Alaris Royalty Corp. will issue on a bought-deal basis C$100 million of convertible unsecured subordinated debentures, subject to regulatory approval.
This is pursuant to an agreement that the company entered into with a syndicate of underwriters led by CIBC Capital Markets, National Bank Financial Inc., RBC Capital Markets and Scotiabank.
The debentures will be issued at C$1,000 apiece, with an interest rate of 5.50% per annum, payable semi-annually on the last business day of June and December starting Dec. 31. They will mature June 30, 2024.
The underwriters were given a 30-day overallotment option to buy up to an additional C$15 million of debentures. Total gross proceeds will be C$115 million if the overallotment option is fully exercised.
Alaris will use net proceeds to repay existing debt and for general corporate purposes.
The debentures will be convertible at the holder's option into fully paid and non-assessable Alaris common shares at a conversion price of C$24.25 per common share; the conversion rate is about 41.2371 common shares for each C$1,000 principal amount of debentures. They will be convertible at any time before the close of business on the earlier of the business day immediately preceding the maturity date and the date specified by Alaris for redemption of the debentures.