Transactions unlock significant value from existing assets
"We are very pleased to have entered into this letter of intent with 35 Oak in relation to our pet food ingredients division, unlocking significant value for our shareholders and generating substantial capital to strengthen our balance sheet and prepare GFI for the next phase of growth," said
Under the Pet Food Transaction, GFI will transfer all of the assets and liabilities associated with its pet food ingredients division to a newly formed and wholly owned subsidiary ("Pet Food Co") and will sell a 49.9% equity stake in Pet Food Co to 35 Oak for approximately
Under the terms of the Loan, Pet Food Co will receive a revolving committed two-year credit facility of up to
In addition, the Company will enter into a management services agreement with the Pet Food Co, which will result in a minimum annual fee of
Under the Private Placement, GFI intends to offer units ("Units") of the Company at a price of
Under the letter of intent, 35 Oak has committed to purchase
The proceeds of the Transactions will be used for debt repayment, including approximately
The Transactions are anticipated to close in the second quarter of the Company's current fiscal year ending
The Pet Food Transaction and 35 Oak's participation in the Private Placement constitute "related party transactions" of GFI, within the meaning of Multilateral Instrument 61-101 – Protections of Minority Security Holders in Special Transactions ("MI 61-101") as 35 Oak is a shareholder of the Company. The Company determined that the Pet Food Transaction and 35 Oak's participation in the Private Placement are exempt from the formal valuation and minority approval requirements of MI 61-101 in reliance of the exemptions set forth in sections 5.5(e) and 5.7(1)(c) of MI 61-101, respectively, as the Pet Food Transaction and 35 Oak's participation in the Private Placement are supported by a control person of the Company in the circumstances described in section 5.5(e) of MI 61-101.
GFI is a fast-growing Canadian plant-based food and ingredients company, connecting the local farm to the global supply chain for peas, beans, lentils, chickpeas and other high protein specialty crops. GFI's vision is to become a vertically integrated farm-to-fork plant-based company providing traceable, locally sourced, healthy and sustainable food and ingredients. GFI is organized into four primary business lines: Core Ingredients, Value-Added Ingredients, Plant-Based Pet Food Ingredients and Downstream Products. Headquartered in
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This press release may contain certain forward-looking information and statements ("forward-looking information") within the meaning of applicable Canadian securities legislation, that are not based on historical fact. Forward-looking statements include without limitation statements containing the words "believes", "anticipates", "plans", "intends", "will", "should", "expects", "continue", "estimate", "forecasts" and other similar expressions. Forward-looking information in this press release includes without limitation statements relating to the Pet Food Transaction, the Loan, the Private Placement and 35 Oak's participation in the Private Placement, including the terms and conditions, closing date and impacts thereof. Readers are cautioned to not place undue reliance on forward-looking information. Actual results and developments may differ materially from those contemplated by these statements. GFI undertakes no obligation to comment on analyses, expectations or statements made by third-parties in respect of GFI, its securities, or financial or operating results (as applicable). Although GFI believes that the expectations reflected in forward-looking information in this press release are reasonable, such forward-looking information has been based on expectations, factors and assumptions concerning future events which may prove to be inaccurate and are subject to numerous risks and uncertainties, certain of which are beyond GFI's control, including the risk factors discussed in GFI's annual information form for the year ended
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