C.A. Bancorp Inc. Announces Date for Its Annual and Special Meeting and Provides Realization Strategy Update
Posted on June 01, 2012 at 09:00 AM EDT
TORONTO, ONTARIO -- (Marketwire) -- 06/01/12 -- C.A. Bancorp Inc. ("C.A. Bancorp" or the "Company") (TSX: BKP) today announced that the Company's annual and special meeting of shareholders (the "Meeting") will be held at 9:00 a.m. (Toronto time) on June 28, 2012 at the offices at Goodmans LLP, on the 34th floor of the Bay Adelaide Centre at 333 Bay Street, Toronto, Ontario.
The Company's Notice of Meeting and Management Information Circular dated June 1, 2012 (the "Information Circular") will be mailed to shareholders on or before June 6, 2012.
Key Purpose of the Meeting
As a result of C.A. Bancorp's Realization Strategy, as described below, the Company's cash position at the end of May, 2012 was in excess of $14 million. By the end of the third quarter of 2012, the Company expects to have cash in excess of $20 million, including the cash proceeds from the second stage of the previously disclosed sale of High Fidelity HDTV Inc. ("High Fidelity"). The Company will be in a position to make a significant cash distribution to its shareholders, at a time to be determined by the Board.
In order for the Company to facilitate significant distributions cash to shareholders, shareholders must approve a special resolution authorizing the Company to reduce its stated capital. ("Reduction in Stated Capital"). The Reduction in Stated Capital resolution will be put forth to shareholders and requires the approval of 66 2/3% of the votes cast at the Meeting.
Shareholders are urged to vote FOR the Reduction in Stated Capital resolution on the BLUE form of proxy.
Realization Strategy Update
Almost two years have passed since the Board of Directors (the "Board") determined that the interests of C.A. Bancorp would be best served by seeking opportunities to monetize the Company's investments over the short- to medium-term and distributing the net cash proceeds to shareholders (the "Realization Strategy"). The Board and management thoroughly and regularly consider alternative strategies to maximize value, but presently continue to believe that the Realization Strategy is in the Company's best interests.
To date, the Realization Strategy has resulted in the following:
-- asset sales for aggregate cash proceeds of approximately $40 million plus an additional $9.5 million expected from the sale of the Company's remaining interests in High Fidelity; -- the repurchase and cancellation of approximately 14.5 million shares at an accretive average cost of $2.11 per share; -- a significant reduction in operating expenses and the elimination of all long-term debt; and -- an increase in the Company's net book value from $2.33 per share to $3.26 per share as at March 31, 2012.
In addition, the Company has been actively supporting the management team of Digital Payment Technologies Corp. ("Digital") as Digital capitalizes on the growth in the North American parking pay station market. With greater visibility into Digital's financial performance for the fiscal year 2012 and Digital's future prospects, the Company expects to record a $1.3 million unrealized gain in the fair value of its common equity interests in Digital for the three month period ended June 30, 2012. The increase in the fair value of the Company's investment in Digital will have a positive impact of $0.10 per share on the Company's net book value.
Other Business at the Meeting
In order to facilitate the completion of the Realization Strategy, in addition to approving the Reduction in Stated Capital resolution, shareholders are being asked to vote on:
-- the election of the four director nominees; -- a resolution to ratify the Company's shareholder rights plan; -- a special resolution to activate the Company's mandatory market purchase plan requiring the Company to make repurchases of its common shares in certain circumstances; -- a special resolution, approving the consolidation of the common shares of the Company at the Board's discretion to be implemented only if the special resolution to reduce stated capital receives the required shareholder approval and a significant cash distribution is made; and -- the appointment of the auditors.
Shareholders are urged to vote FOR all the resolutions on the BLUE form of proxy.
A copy of the Information Circular is available under the Company's corporate profile on SEDAR at www.sedar.com and on C.A. Bancorp's website at www.cabancorp.com. The Information Circular contains detailed information, which shareholders are encouraged to review carefully. Shareholders who have questions about the information contained in the Information Circular, who require assistance in completing the applicable form of proxy, or who wish to make arrangements to directly obtain a printed copy of the Information Circular, are encouraged to contact the Company by (i) telephone, toll-free at 1-866-388-5985 or at 416-214-5985, (ii) facsimile to 416-861-8166; (iii) mail to 401 Bay Street, Suite 1600, Toronto, Ontario M5H 2Y4; or (iv) e-mail to email@example.com.
C.A. Bancorp Inc.
C.A. Bancorp is a publicly traded Canadian merchant bank and alternative asset manager that provides investors with access to a range of private equity and other alternative asset class investment opportunities. C.A. Bancorp has historically focused on investments in small- and middle-capitalization public and private companies, with emphasis on the industrials, real estate, infrastructure and financial services sectors. The Company is currently executing its Realization Strategy.
This release includes certain forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "should", "plans" or "continue" or the negative thereof or variations thereon or similar terminology and includes, without limitation, statements regarding expected unrealized gains and the expected impact on the Company's net book value. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. These forward-looking statements are subject to a number of risks and uncertainties. Actual results could differ materially from those anticipated in these forward-looking statements. Reference should be made to the risk factors in the Company's Annual Information Form and in the Management's Discussion and Analysis for the year ended December 31, 2011 and in the Directors' Circular dated June 4, 2010 and in our other filings with Canadian securities regulators available at www.sedar.com.
Cautionary Statement Regarding the Valuation of Investments in Private Entities
In the absence of an active market for its investments in private entities, fair values are determined by management using the appropriate valuation methodologies after considering the history and nature of the business, operating results and financial conditions, the outlook and prospects, the general economic, industry and market conditions, capital market and transaction market conditions, contractual rights relating to the investment, public market comparables, private market transactions multiples and, where applicable, other pertinent considerations. The process of valuing investments for which no active market exists is inevitably based on inherent uncertainties and the resulting values may differ from values that would have been used had an active market existed. The amounts at which the Company's investments in private entities could be disposed of may differ from the fair value assigned and the differences could be material. Estimated costs of disposition are not included in the fair value determination.
C.A. Bancorp Inc. 401 Bay Street, Suite 1600 Toronto, Ontario M5H 2Y4 Telephone: (416) 214-5985 Fax: (416) 861-8166
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