Intercable ICH Inc. Plans 6 Million Euros Private Placement and 13 Million Euros Debt Facility and Signs Additional Bridge Loan
06 Mars 2009 - 1:09AM
Marketwired
Intercable ICH Inc. (TSX VENTURE: ICH) ("Intercable"), a Canadian
telecommunications company that seeks broadband telecommunications
opportunities in the international market, announced today that it
is considering a private placement of 6 million euros
(approximately CAN $9.6 million), and is proceeding to a price
reservation at conditions described here below, together with a
debt facility of 13 million euros (approximately CAN $21.08
million). This financing is subject to the completion of a
satisfactory due diligence, the other usual closing conditions, the
obtaining of proper authorizations from the concerned parties and
regulatory approval. The considered 6 million euros private
placement would be subscribed in common shares of Intercable at a
price of $0.35 per share, and/or in shares of a subsidiary of
Intercable at a price per share equivalent to $0.35 per share of
Intercable. A warrant would also be issued for each share
subscribed at the level of Intercable at an exercise price of $1.50
per warrant share. The warrants would be valid up to April 4, 2010.
The debt facility would have a term of 6 years from the first
drawdown, would carry interest at a rate equal to the 6 month LIBOR
plus 7% (subject to a minimum rate of 8% and a maximum rate of 12%)
and would be secured by a first rank security on all the assets of
Intercable and its subsidiaries. Drawdowns under the debt facility
would be available under certain financial and operational
covenants. Upon the conditions described here above, a current
insider of the company could participate in the investment. The
proceeds from this financing would be used by Intercable to finance
the build-out of its broadband network in Reunion Island and to
repay its outstanding bridge loans expected to equal 4.5 million
euros (approximately CAN $7.19 million) at closing of the planned
financing. Due diligence and approval processes are expected to
last several weeks. There is no guarantee that Intercable will be
able to finalize this financing upon the terms described above or
at all.
Interim Financing
Intercable has signed a new bridge loan of 500,000 euros
(approximately $795,000) with The Mauritius Commercial Bank Ltd
(MCB), a bank affiliated to MCB Equity Fund, a shareholder and
insider of Intercable, permitting the company to continue its
operations during March 2009. The bridge loan shall be disbursed at
the discretion of The Mauritius Commercial Bank Ltd and subject to
no adverse material changes. The bridge loan is repayable on May
31, 2009, carries interest at a rate equal to 3 month LIBOR + 7%,
is guaranteed first rank by all the assets of Intercable and its
subsidiairies and by a guarantee from two shareholders and insiders
of Intercable, and is subject to other usual terms and conditions
for this type of transaction. This bridge loan is in addition to
the bridge financings now totalling 4 million euros and which have
already been disbursed.
The bridge loan constitutes a "related party transaction" for
Intercable pursuant to Regulation 61-101 respecting Protection of
Minority Security Holders in Special Transactions ("Regulation
61-101"), which requires Intercable to obtain a formal valuation
and the minority approval of its holders in connection with the
bridge loan unless there is an exemption available from those
requirements.
Intercable benefits from an exemption from the requirements to
obtain a formal valuation and the minority approval in connection
with the execution of the bridge loan given that the board of
directors of Intercable, acting in good faith, has determined that
the following conditions have been met and all of the independent
directors of Intercable have confirmed such opinion: i) Intercable
is in serious financial difficulty; ii) the bridge loan is designed
to improve the financial position of Intercable; and iii) the terms
of the bridge loan are reasonable in the circumstances of
Intercable. Ziyad Bundhun, representative of MCB Equity Fund Ltd on
the board of directors of Intercable, has not voted in connection
with the approval of the bridge loan.
About Intercable
Intercable is a Canadian telecommunications corporation that
seeks broadband telecommunications opportunities in the
international market. Intercable's business strategy is to focus on
underserved telecommunications and cable markets by building and
operating its own broadband networks using state-of-the-art
technology capable of offering cable television, high-speed
Internet and telephony services, at a low cost and with high
service quality. The Corporation targets markets with i) limited or
no cable service; ii) feasibility of aerial cable construction; and
iii) stable political environments. Management believes that
Reunion Island currently represents the most significant growth
opportunity for Intercable.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this press release.
This press release contains forward-looking statements that are
subject to known and unknown risks and uncertainties that could
cause actual results to vary materially from targeted results. Such
risks and uncertainties include those described in Intercable's
annual information form dated July 8, 2008 or in the filings made
by Intercable from time to time with securities regulators.
Intercable undertakes no obligation to publicly release the result
of any revision of these forward-looking statements to reflect
events or circumstances after the date they are made or to reflect
the occurrence of unanticipated event.
For additional information, please visit the company's website
at www.intercable.ca
Contacts: Intercable ICH Inc. Guy Laflamme President and Chief
Executive Officer 450-582-7953 guylaflamme@intercable.ca Intercable
ICH Inc. Serge Dupuis Chief Financial Officer 514-904-0163
sergedupuis@intercable.ca
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