C.A. Bancorp Inc.

C.A. Bancorp Inc.

July 28, 2011 16:38 ET

C.A. Bancorp Advised of Potential Partial Take-over Bid

TORONTO, ONTARIO--(Marketwire - July 28, 2011) - C.A. Bancorp Inc. ("C.A. Bancorp" or the "Company") (TSX:BKP) announced today that it has been informed that CDJ Global Catalyst LLC ("CDJ"), the largest shareholder of the Company, intends to make a partial take-over bid for the Company's shares. The Company was advised by CDJ's counsel that the proposed take-over bid is expected to be made shortly for a number of Company shares that would, if successful, result in CDJ owning approximately 4 million C.A. Bancorp shares, increasing CDJ's ownership of Company shares from its present reported level of approximately 19.8% to approximately 32.6%. No price per share was identified in the CDJ communication.

A partial take-over bid of the nature being proposed by CDJ would be inherently coercive to the other shareholders and would not be in the best interests of C.A. Bancorp or its shareholders. Such a take-over bid would, if successful, result in the acquisition of effective control of the Company through the purchase of only a relatively small percentage of its shares. Additionally, such a take-over bid would not comply with the terms of the shareholder rights plan (the "Rights Plan") which was adopted by the Company to preserve its ability to obtain the best value for all shareholders and to prevent coercive and otherwise unfair take-over tactics which could be prejudicial to shareholder interests.

If the actual terms of any proposed take-over bid were such that the Company's board of directors (the "Board") determined it was not in the interests of the Company or its shareholders, the Board intends to take steps to ensure that it can continue to develop and implement opportunities to deliver superior value to all C.A. Bancorp shareholders including convening a meeting of the Company's shareholders to provide shareholders with an opportunity to express support for the Rights Plan.

The Company and the Board, have been, and continue to be, focused on maximizing the value of C.A. Bancorp for the benefit of all of its shareholders. Over the past year the value-maximization activities have been concentrated around the Company's publicly-disclosed Realization Strategy, in furtherance of which C.A. Bancorp has:

  • completed the sale of certain assets for aggregate cash proceeds of $33.0 million,
  • repurchased for cancellation approximately 14.5 million shares at an accretive average purchase price of $2.08 for an aggregate purchase price of $30.1 million,
  • significantly reduced operating expenses, and eliminated all long-term debt, and
  • increased the net book value of the Company to $2.78 per share as at March 31, 2011.

Since December 2, 2009, the date on which the Company's value maximization initiative was commenced in response to an unsolicited take-over bid, the trading price of C.A. Bancorp's shares has increased from $1.11 to a 15 day trailing volume weighted average trading price (as at July 27, 2011) of $2.26, an increase of 104%. CDJ has publicly disclosed its opposition to the Company's Realization Strategy and recently voted against the Company's plan to return cash to shareholders as part of that strategy, and the Board believes there is a high likelihood that the Realization Strategy would be seriously jeopardized if CDJ were to acquire effective control of the Company.

The Company is continuing to work diligently on the sale of its assets, and is in advanced discussions to sell certain private investments for aggregate proceeds in excess of values reported in the Company's March 31, 2011 financial statements. If these asset sales are completed as currently contemplated, the result would be an increase in the cash available for distribution and the net book value of the Company. The Company anticipates making disclosures in the near term concerning further successful realizations of assets.

The value-maximization initiatives being considered by the Company also include the development of potential transactions that could involve the acquisition of all of the Company's shares and other means of distributing cash to shareholders all with a view to maximizing value for the Company's shareholders for all of their shares.

C.A. Bancorp Inc.

C.A. Bancorp is a publicly traded Canadian merchant bank and alternative asset manager that provides investors with access to a range of private equity and other alternative asset class investment opportunities. C.A. Bancorp has historically focused on investments in small-and middle-capitalization public and private companies, with emphasis on the industrials, real estate, infrastructure and financial services sectors. The Company is currently executing its realization strategy as described in its publicly filed continuous disclosure documents.

This release includes certain forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "should", "plans" or "continue" or the negative thereof or variations thereon or similar terminology. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will provide to be correct. These forward-looking statements are subject to a number of risks and uncertainties including, without limitation, the nature and timing of a take-over bid by CDJ, if any is not within control or direct knowledge of the Company and the proceeds realized on the sale of private investments, the ability to conclude any such sales and the timing thereof are subject to deal risks. Actual results could differ materially from those anticipated in these forward-looking statements. Reference should be made to the risk factors published in the Company's most recent management discussion and analysis and, with respect to the realization strategy, its directors circular, both of which are available at www.sedar.com.

C.A. Bancorp Inc.
401 Bay Street, Suite 1600
Toronto, Ontario
M5H 2Y4
Telephone: (416) 214-5985
Fax: (416) 861-8166

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