LONGUEUIL, QC, Nov. 9, 2012 /CNW Telbec/ - Héroux-Devtek Inc. (TSX: HRX),
("Héroux-Devtek" or the "Corporation"), a leading Canadian manufacturer of
aerospace products, is pleased to announce that its Board of Directors has
authorized a special cash distribution of $5.00 per share to be paid on
December 19, 2012 (the "Payment Date") to shareholders of record on November
20, 2012 (the "Record Date").
The special distribution follows the sale by Héroux-Devtek of substantially
all of its Aerostructure and Industrial Products operations (the "Sale
Transaction") at the end of August 2012. The Board of Directors determined
that the special distribution represents an appropriate use of
Héroux-Devtek's financial resources following the completion of the Sale
Transaction, as it provides shareholders with an adequate return on their
investment, while allowing the Corporation to maintain a healthy financial
position. The Board of Directors decided to retain financial resources to
ensure adequate funding of expected capital and other investments and
potential opportunities for future growth, including strategic acquisitions.
It will periodically review Héroux-Devtek's cash position and capital
requirements and evaluate alternatives available to Héroux-Devtek to enhance
As the amount of the special distribution exceeds 25% of Héroux-Devtek's
current stock price, the Toronto Stock Exchange will require that the shares
trade on a "due bill" basis from the opening of trading on November 16, 2012
to the close of trading on the Payment Date. This means that sellers of shares
during that period (i.e. sellers in trades settled after the Record Date and
entered into on or before the Payment Date) will also sell to the purchasers
their entitlement to the special distribution. The shares will commence
trading on an ex-distribution basis (i.e. without an attached "due bill"
entitlement to the special distribution) from the opening of trading on
December 20, 2012.
In order to implement the special distribution, the Board of Directors has
called a special shareholder meeting to be held on December 18, 2012 to
consider the adoption of a special resolution to reduce the amount of the
Corporation's issued share capital by $2.70 per share and repay such amount on
the Payment Date to shareholders of record on the Record Date. The meeting
will take place at 10 a.m. in the Salon Printemps of the OMNI Mont-Royal
Hotel, 1050 Sherbrooke Street West, in the City of Montréal, Québec. The
Board of Directors has also fixed the Record Date as the record date to
determine shareholders entitled to receive notice and vote at the special
The Board of Directors has also declared a special cash dividend, to be paid
on the Payment Date to shareholders of record on the Record Date, in an amount
to be equal to the difference between $5.00 per share and the per share amount
of the capital reduction and repayment that will be approved by the
shareholders at the meeting, if any.
Therefore, if the capital reduction and repayment is approved at the special
shareholder meeting, the special cash distribution of $5.00 per share ($160.0
million based on up to 32 million common shares) will be composed of a capital
reduction and repayment of $2.70 per share ($86.4 million) and a special cash
dividend of $2.30 per share ($73.6 million), and a shareholder will, under
certain circumstances, not be subject to tax on the amount of the capital
reduction and repayment or, at the very least, be able to treat the amount of
the capital reduction and repayment that is in excess of the shareholder's
cost base in the shares as a capital gain. If the capital reduction is not
approved at the meeting, the special cash distribution will consist of a
dividend of $5.00 per share.
Full details of the special distribution and proposed capital reduction and
repayment, including a summary description of the principal Canadian federal
income tax considerations applicable to shareholders in connection with the
special distribution, will be included in the management proxy circular that
will be mailed to shareholders on or about November 26, 2012.
About Héroux-Devtek Inc.
Héroux-Devtek Inc. (TSX: HRX) is a Canadian company specializing in the
design, development, manufacture and repair and overhaul of landing gear
systems and components for the Aerospace market. The Corporation is the third
largest landing gear company in the world, supplying both the commercial and
military sectors of the Aerospace market with new landing gear systems and
components, as well as aftermarket products and services. Approximately 70% of
the Corporation's sales are outside Canada, mainly in the United States. The
Corporation's head office is located in Longueuil, Québec with facilities in
the Greater Montreal area (Longueuil, Laval and St-Hubert); Kitchener and
Toronto, Ontario; as well as Springfield and Cleveland, Ohio.
Except for historical information provided herein, this press release may
contain information and statements of a forward-looking nature concerning the
future performance of the Company. These statements are based on suppositions
and uncertainties as well as on management's best possible evaluation of
future events. Such factors may include, without excluding other
considerations, fluctuations in quarterly results, evolution in customer
demand for the Company's products and services, the impact of price pressures
exerted by competitors, and general market trends or economic changes. As a
result, readers are advised that actual results may differ from expected
From: Héroux-Devtek Inc. Gilles Labbé President and Chief Executive Officer
Tel.: (450) 679-3330
Contact: MaisonBrison Martin Goulet, CFA Tel.: (514) 731-0000
SOURCE: HEROUX-DEVTEK INC.
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