Stuart Olson greenshoe increases 6% convertibles to C$80.5 million

By Angela McDaniels

Tacoma, Wash., Sept. 29 – Stuart Olson Inc. said the underwriters for its 6% five-year convertible subordinated debentures exercised their C$10.5 million over-allotment option in full, increasing the size of the issue to C$80.5 million from C$70 million.

As previously reported, the company priced C$60 million of the convertibles at par with an initial conversion premium of 35% on Sept. 3 and increased the size of the bought-deal financing to C$70 million the next day. The 30-day greenshoe was increased to C$10.5 million from C$9 million.

The syndicate of underwriters for the Regulation S deal was co-led by TD Securities Inc. and CIBC and included RBC Capital Markets, Raymond James Ltd., Canaccord Genuity Corp., Dundee Securities Ltd., National Bank Financial Inc., Scotiabank, HSBC Securities (Canada) Inc. and Paradigm Capital Inc.

The debentures are non-callable until Dec. 31, 2017 and then are provisionally callable until Dec. 31, 2018 if shares rise to 125% of the conversion price. After Dec. 31, 2018, the debentures are freely callable. They mature Dec. 31, 2019.

Proceeds will be used to refinance at maturity a portion of the 6% convertibles due June 30, 2015 and, in the interim, to repay the balance of debt under the company’s revolving credit facility. Remaining proceeds will be maintained as cash on hand.

Based in Calgary, Alta., Stuart Olson provides building construction, commercial and industrial electrical contracting, earthmoving and industrial insulation services.

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