George Weston Limited announces agreement to purchase additional $500 million in Loblaw Companies Limited common shares to finance portion of Loblaw's acquisition of Shoppers Drug Mart Corporation
TORONTO, July 15, 2013 /CNW/ - George Weston Limited (TSX: WN) ("Weston" or "the Company") today announced that it will subscribe for 10,515,247 Loblaw Companies Limited ("Loblaw") common shares valued at $500 million. Proceeds from the private placement will be used to finance a portion of the cash consideration to be paid by Loblaw as part of its acquisition of Shoppers Drug Mart Corporation. The price per share to be paid by Weston will be $47.55, which was Loblaw's closing share price on July 12, 2013 and the same price at which shares are being issued to Shoppers Drug Mart shareholders under the transaction. Loblaw and Shoppers Drug Mart announced the combination earlier today.
Weston is Loblaw's controlling shareholder, with voting ownership of approximately 63% of Loblaw's common shares. Taking into consideration its current holdings and those to be purchased through the private placement, Weston will have voting ownership of approximately 46% of Loblaw's common shares upon completion of the acquisition.
W. Galen Weston, Executive Chairman of Weston said, "This investment underscores our strong support of this transaction and the value that can be generated by combining Loblaw, Canada's leading food retailer, and Shoppers Drug Mart, the country's leading pharmacy retailer. By joining forces, the combined company will be uniquely positioned to better serve Canadian consumers and have the means to bring exciting innovations to the Canadian marketplace, leading to even stronger growth and profitability."
About George Weston Limited
George Weston Limited is one of North America's largest food processing and distribution groups operating in two segments: baking through Weston Foods, and food and general merchandise distribution through Loblaw Companies Limited.
This News Release for George Weston Limited (the "Company") contains forward-looking statements about the proposed acquisition by its subsidiary, Loblaw Companies Limited ("Loblaw") of all of the outstanding common shares of Shoppers Drug Mart Corporation. These statements reflect the Company's current expectations regarding the future operating and financial performance of the combined company. The Company's estimates, beliefs and assumptions are inherently subject to significant business, economic, competitive and other risks and uncertainties regarding future events and as such, are subject to change.
There can be no assurance that the proposed transaction will occur or that the anticipated strategic benefits and operational, competitive and cost synergies will be realized. The proposed transaction is subject to various regulatory approvals, including approval under the Competition Act and by the TSX, and the fulfillment of certain conditions, and there can be no assurance that any such approvals will be obtained and/or any such conditions will be met. The proposed transaction could be modified, restructured or terminated.
Readers are cautioned that the foregoing list of factors is not exhaustive. Other risks and uncertainties not presently known to the Company or that the Company presently believes are not material could also cause actual results or events to differ materially from those expressed in its forward-looking statements. Additional information on these and other factors that could affect the operations or financial results of the Company included in reports filed by the Company with applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com).
Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect the Company's expectations only as of the date of this News Release. The Company disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
SOURCE George Weston Limited