Dollarama announces private offering of $125 million additional floating rate senior unsecured notes
Not for release over US newswire services or dissemination in the US
MONTRÉAL, April 2, 2015 /CNW Telbec/ - Dollarama Inc. (TSX: DOL) ("Dollarama" or the "Corporation") announced today that it has priced an offering of $125 million aggregate principal amount of floating rate senior unsecured notes due May 16, 2017 (the "Additional Notes"). The Additional Notes constitute an increase to the $150 million aggregate principal amount of floating rate senior unsecured notes due May 16, 2017 issued by the Corporation on May 16, 2014 (the "Original Notes") under a trust indenture dated November 5, 2013 between the Corporation and Computershare Trust Company of Canada, as trustee, as supplemented by a supplemental indenture dated May 16, 2014.
The Additional Notes are being offered through an agency syndicate consisting of RBC Dominion Securities Inc. and CIBC World Markets Inc., as joint bookrunners and co-lead private placement agents, and including National Bank Financial Inc. and TD Securities Inc. The offering is expected to close on or about April 8, 2015, subject to customary closing conditions.
The Additional Notes will be issued at a discount of 0.336% of the principal amount thereof, for aggregate gross proceeds of $124.58 million. In addition to the purchase price of the Additional Notes, purchasers will be required to pay an amount equal to the accrued interest on the Original Notes from and including February 16, 2015 to but excluding the date of issuance of the Additional Notes. As of the date of issuance, the effective spread over the 3‑month bankers' acceptance rate (CDOR) for the Additional Notes will be 70 basis points (or 0.70%). Once issued, the Additional Notes will bear interest at the same rate as the Original Notes, such rate being equal to the applicable 3‑month bankers' acceptance rate (CDOR) plus 54 basis points (or 0.54%), to be set quarterly on the 16th day of May, August, November and February of each year. Interest on the Additional Notes will be payable in cash quarterly, in arrears, on the 16th day of May, August, November and February of each year until their maturity, concurrently with the payment of interest on the Original Notes, commencing on May 16, 2015. All other terms and conditions applicable to the Original Notes shall also apply to the Additional Notes, and the Additional Notes will be treated as a single series with the Original Notes.
Dollarama intends to use the net proceeds of the offering to repay indebtedness outstanding under its revolving credit facility, which is expected to result in interest savings for the Corporation over the term of the Additional Notes, as borrowings under the revolving credit facility bear interest at a higher spread over the same 3‑month bankers' acceptance rate (CDOR). Any remaining net proceeds will be used for general corporate purposes.
The Additional Notes will be direct unsecured obligations of Dollarama and will rank pari passu with all other unsecured and unsubordinated indebtedness of Dollarama, including the Original Notes.
The Additional Notes have been assigned by DBRS Limited a provisional rating of BBB, with a stable trend, identical to the rating assigned to the Original Notes, and are being offered in Canada on a private placement basis in reliance upon exemptions from the prospectus requirements under applicable securities legislation.
The Additional Notes have not been and will not be qualified for sale to the public under applicable securities laws in Canada and, accordingly, any offer and sale of the Additional Notes in Canada will be made on a basis which is exempt from the prospectus requirements of such securities laws. The Additional Notes have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or the securities laws of any other jurisdiction, and may not be offered or sold in the United States absent registration under, or an applicable exemption from the registration requirements of, the U.S. Securities Act. This news release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any offer to sell or a solicitation of an offer to buy the Additional Notes in any jurisdiction where it is unlawful to do so.
About Dollarama
Dollarama is Canada's leading dollar store operator with 955 locations across the country. Our stores provide customers with compelling value in convenient locations, including metropolitan areas, mid-sized cities and small towns. Dollarama aims to provide customers with a consistent shopping experience, offering a broad assortment of everyday consumer products, general merchandise and seasonal items. Products are currently sold in individual or multiple units at select fixed price points up to $3.00.
Forward-Looking Statements
Certain statements in this news release about our current and future plans, expectations and intentions, results, levels of activity, performance, goals or achievements or any other future events or developments constitute forward-looking statements. Forward-looking statements are based on information currently available to us and on estimates and assumptions made by us in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors that we believe are appropriate and reasonable in the circumstances, but there can be no assurance that such estimates and assumptions will prove to be correct. Many factors could cause our actual results, level of activity, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements, including, without limitation, the factors discussed in greater detail in the "Risks and Uncertainties" section of the Corporation's management's discussion and analysis (MD&A) for the fiscal year ended February 1, 2015 and in the Corporation's other continuous disclosure filings (available on SEDAR at www.sedar.com). In addition, the closing of the proposed offering of Additional Notes is subject to general market and other conditions and there can be no assurance that the proposed offering of Additional Notes will be completed or that the terms of the proposed offering of Additional Notes will not be modified. These factors are not intended to represent a complete list of the factors that could affect us; however, they should be considered carefully. The purpose of the forward-looking statements is to provide the reader with a description of management's expectations regarding the Corporation's financial performance and the proposed offering of Additional Notes and may not be appropriate for other purposes; readers should not place undue reliance on forward-looking statements made herein. Furthermore, unless otherwise stated, the forward-looking statements contained in this news release are made as at April 2, 2015, and we have no intention and undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.
SOURCE Dollarama Inc.
