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Caribbean Utilities Company, Ltd. is listed for trading in United States dollars on the Toronto Stock Exchange under the trading symbol "CUP.U".
GRAND CAYMAN, Cayman Islands, Nov. 4, 2024 /CNW/ - Caribbean Utilities Company, Ltd. (TSX: CUP.U) ("CUC" or the "Company") announced today that it has successfully completed its previously announced rights offering (the "Offering"), which expired at 4:00 p.m. (Toronto time) on October 31, 2024. Following completion of the Offering, the Company has 42,045,283 Class A Ordinary shares (the "Class A Ordinary Shares") issued and outstanding.
Upon closing of the Offering, the Company issued 3,822,298 Class A Ordinary Shares at a price of US$13.41 per Class A Ordinary Share for aggregate gross proceeds of US$51,257,016.18. Pursuant to the terms of the Offering, each eligible holder of Class A Ordinary Shares (each, a "Shareholder") was entitled to subscribe for 0.10 of a Class A Ordinary Share for every right held by such Shareholder.
The Company intends to use the net proceeds of the Offering to finance alternative energy projects, ongoing additions and upgrades to CUC's generation, transmission, and distribution systems, and for general corporate purposes.
Pursuant to the Offering, the Company issued 2,729,142 Class A Ordinary Shares under the basic subscription privilege, of which 2,225,323 Class A Ordinary Shares were issued to insiders (including 2,220,422 Class A Ordinary Shares issued to Fortis Energy Caribbean Inc. ("FECI" or the "Stand-By Purchaser"), a wholly-owned subsidiary of Fortis Inc., the Company's controlling Shareholder). The Company issued 166,377 Class A Ordinary Shares under the additional subscription privilege, of which no Class A Ordinary Shares were issued to insiders. The remaining 926,779 Class A Ordinary Shares were issued by the Company to the Stand-By Purchaser pursuant to the terms of the stand-by purchase agreement dated September 20, 2024 entered into between the Company and the Stand-By Purchaser (the "Stand-By Commitment").
Following completion of the Offering, FECI owns approximately 60% of the issued and outstanding Class A Ordinary Shares on a non-diluted basis, which percentage holding increased by approximately 2% as a result of the Offering. No fee was payable by the Company to FECI in respect of the Stand-By Commitment. The Company agreed to pay the reasonable fees and out-of-pocket expenses of FECI in connection with the negotiation and execution of the Stand-By Agreement. A copy of the early warning report filed by the Stand-By Purchaser on September 20, 2024 is available on the Company's profile at www.sedarplus.ca
To the knowledge of the Company after reasonable inquiry, no person that was not an insider of the Company before the Offering became an insider as a result of the Offering. As soon as practicable, the Company will disclose the number of Class A Ordinary Shares issued under the Offering to any other insiders of the Company under the basic subscription privilege and the additional subscription privilege, to the knowledge of the Company after reasonable inquiry, as required by applicable securities laws.
Richard Hew, President and Chief Executive Officer of CUC commented "We are pleased to complete this offering with the support of our existing Class A Ordinary shareholders, including the standby commitment made by FECI. We welcome this engagement by our shareholders and the completion of the offering which provides the strong financial base necessary to expand and improve our infrastructure, including sustainability and efficiency projects".
About CUC
The principal activity of the Company is to generate, transmit and distribute electricity in its licence area of Grand Cayman, Cayman Islands, pursuant to a 20-year Transmission & Distribution ("T&D") Licence and a 25-year non-exclusive Generation Licence (the "Generation License" and together with the T&D Licence, the "Licences") granted by the Cayman Islands Government (the "Government", "CIG"). The T&D Licence, which expires in April 2028, contains provisions for an automatic 20-year renewal and the Company has reasonable expectation of renewal until April 2048. The Generation Licence expires in November 2039. Further information is available at www.cuc-cayman.com.
Caribbean Utilities Company, Ltd. ("CUC" or "the Company"), on occasion, includes forward-looking statements in its media releases, Canadian securities regulatory authorities filings, shareholder reports and other communications. Forward-looking statements include statements that are predictive in nature, depend upon future events or conditions, or include words such as "expects", "anticipates", "plan", "believes", "estimates", "intends", "targets", "projects", "forecasts", "schedule", or negative versions thereof and other similar expressions, or future or conditional verbs such as "may", "will", "should", "would" and "could". The forward-looking statements contained in this news release include, but are not limited to, the intended use of proceeds of the Offering. Forward-looking statements are based on underlying assumptions and management's beliefs, estimates and opinions, and are subject to certain risks and uncertainties surrounding future expectations generally that may cause actual results to vary from plans, targets and estimates. Such risks and uncertainties include but are not limited to operational, general economic, market and business conditions, regulatory developments and weather conditions. CUC cautions readers that actual results may vary significantly from those expected should certain risks or uncertainties materialize or should underlying assumptions prove incorrect. Forward-looking statements are provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that such information may not be appropriate for other purposes. The Company disclaims any intention or 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.
