Armtec Infrastructure Inc.

Armtec Infrastructure Inc.

December 21, 2012 08:59 ET

Armtec Infrastructure Completes Refinancing Initiative

GUELPH, ONTARIO--(Marketwire - Dec. 21, 2012) - Armtec Infrastructure Inc. (TSX:ARF)(TSX:ARF.DB) today reported that its operating subsidiary, Armtec Holdings Limited ("Armtec" or the "Company") has completed a refinancing of its senior secured loan facility with a Brookfield Asset Management Company ("Existing Facility"). The new refinancing arrangement comprises a $60 million revolving asset based loan with Canadian Imperial Bank of Commerce and a $110 million term loan facility with Brookfield Capital Partners Fund III LP. The facilities were used, in part, to repay all amounts owing under the Existing Facility which were determined to have an economic impact of a February 2013 closing. In addition to the principle the repayment included the accrued interest, the prepayment fee, the exit fee and the financing fee payable. Both facilities are for a 48 month term and will be secured by a charge on Armtec's assets. At closing, Armtec drew the full amount under the term loan facility and approximately $15 million under the revolving facility. The remaining accessible balance under the revolving facility will be available for general corporate purposes. In connection with the refinancing, the warrant to purchase common shares of Armtec previously issued to Brookfield in connection with the Existing Facility was cancelled for no consideration.

Earlier in 2012, the Company entered into a process to examine available options to refinance the Existing Facility. Key considerations of the refinancing process included the goals of lowering the cost associated with financing, improved facility flexibility and a longer maturity profile. The refinancing will result in the lowest cost to the Company of the alternate proposals examined and will have a reduced cost over the current financing. Management estimates an average cash interest rate of 8.6% on the new facilities compared to the current 12.2%. In addition, the new facilities provide for greater flexibility related to advances, repayments and increases in credit provided and are for a four year term. As a result of the settlement of the Existing Facility, the Company estimates an incremental pre-tax finance expense of $24 million to be recognized during the fourth quarter of 2012, representing the remaining balance of deferred financing costs associated with the Existing Facility.

"This refinancing is a significant step forward for Armtec," said Mark Anderson, President and Chief Executive Officer. "We are grateful for the support Brookfield has shown us through challenging times and are pleased they will continue with CIBC as our lenders. With the refinancing process behind us, we are now in a better position to focus our new business unit teams on operational performance with a goal of improving the overall leverage of the company."

"We have been impressed with management's ability to achieve their Turnaround Plan," said David Nowak, Senior Vice President with Brookfield Asset Management. "We are excited to be continuing our financial partnership with Armtec and look forward to their future success."


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.


This news release contains "forward-looking" statements within the meaning of applicable securities legislation, which involve known and unknown risks, uncertainties and other factors which may cause the actual results, events, performance or achievements of Armtec or industry results, to be materially different from any future results, events, performance or achievements expressed or implied by such forward-looking statements. In this press release forward-looking statements include statements concerning the costs of the refinancing, the cash interest rate of the new facilities, greater flexibility under the new facilities related to advances, repayment and increases in credit, and incremental pre-tax finance expense and operational performance. Forward-looking statements typically contain such words or phrases as "may", "outlook", "objective", "intend", "estimate", "anticipate", "should", "could", "would", "will", "expect", "believe", "plan" and other similar terminology suggesting future outcomes or events. Forward-looking statements reflect current expectations regarding future results, events, performance and achievements and are based on information currently available to Armtec's management, anticipated operating and financial results of Armtec, and current and anticipated market conditions.

Forward-looking statements involve numerous assumptions and should not be read as guarantees of future results, events, performance or achievements. Such statements will not necessarily be accurate indications of whether or not such future results, events, performance or achievements will be achieved. You should not unduly rely on forward-looking statements as a number of factors, many of which are beyond the control of Armtec, could cause actual results, events, performance or achievements to differ materially from the results, events, performance or achievements discussed in the forward-looking statements, including, but not limited to the factors discussed in Armtec's materials filed with the Canadian securities regulatory authorities from time to time. Although the forward-looking statements contained in this news release are based upon what management of Armtec believes are reasonable assumptions, Armtec cannot assure investors that actual results, events, performance or achievements will be consistent with these forward-looking statements. All forward-looking statements in this news release are qualified by these cautionary statements. These forward-looking statements are made as of the date of this news release and, except as required by applicable law, Armtec assumes no obligation to update or revise them to reflect new events or circumstances.


Armtec is subject to certain risks and uncertainties that could have a material adverse effect on Armtec's results of operations, business prospects, financial condition, dividends to shareholders and the trading price of Armtec's shares. These uncertainties and risks include, but are not limited to: industry cyclicality; competition; acquisition and expansion risk; capital and liquidity risk; current economic conditions; reduction in demand for products; information management; credit risk; relationships with suppliers; lack of long-term agreements; expiration of rights under license and distribution arrangements; availability and price volatility of raw materials; product liability; intellectual property; reliance on key personnel; labour markets; environmental; collective bargaining; pension plans; currency fluctuations; interest rates; uninsured and underinsured losses; operating hazards; existing legal proceedings; risk of future legal proceedings; securities laws compliance and corporate governance standards; income tax and other taxes; geographical risk; seasonality and adverse weather; change management and geopolitical. Further information about these and other risks and uncertainties can be found in the disclosure documents filed by Armtec Infrastructure Inc. with the securities regulatory authorities, available at

Contact Information

  • Armtec Infrastructure Inc.
    Carrie Boutcher
    Vice President & Corporate Secretary
    (519) 822-0210
    (519) 822-8894 (FAX)