Hammond Power Solutions Announces $56,957,490 Bought Deal Secondary Offering of Class A Subordinate Voting Shares
October 9, 2024
Hammond Power Solutions Inc. (TSX: HPS.A) (the “Company” or “HPS”) and 1000925271 Ontario Inc., a wholly-owned subsidiary of Arathorn Investments Inc., (the “Selling Shareholder”) announced on September 24, 2024, that they have entered into an agreement with Acumen Capital Finance Partners Limited and Canaccord Genuity Corp. (the “Co-Lead Underwriters”), pursuant to which the Co-Lead Underwriters have agreed to purchase, on a bought deal basis, 434,790 Class A Subordinate Voting Shares (the “Offered Shares”) from the Selling Shareholder at a price of $131.00 per Offered Share for gross proceeds to the Selling Shareholder of approximately $56,957,490 (the “Offering”). HPS will not receive any proceeds from the Offering.
The Selling Shareholder has also granted the Underwriters the option to purchase up to 65,210 additional Offered Shares, at a price of $131.00 per Offered Share, to cover over-allotments, if any, and for market stabilization purposes, exercisable in whole or in part at any time until 30 days after the closing of the Offering.
The Selling Shareholder is a company controlled by William G. Hammond, Chair of the Board of HPS. Prior to the Offering, Mr. Hammond beneficially owned or controlled, directly or indirectly, an aggregate of 924,636 Class A Subordinate Voting Shares and 2,778,300 Class B Common Shares (collectively, the “Shares”) representing approximately 31.1% of the total issued and outstanding Shares (on an as converted basis) and approximately 59.5% of the voting power attached to all Shares.
Following the closing of the Offering, Mr. Hammond will beneficially own or control, directly or indirectly, 489,846 Class A Subordinate Voting Shares and 2,778,300 Class B Common Shares, representing approximately 27.5% of the issued and outstanding Shares (on an as converted basis) and approximately 57.3% of the voting power attached to all of the Shares (and approximately 26.9% and 57.0%, respectively, if the over-allotment option is exercised in full).
Closing of the Offering is expected to be on or about September 27, 2024 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals, including the applicable securities regulatory authorities.
The Offered Shares will be offered in each of the provinces of Canada, except for Quebec, by way of a prospectus supplement to the short form base shelf prospectus of the Company dated June 20, 2024 and may also be offered to qualified institutional buyers pursuant to Rule 144A or Regulation D or in such other manner as to not require registration under the U.S. Securities Act of 1933, as amended, (the “U.S. Securities Act”) in the United States.
Delivery of the shelf prospectus, the prospectus supplement, and any amendments to the documents will be satisfied in accordance with the “access equals delivery” provisions of applicable securities legislation. The shelf prospectus and the prospectus supplement will be accessible on SEDAR+ at www.sedarplus.ca on or prior to September 25, 2024.
An electronic or paper copy of the shelf prospectus, the prospectus supplement, and any amendment to the documents may be obtained, without charge, from the Company by phone at 519-822-2441 x453 or by e-mail at ir@hammondpowersolutions.com by providing the Company with an email address or address, as applicable.
This news release does not constitute an offer to sell or a solicitation of an offer to buy any securities in the United States or any other jurisdiction in which such offer, solicitation or sale would be unlawful. No securities may be offered or sold to, or for the account or benefit of persons in the United States or to any U.S. persons in which such offer or sale would be unlawful absent registration or an available exemption under the U.S. Securities Act, and compliance with or exemption from any applicable state securities laws. “United States” and “U.S. persons” shall have the meaning given to them in Regulation S under the U.S. Securities Act.
About Hammond Power Solutions Inc.
HPS enables electrification through its broad range of dry-type transformers, power quality products and related magnetics. HPS’ standard and custom-designed products are essential and ubiquitous in electrical distribution networks through an extensive range of end-user applications. The Company has manufacturing plants in Canada, the United States (U.S.), Mexico and India and sells its products around the globe. HPS shares are listed on the Toronto Stock Exchange and trade under the symbol HPS.A.
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Hammond Power Solutions Inc. (“HPS”) (TSX: HPS.A), a leading manufacturer of dry-type transformers and power quality solutions, announced on September 23, 2024, that it has entered into a definitive agreement to acquire the assets relating to the operations of Micron Industries Corporation (“Micron Industries”), a company based in the United States. Micron Industries is a leading provider of control transformers and other electrical products and had approximately $23 million USD of revenue in 2023. Its manufacturing facility and head office are based in Sterling, Illinois.
