February 6, 2019 | Montréal, Québec
5N Plus Inc. (TSX:VNP) (“5N Plus” or the “Company”), a leading global producer of engineered materials and specialty chemicals, announced today the closing of a US$25 million unsecured subordinated term loan with Investissement Québec. Since the launch of its strategic plan 5N21, the Company has been delivering compelling results in line with the targets defined by the plan. During this time, 5N Plus has continued to undergo a transformation which is taking it from manufacturing and sales of specialty metals and chemicals to that of engineered materials, the result of which has been margin expansion and markedly improved return on capital employed.
As 5N Plus nears the half-way point of its strategic plan, it is expected that more emphasis will be placed on the development of its growth initiatives along with further investment in efficiency gains from its core businesses. To that end, it is expected that the proceeds from the unsecured term loan will be utilized to support these programs along with the repayment of the balance of the unsecured convertible debentures issued by the Company in 2014; which will mature on June 30, 2019. The new loan has a five-year term and will be disbursed in two tranches: the first tranche of US$5 million on February 6, 2019 and the second tranche of US$20 million by no later than March 29, 2019. The new term loan will bear an interest equivalent to the 5-year US dollar swap rate plus a margin of 4.19% which as of today equates to approximately 6.80%.
Richard Perron, Chief Financial Officer, commented “The new term loan and our recently renewed senior revolving credit facility constitute a well-balanced portfolio of financing for 5N Plus. With this backbone, our Company is ideally positioned to fund its future ambitions defined by 5N21 while addressing both flexibility and cost effectiveness.” Mr. Perron added “The new financing structure avoids dilution potential for our shareholders, mainly as it pertains to convertible debt instruments.” Mr. Perron concluded “As we continue to transform our Company and deliver tangible value, we are elated to have the support of Investissement Québec, an important institution in the local business community”.
5N Plus is a leading global producer of engineered materials and specialty chemicals with integrated recycling and refining assets to manage the sustainability of its business model. The Company is headquartered in Montreal, Québec, Canada and operates R&D, manufacturing and commercial centers in several locations in Europe, the Americas and Asia. 5N Plus deploys a range of proprietary and proven technologies to produce products which are used as enabling precursors by its customers in a number of advanced electronics, opto-electronics, pharmaceutical, health, renewable energy and industrial applications. Many of the materials produced by 5N Plus are critical for the functionality and performance of the products and systems produced by its customers, many of whom are leaders within their industry.
This press release may contain forward-looking information within the meaning of applicable securities laws. All information and statements other than statements of historical facts contained in this press release are forward-looking information. Such statements and information may be identified by words such as “about”, “approximately”, “may”, “believes”, “expects”, “will”, “intends”, “should”, “plans”, “predicts”, “potential”, “projects”, “anticipates”, “estimates”, “continues” or similar words or the negative thereof or other comparable terminology. Forward-looking statements are based on the best estimates available to 5N Plus at this time and involve known and unknown risks, uncertainties and other factors that may cause 5N Plus’ actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. A description of the risks affecting 5N Plus’ business and activities appears under the heading “Risk and Uncertainties” of 5N Plus’ 2017 MD&A dated February 20, 2018 and note 12 of the unaudited condensed interim consolidated financial statements for the three and nine-month periods ended September 30, 2018 and 2017 available on SEDAR at www.sedar.com. No assurance can be given that any events anticipated by the forward-looking information in this press release will transpire or occur, or if any of them do so, what benefits that 5N Plus will derive therefrom. In particular, no assurance can be given as to the future financial performance of 5N Plus. The forward-looking information contained in this press release is made as of the date hereof and 5N Plus undertakes no obligation to publicly update such forward-looking information to reflect new information, subsequent or otherwise, unless required by applicable securities laws. The reader is warned against placing undue reliance on these forward-looking statements.
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5N Plus Inc.
(514) 856-0644 x6178