Trimac’s founding family looks to buy back the fleet
CALGARY, Alta. – Trimac Corporation – one of Canada’s few publicly traded trucking operations – announced Sept. 22 that it has a proposal to remove the company from the Toronto Stock Exchange and take it private.
In a press release, Trimac, which is one of the largest bulk trucking companies in North America, said it received the proposal from a company controlled by Trimac chairman J.R McCaig and chief executive officer J.J. McCaig. The McCaig family founded the company more than 50 years ago and owns or controls about 22 per cent of company stock, or about 6.1 million shares.
The proposed deal would see all Trimac shareholders, other than those participating in the transaction, receiving $9.50 for each share.
At that price, and with about 27.4 million shares outstanding, the value of the offer is $260.3 million in cash.
The company that has made the proposal, referred to in the release as “Newco”, has entered into letters of intent with financial institutions, securing the funds the transaction requires.
Newco said it also has agreements with other members of the McCaig family, as well as Trimac management. These people currently own or control about 12 per cent of the company, or about 3.4 million Trimac shares.
Newco said it has also received “support agreements” with institutional shareholders owning or controlling about 51 per cent, or about 14 million Trimac shares.
Since Trimac is a publiclytraded company, the transaction needs to pass several stages of approval, including Trimac board and shareholder approval, provincial approval under the Business Corporations Act of Alberta, and approval of the Ontario Securities Commission (because the TSE is in Toronto).
Nonetheless, the “going-private” transaction is expected to be completed by Nov. 30.
“The members of the McCaig family are committed to a long-term strategy of growing the company’s bulk trucking business,” said Terry Owens, Trimac vice-president and chief financial officer.
“I think (the McCaig’s) believe the privatization will bring stability to the ownership of Trimac, and enhance the company to pursue its strategy,” Owens said in a telephone interview. “This is a further commitment to the bulk-trucking business.”
As for the company’s plans once it is off the stock market, Owens said there won’t be any surprises. “Trimac has had a strategy of growing its bulk trucking business, and if anything, (going private) is just a further commitment to that strategy. So in terms of interface with customers and buyers, and the trucking community in general, I don’t think there’s any change at all. I think, if anything, it’ll even be more positive.”
Owens didn’t disclose any of Trimac’s plans for the future. “If the right opportunities present themselves, we would like to actively pursue those things. But I think going forward we’re just in the same position. When you think about it, what goes on in the trucking business is still going to go on. All that’s happened is we have some different shareholders, effectively.” n
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