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Caribbean Utilities Company, Ltd. Announces Closing of Rights Offering

Caribbean Utilities Company, Ltd. (TSX: CUP.U) (“CUC” or “the Company”) is pleased to announce the successful completion of its previously announced rights offering (the “Offering”), which expired at 4:00 p.m. (Toronto time) on October 26, 2020. Following completion of the Offering, the Company has 36,952,986 Class A Ordinary shares (the “Class A Ordinary Shares”) of the Company issued and outstanding.

Upon closing of the Offering, the Company issued 3,359,362 Class A Ordinary Shares at a price of US$14.24 per Class A Ordinary Share for aggregate gross proceeds of US$47,837,314.88. Pursuant to the terms of the Offering, each eligible holder of Class A Ordinary Shares (each, a “Shareholder”) was entitled to subscribe for 0.10 of a Class A Ordinary Share for every right held by such Shareholder.

The Company intends to use the net proceeds of the Offering to refinance existing debt and for general corporate purposes.

Pursuant to the Offering, the Company issued 2,402,135 Class A Ordinary Shares under the basic subscription privilege, of which, to the knowledge of the Company after reasonable inquiry, 1,953,330 Class A Ordinary Shares were issued to insiders (including 1,946,032 Class A Ordinary Shares issued to Fortis Energy (Bermuda) Ltd., a wholly-owned subsidiary of Fortis Inc. (the “Stand-By Purchaser”), the Company’s controlling Shareholder). Pursuant to the Offering, the Company also issued 159,356 Class A Ordinary Shares under the additional subscription privilege, of which, to the knowledge of the Company after reasonable inquiry, 4,482 Class A Ordinary Shares were issued to insiders (none of which were issued to the Stand-By Purchaser). The remaining 797,871 Class A Ordinary Shares were issued by the Company to the Stand-By Purchaser pursuant to the terms of the stand-by purchase agreement dated August 24, 2020 entered into between the Company and the Stand-By Purchaser (the “Stand-By Commitment”).

Following completion of the Offering FEBL owns 60% of the issued and outstanding Class A Ordinary Shares on a non-diluted basis. No fee was payable by the Company to FEBL in respect of the Stand-By Commitment. The Company agreed to pay the reasonable fees and out-of-pocket expenses of FEBL in connection with the negotiation and execution of the Stand-By Agreement. A copy of the early warning report filed by the Stand-By Purchaser on August 24, 2020 is available on the Company’s profile at www.sedar.com.

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