AutoCanada announces closing of equity financing

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AutoCanada says its latest offering of common shares netted the company roughly $75 million it will use to reduce debt under its revolving credit facility.

The publicly-traded dealership group had previously announced the release of 2,950,000 common shares at a price of $25.50 per share.

The offering was underwritten by a syndicate of underwriters led by RBC Capital Markets and Scotiabank and included CIBC World Markets, Clarus Securities, Canaccord Genuity, Cormark Securities, HSBC Securities (Canada), AltaCorp Capital, GMP Securities and National Bank Financial.

“The company will use the net proceeds of the offering to reduce indebtedness under its revolving credit facility, which may subsequently be redrawn and applied as needed to fund future capital expenditures, including the potential acquisition of additional dealerships, and for general corporate and working capital purposes,” AutoCanada explained in a release.

It had first revealed its plan in a statement disseminated on Nov. 24. At the time, it said common shares would be offered under a short form prospectus to be filed in each province.

As one of Canada’s largest dealership groups, AutoCanada currently operates 54 franchised dealerships, comprised of 62 franchises in eight provinces and has over 3,750 employees.

In 2014, it sold approximately 57,000 vehicles and processed approximately 786,000 service and collision repair orders in 822 service bays.