CanWel Building Materials Group Ltd. Announces $75 MIllion Bought Deal Equity Offering

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VANCOUVER, BC, April 21, 2021 /CNW/ - CanWel Building Materials Group Ltd. ("CanWel" or "the Company") (TSX: CWX) (TSX: CWX.NT.A) is pleased to announce that it has entered into an agreement with a syndicate of underwriters co-led by Stifel GMP and National Bank Financial Inc. (collectively, the "Underwriters"), who have agreed to purchase, on a "bought deal" basis 7,500,000 common shares (the "Common Shares") of the Company at a price of $10.00 per Common Shares, for aggregate gross proceeds of $75,000,000 (the "Offering"). The Underwriters will also have the option, exercisable in whole or in part at any time on or up to 30 days after the closing of the Offering, to purchase up to an additional 1,125,000 Common Shares. In the event that the option is exercised in its entirety, the aggregate gross proceeds of the Offering will be $86,250,000.

Given recent robust business activity levels and cash flow generation, the Company has successfully reduced its net debt levels and is now seeing increased acquisition opportunities across North American in both building products distribution and pressure treating. The Company seeks to have the ability to move rapidly to take advantage of attractive and strategic acquisition opportunities as they materialize. As such, the net proceeds of the Offering will initially be used to reduce funded debt levels until required for future acquisitions or other growth investments.

The Company is also pleased to announce that it is actively exploring opportunities in the debt capital markets to further recapitalize and fortify its balance sheet in response to robust activity levels, and in anticipation of attractive acquisition opportunities that may materialize in the future.

Amar Doman, Chairman & CEO of CanWel, commented: "The combination of higher commodity pricing, volumes and overall business activity levels has provided record financial results for CanWel and we see that momentum continuing for the foreseeable future. The Company has never been in a stronger financial and operating position, as evidenced by our Q1 2021 results which were pre-released on April 19, 2021, and the significant cash flow generation and de-leveraging that has occurred over the past year. As such, management and the Board believe it is prudent to pursue these financing initiatives as we seek acquire, grow, and take CanWel to the next inflection point in its evolution as a leading North American building products company".

The offering is scheduled to close on or about May 11, 2021 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the Toronto Stock Exchange and the securities regulatory authorities.

The Common Shares will be offered by way of a short form prospectus to be filed in all of the provinces of Canada pursuant to National Instrument 44-101 Short Form Prospectus Distributions and in the United States on a private placement basis pursuant to an exemption from the registration requirements of the United States Securities Act of 1933, as amended.

This press release is not an offer or a solicitation of an offer of securities for sale in the United States. The Common Shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration.

About CanWel

Founded in 1989, CanWel is headquartered in Vancouver, British Columbia and trades on the Toronto Stock Exchange under the symbol CWX and is Canada's only fully integrated national distributor in the building materials and related products sector. CanWel operates: multiple treating plant and planing facilities in Canada and the United States; distribution centres coast-to coast in all major cities and strategic locations across Canada; in the United States near Portland, Oregon San Francisco and Los Angeles, California and in 14 locations in the State of Hawaii through its wholly owned Honsador Building Products Group. CanWel distributes a wide range of building materials, lumber, renovation and electrical products. In addition, through its CanWel Fibre division, CanWel operates a vertically integrated forest products company based in Western Canada, operating from British Columbia to Saskatchewan, also servicing the US Pacific Northwest. CanWel owns approximately 117,000 acres of private timberlands, strategic licenses and tenures, log harvesting and trucking operations, several post and pole peeling facilities and two pressure-treated specialty wood production plants and a specialty saw mill.

Certain statements in this press release may constitute "forward-looking" statements. When used in this press release, forward-looking statements often but not always, can be identified by the use of forward-looking words such as, including but not limited to, "may", "will", "would", "should", "expect", "believe", "plan", "intend", "anticipate", "predict", "remain", "estimate", "potential", "forecast", "budget", "schedule", "continue", "could", "might", "project", "targeting", "future" and other similar terminology or the negative or inverse of such words or terminology. Forward-looking information in this news release includes, without limitation, statements with respect to: the Offering, the use of proceeds therefrom and potential debt financing and acquisition opportunities. These forward-looking statements reflect the current expectations of CanWel's management regarding future events and operating performance, but involve other known and unknown or unpredictable risks, uncertainties and other factors which may cause the actual results, performance or achievements of CanWel. . Although CanWel believes that the expectations and the conditions reflected in such forward-looking statements are reasonable, CanWel can give no assurance that each of these conditions will be satisfied to the satisfaction of CanWel or that expectations will prove to be correct. By their nature, forward looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of additional risks and uncertainties affecting or that could affect CanWel, which could cause actual results and developments to differ materially from those described in, expressed or implied by these forward- looking statements Accordingly, readers should not place undue reliance on any forward-looking statements or information. There are numerous risks associated with an investment in CanWel's common shares or senior unsecured notes, which are also further described in the "Risk Factors" sections of CanWel's annual information form dated March 31, 2021 as well as its other public filings on SEDAR. These forward-looking statements speak only as of the date of this press release. We caution that the foregoing factors that may affect future results are not exhaustive. When relying on our forward-looking statements to make decisions with respect to CanWel, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Neither CanWel nor any of its associates or directors, officers, partners, affiliates, or advisers, provides any representation, assurance or guarantee that the occurrence of the events expressed or implied in any forward-looking statements in these communications will actually occur. You are cautioned not to place undue reliance on these forward looking statements. Except as required by applicable securities laws and legal or regulatory obligations, CanWel is not under any obligation, and expressly disclaims any intention or obligation, to update or revise any forward looking statements, whether as a result of new information, future events or otherwise.

SOURCE CanWel Bulding Materials Group Ltd.


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