011.

The securities to be 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 news 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 State in which such offer, solicitation or sale would be unlawful.

About Armtec

Armtec is a leading manufacturer and marketer of a comprehensive range of infrastructure products and engineered construction solutions for customers in a diverse cross-section of industries that are located in every region of Canada, as well as in selected markets globally. These markets include Canada's national and regional public infrastructure markets and private sector markets in agricultural drainage, commercial building, residential construction and natural resources. Operating through its network of regional offices and production facilities across the country, Armtec's broad range of engineered solutions include products for drainage, bridge applications, soil retention, rehabilitation and water management systems including corrugated high-density polyethylene, corrugated steel and concrete pipe; an array of architectural and structural precast and pre-stressed concrete products from steps, paving stones, slabs and wall panels to highly engineered structural components designed and installed for projects such as bridges, sports venues and parking garages; and a full suite of noise barriers, acoustic enclosure and wall systems along with associated retaining wall and traffic barrier systems.

Forward-Looking Statements

This news release may contain certain statements that constitute forward-looking information within the meaning of applicable securities laws ("forward-looking statements"). All statements other than statements of historical fact contained herein are forward-looking statements. Prospective investors can identify many of these statements by looking for words such as "believe", "expects", "will", "intends", "plans", "projects", "anticipates", "estimates", "continues" and similar words or the negative thereof. Forward-looking statements may include comments with respect to the expected completion and closing date of the offering, expected amendments to Armtec's credit facilities and operating conditions in 2011. There can be no assurance that the plans, intentions or expectations upon which these forward-looking statements are based will occur. Forward-looking statements reflect current expectations regarding future events and are based on information currently available to the management of Armtec. Although management believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct.

By their nature, forward-looking statements require assumptions and are subject to inherent risks and uncertainties, including those discussed herein. There is significant risk that forward-looking statements will not prove to be accurate. You are cautioned not to place undue reliance on forward-looking statements made herein because a number of factors could cause actual future results, conditions, actions or events to differ materially from the expectations, estimates or intentions expressed in the forward-looking statements.

You are cautioned that the risks and uncertainties identified above are not exhaustive and that, when relying on forward-looking statements to make decisions with respect to Armtec, investors and others should carefully consider these factors, as well as other uncertainties and potential events, and the inherent uncertainty of forward-looking statements.

The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. Armtec undertakes no obligation to publicly update or revise any forward-looking statements except as expressly required by applicable securities law.

Contact Information

  • Armtec Infrastructure Inc.
    Charles M. Phillips
    President & Chief Executive Officer
    (519) 822-0210
    (519) 822-8894 (FAX)
    or
    Armtec Infrastructure Inc.
    James R. Newell
    Chief Financial Officer
    (519) 822-0210
    (519) 822-8894 (FAX)
    or
    Armtec Infrastructure Inc.
    Carrie Boutcher
    Vice President, Finance
    (519) 822-0210
    (519) 822-8894 (FAX)