VICTORIA, British Columbia, Aug. 23, 2017 (GLOBE NEWSWIRE) -- Carmanah Technologies Corporation (TSX:CMH) (“the Company” or “Carmanah”) announces the following.
Effective today, Michael W. Sonnenfeldt has announced his resignation as Chairman of the Board of Directors.
“Just over four years ago, Michael Sonnenfeldt joined our Board as Chairman,” said John Simmons, Chief Executive Officer. “As Carmanah’s largest shareholder, Michael had a vision that Carmanah could become a world class designer, manufacturer and distributor of solar related infrastructure equipment that would represent the most environmentally sensitive and best economic alternative for our customers. From the beginning, he provided the strategic guidance that allowed the transformation of Carmanah from a company with a history of losses to one that is now solidly profitable. In addition, Michael personally led a much-needed recapitalization of the company and set the foundation for the substantive growth in the Company’s market capitalization. During his tenure, our share price has risen from a low of 90 cents per share to a price, today, that is five times that amount. Also during his tenure, our market capitalization grew from below CAD $10 million and today exceeds CAD $100 million. Lastly, Michael enabled Carmanah to set a new strategic course. Within that context, we expanded to Europe with our acquisition of the Sabik Group of Companies and to the Pacific Region with our recent acquisition of New Zealand-based Vega Industries Inc. Today Carmanah has more than $25 million in cash and is consistently profitable. Our Telematics initiative is a direct outgrowth of his creativity. Without Michael’s dedication, it is highly unlikely that we would have achieved all that we have. I want to thank him for his contribution and wish him great success in his future endeavours.”
“With all of the great progress the company has made over the past four years, the recent successful sales of the two power divisions will now allow a streamlined focus on Carmanah’s Signalling and related Illumination and Telematics opportunities,” Sonnenfeldt said. “I feel like my work is now finished and I leave the company in great financial condition with an outstanding leadership team. I feel fortunate to have worked with John who, as CEO, has led the transformation. The team he has built is immeasurably stronger than the one he inherited. I have worked with Jim Meekison, who will replace me as Chair and as largest shareholder. He will make an outstanding Chairman, and the company is lucky to have him serve in that capacity. I wish him and the entire team all the best.”
Recent Insider Transactions
Just prior to his resignation from the Board, entities controlled by Mr. Sonnenfeldt sold 4,087,443 common shares of Carmanah (“Shares”) to an entity controlled by Mr. Jim Meekison, a director and insider of Carmanah for CAD $5.00 per Share, for an aggregate purchase price of CAD $20,437,215. In addition, entities controlled by Mr. Sonnenfeldt sold 117,808 Shares and certain other shareholders sold 482,192 Shares to an entity controlled by another director and insider of Carmanah, for CAD$5.00 per Share, for an aggregate purchase price of CAD$3,000,000 (the “Transactions”). Following the Transactions, entities controlled by Mr. Sonnenfeldt’s still remain significant shareholders of Carmanah, owning approximately 10.0% of the company’s common shares, in the aggregate.
Jim Meekison to become Chairman
Mr. Sonnenfeldt’s successor Jim Meekison has agreed to serve as Carmanah’s Board Chairman. His appointment dovetails with Mr. Sonnenfeldt’s resignation.
“Jim Meekison has been a significant Carmanah shareholder for more than three years,” said John Simmons. “His increased shareholdings and preparedness to serve as chairman of our board of directors signals his confidence in our business plan. I look forward to working with him in his new role.”
Substantial Issuer Bid
Carmanah also announces that it intends to launch a Substantial Issuer Bid (“SIB”) pursuant to which Carmanah will offer to acquire up to 6.0 million Shares for CAD $5.00 per Share from existing shareholders. Shares acquired through the SIB will be cancelled and returned to treasury. Should more than 6.0 million Shares be tendered into the SIB, Shares will be acquired on a proportional basis from all tendering shareholders. The SIB is expected to be launched imminently and remain in effect for 35-days. Should all 6.0 million Shares be acquired through the SIB, Carmanah will have approximately 18,645,250 Shares outstanding.
Certain insiders intend to tender some of their shareholdings into the SIB. These intentions will be disclosed in the SIB offering document but will include the intention of an entity controlled by Mr. Meekison to tender a portion of his Shares to the extent that, after the effect of the SIB, Mr. Meekison hopes that he will beneficially own approximately 25% of the issued and outstanding Shares.
Early Warning Report Information
Prior to the Transactions, Mr. Sonnenfeldt owned, directly or indirectly, or exercised control or direction over 6,675,462 Shares and 100,000 options to acquire Shares (“Options”). After the completion of the Transactions, Mr. Sonnenfeldt now owns, directly or indirectly, or exercises control or direction over, 2,470,211 Shares and 100,000 Options. The 2,470,211 Shares represent approximately 10.0% of the total number of issued and outstanding Shares.
Mr. Meekison acquired ownership of the 4,087,443 Shares through two private transactions (the “Acquisitions”) made in reliance on the private agreement exemption set out in section 4.2 of National Instrument 62-104 Take-Over Bids and Issuer Bids. The Acquisitions were completed through Trimin Capital Corp., an entity controlled by Mr. Meekison, and located in Toronto, Canada.
Prior to the Acquisitions, Mr. Meekison owned, directly or indirectly, or exercised control or direction over 2,963,700 Shares and 100,000 options to acquire Shares (“Options”). After the completion of the Acquisitions, Mr. Meekison now owns, directly or indirectly, or exercises control or direction over, 7,051,143 Shares and 100,000 Options. The 7,051,143 Shares represent approximately 28.6% of the total number of issued and outstanding Shares.
Mr. Meekison’s acquisitions were made for investment purposes. In addition to tendering Shares to the SIB, as described above, Mr. Meekison may, in the future, increase or decrease his beneficial ownership, control or direction over securities of Carmanah.
About Carmanah Technologies Corporation
Carmanah designs, develops and distributes a portfolio of products focused on energy optimized LED solutions for infrastructure. Since 1996, we have earned a global reputation for delivering durable, dependable, efficient and cost-effective solutions for industrial applications that perform in some of the world’s harshest environments. We manage our business within two reportable segments: Signals and Illumination. The Signals segment serves the Airfield Ground Lighting, Aviation Obstruction, Offshore Wind, Marine, Traffic and Telematics markets. The Illumination segment provides solar powered LED outdoor lights for municipal and commercial customers.
This release may contain forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as “expects,” “estimates,” “could,” “will” or variations of such words and phrases. Forward-looking statements or information in this news release relate to, among other things: Carmanah’s intent to launch the SIB and the intention of certain shareholders, including Mr. Meekison, to tender Shares to the SIB. Forward-looking statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of Carmanah to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. Such factors include, but are not limited to: our ability to complete the SIB. These forward-looking statements are based on management’s current expectations and beliefs but given the uncertainties, assumptions and risks, readers are cautioned not to place undue reliance on such forward-looking statements or information. Carmanah disclaims any obligation to update, or to publicly announce, any such statements, events or developments except as required by law.
For additional information on these risks and uncertainties, see Carmanah’s most recently filed Annual Information Form (“AIF”) and Annual MD&A, which are available on SEDAR at www.sedar.com and on the Company’s website at www.carmanah.com. The risk factors identified in Carmanah’s AIF and MD&A are not intended to represent a complete list of factors that could affect Carmanah.