Strongco Corporation

Strongco Corporation

December 06, 2010 18:11 ET

Strongco Announces Rights Offering

MISSISSAUGA, ONTARIO--(Marketwire - Dec. 6, 2010) - Strongco Corporation (TSX:SQP) announced today it has filed a rights offering circular (the "Rights Offering Circular") with the Toronto Stock Exchange (the "TSX") and securities regulators in respect of a rights offering to raise net proceeds of approximately $7.6 million (the "Offering"). The Offering will be used to fund Strongco's growth strategy, which may include potential strategic acquisitions and/or acquisition or expansion of its branch facilities, to finance general working capital requirements and for other general corporate purposes.

"We believe that in addition to the expected growth in the heavy equipment market, there are opportunities for Strongco to grow through geographic expansion and acquisition," said Robert Dryburgh, President and Chief Executive Officer of Strongco. "This Rights Issue is the first step in positioning Strongco to capitalize on those incremental growth opportunities."

Under the Offering, each registered holder of common shares of the Corporation (the "Shares") as of a record date to be determined in conjunction with the TSX will receive one right (a "Right") for each Share held. Four Rights plus the sum of $3.00 (the "Subscription Price") are required to subscribe for one Share (the "Basic Subscription Privilege"). The Rights will expire on a date to be announced (the "Expiry Date"), after which unexercised Rights will be void and without value. The Rights will be listed on the TSX. Shareholders who fully exercise their Rights may subscribe pro-rata for any additional Shares not otherwise subscribed for before the Expiry Date (the "Additional Subscription Privilege"). Certain directors of the Corporation, who are also shareholders, have indicated their intention to exercise all Rights issued to them and, if available, to subscribe for additional Shares under the Additional Subscription Privilege.

The Offering is subject to regulatory approval, including that of the TSX. The TSX has conditionally approved the listing and posting for trading of the Rights and the common shares of the Corporation underlying the Rights, subject to the satisfaction of certain listing requirements. The Corporation anticipates the Offering will be completed by mid-January, 2011. More details concerning the Offering and the procedures to be followed by holders of Shares will be contained in the Rights Offering Circular to be mailed to holders of Shares.

About Strongco

Strongco Corporation is one of Canada's largest multiline mobile equipment dealers. Strongco sells, rents and services equipment used in sectors such as construction, infrastructure, mining, oil and gas, utilities, municipalities, waste management and forestry. Over 500 employees in 26 branches service customers across Canada. Strongco represents leading equipment manufacturers with globally recognized brands, including Volvo Construction Equipment, Case Construction, Manitowoc Crane, Terex Cedarapids, Skyjack, Fassi, Allied, Taylor, ESCO, Dressta and Sennebogen. Strongco is listed on the Toronto Stock Exchange under the symbol SQP.

Contact Information