TORONTO, July 6, 2018 /CNW/ - Dealnet Capital Corp.
("Dealnet" or the "Company") (TSX VENTURE: DLS), announced today
that it has closed the previously announced sale of all of the
issued and outstanding shares of Impact Mobile Inc. ("Impact
Mobile"), to IMImobile Canada Inc., a wholly-owned subsidiary of
IMImobile PLC., for total cash consideration of $27.5 million.
Approximately $25 million of the
total consideration was paid on closing with the balance of the
purchase price due on January 6,
2019. Concurrent with the closing of the transaction,
holders of the Company's $12 million
of 6% senior secured debentures (the "Debentures") are being
notified that the Debentures will be redeemed in full on
July 9, 2018. The Company also
announced today that it has redeemed all 10,662 of the recently
issued 5% Series A Preferred Shares at their face value of
$25.00 per share. The net proceeds
from the sale of Impact Mobile, after retiring the senior secured
debentures and the Series A Preferred Shares, will be used to fund
the growth of the Company's consumer finance business.
"This transformational transaction adds capacity and flexibility
to our balance sheet, improves management's ability to focus on our
core business and puts the Company back in a position of strength
to accelerate the growth of our consumer finance business and
achieve profitability by the end of 2018," said Brent Houlden, Dealnet's President and CEO.
When the Company reports its third quarter financial results in
mid-November, it expects to post an after-tax gain of approximately
$24 million on the transaction which
will increase the Company's tangible net worth to approximately
$37 million and significantly reduce
its leverage ratio.
In conjunction with the repayment of the Debentures, the Company
also announces that pursuant to the terms of the common share
purchase warrants that were issued with the Debentures, an
accelerated expiry date of December 22,
2018 now applies for those applicable warrants.
About Dealnet Capital Corp.
Dealnet is a specialty finance company servicing the
$20 billion Canadian home improvement
finance market through both dealer-based and direct homeowner-based
originations of secured finance assets (equipment leases and
loans). The company earns net finance income over the term of these
assets and from fee income derived from the transaction support
services that it provides to its dealer network. The Company also
uses its live engagement platform, One Contact Communications, to
provide customer support services on a contract basis to
third-party institutions.
For additional information please visit www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
Forward-looking Statements
This news release contains certain "forward-looking information"
within the meaning of applicable securities law. Forward looking
information is frequently characterized by words such as "plan",
"expect", "project", "intend", "believe", "anticipate", "estimate",
"may", "will", "would", "potential", "proposed" and other similar
words, or statements that certain events or conditions "may" or
"will" occur. These statements are only predictions.
Forward-looking information is based on the opinions and estimates
of management at the date the information is provided and is
subject to a variety of risks and uncertainties and other factors
that could cause actual events or results to differ materially from
those projected in the forward-looking information. For a
description of the risks and uncertainties facing the Company and
its business and affairs, readers should refer to the Company's
Management's Discussion and Analysis. The Company undertakes no
obligation to update forward-looking information if circumstances
or management's estimates or opinions should change, unless
required by law. The reader is cautioned not to place undue
reliance on forward-looking information.
SOURCE Dealnet Capital Corp.