Represents $500.0 million transaction by CGI
MONTRÉAL, June 11, 2019 /PRNewswire/ - CGI (TSX: GIB.A) (NYSE: GIB) announced today that it intends to enter into a private agreement with Caisse de dépôt et placement du Québec ("la Caisse") for the purchase for cancellation of 5,158,362 of its Class A subordinate voting shares ("Class A Shares") held by la Caisse for a price of $96.93 per Class A Share, which represents a discount to today's closing price of the Class A Shares on the Toronto Stock Exchange ("TSX").
The transaction will be made in connection with the periodic portfolio rebalancing of la Caisse. Once completed, la Caisse will continue to hold approximately 37.4 million Class A Shares, representing approximately 13.9 % of CGI's total outstanding shares.
"CDPQ rebalances its portfolio periodically, during the right conditions. CGI has delivered excellent results for its shareholders, and this transaction is an opportunity to monetize a portion of our investment in the company to the benefit of our depositors," said Charles Émond, Executive Vice-President and Head of Québec Investments and Global Strategic Planning at CDPQ. "Following this transaction, we will continue as a significant shareholder of the company, and given the long-term nature of this investment, we intend to remain so to support the growth of this information technology leader. CGI is well positioned to continue its success at home and in international markets."
"This transaction is immediately accretive and consistent with our value creation strategy," said François Boulanger, Executive Vice-President and Chief Financial Officer, CGI. "We remain very well positioned to continue executing our Build and Buy profitable growth strategy through our strong cash flow generation and access to our credit facility."
A favourable decision was obtained from the Autorité des marchés financiers to exempt CGI from the issuer bid requirements under securities legislation applicable to the transaction, which will be made at a discount in accordance with the decision and is expected to be entered into later today and settled on June 13, 2019.
The share repurchase will be made under CGI's normal course issuer bid ("NCIB"), the renewal of which was announced on January 30, 2019. Under the NCIB, CGI is authorized to repurchase up to 20,100,499 Class A Shares by February 5, 2020. The NCIB allows for purchases outside the facilities of the TSX by private agreements pursuant to exemption orders issued by securities regulators. As at June 11, 2019, 573,070 shares had been repurchased under the NCIB.
Information regarding the share repurchase, including the number of Class A Shares purchased for cancellation and aggregate price paid, will be available on the SEDAR website at sedar.com following the completion thereof. CGI will not issue any additional press release in respect of this share repurchase.
Founded in 1976, CGI is among the largest independent IT and business consulting services firms in the world. With approximately 77,000 consultants and professionals across the globe, CGI delivers an end-to-end portfolio of capabilities, from IT and business consulting to systems integration, outsourcing services and intellectual property solutions. CGI works with clients through a local relationship model complemented by a global delivery network that helps clients digitally transform their organizations and accelerate results. With Fiscal 2018 reported revenue of C$11.5 billion, CGI shares are listed on the TSX (GIB.A) and the NYSE (GIB). Learn more at cgi.com.
About Caisse de dépôt et placement du Québec
Caisse de dépôt et placement du Québec (CDPQ) is a long-term institutional investor that manages funds primarily for public and parapublic pension and insurance plans. As at December 31, 2018, it held CA$309.5 billion in net assets. As one of Canada's leading institutional fund managers, CDPQ invests globally in major financial markets, private equity, infrastructure, real estate and private debt. CDPQ is present in India through its subsidiary CDPQ India, located in New Delhi. For more information, visit cdpq.com, follow us on Twitter @LaCDPQ or consult our Facebook or LinkedIn pages.
Forward-looking information and statements
This press release contains "forward-looking information" within the meaning of Canadian securities laws and "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and other applicable United States safe harbours. All such forward-looking information and statements are made and disclosed in reliance upon the safe harbour provisions of applicable Canadian and United States securities laws. Forward-looking information and statements include all information and statements regarding CGI's intentions, plans, expectations, beliefs, objectives, future performance, and strategy, as well as any other information or statements that relate to future events or circumstances and which do not directly and exclusively relate to historical facts. Forward-looking information and statements often but not always use words such as "believe", "estimate", "expect", "intend", "anticipate", "foresee", "plan", "predict", "project", "aim", "seek", "strive", "potential", "continue", "target", "may", "might", "could", "should", and similar expressions and variations thereof. These information and statements are based on our perception of historic trends, current conditions and expected future developments, as well as other assumptions, both general and specific, that we believe are appropriate in the circumstances. Such information and statements are, however, by their very nature, subject to inherent risks and uncertainties, of which many are beyond the control of CGI, and which give rise to the possibility that actual results could differ materially from our expectations expressed in, or implied by, such forward-looking information or forward-looking statements. These risks and uncertainties include but are not restricted to: risks related to the market such as the level of business activity of our clients, which is affected by economic and political conditions, and our ability to negotiate new contracts; risks related to our industry such as competition and our ability to attract and retain qualified employees, to develop and expand our services, to penetrate new markets, and to protect our intellectual property rights; risks related to our business such as risks associated with our growth strategy, including the integration of new operations, financial and operational risks inherent in worldwide operations, foreign exchange risks, income tax laws, our ability to negotiate favorable contractual terms, to deliver our services and to collect receivables, and the reputational and financial risks attendant to cybersecurity breaches and other incidents; as well as other risks identified or incorporated by reference in this press release, in CGI's annual and quarterly MD&A and in other documents that we make public, including our filings with the Canadian Securities Administrators (on SEDAR at www.sedar.com) and the U.S. Securities and Exchange Commission (on EDGAR at www.sec.gov). Unless otherwise stated, the forward-looking information and statements contained in this press release are made as of the date hereof and CGI disclaims any intention or obligation to publicly update or revise any forward-looking information or forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. While we believe that our assumptions on which these forward-looking information and forward-looking statements are based were reasonable as at the date of this press release, readers are cautioned not to place undue reliance on these forward-looking information or statements. Furthermore, readers are reminded that forward-looking information and statements are presented for the sole purpose of assisting investors and others in understanding our objectives, strategic priorities and business outlook as well as our anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes. Further information on the risks that could cause our actual results to differ significantly from our current expectations may be found in the section titled "Risk Environment" of CGI's annual and quarterly MD&A, which is incorporated by reference in this cautionary statement. We also caution readers that the above-mentioned risks and the risks disclosed in CGI's annual and quarterly MD&A and other documents and filings are not the only ones that could affect us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial could also have a material adverse effect on our financial position, financial performance, cash flows, business or reputation.
SOURCE CGI Inc.