/NOT FOR DISTRIBUTION OR DISSEMINATION INTO
THE UNITED STATES OR THROUGH U.S.
NEWSWIRE SERVICES/
TORONTO, Dec. 23,
2022 /CNW/ - MCAN Mortgage Corporation d/b/a MCAN
Financial Group ("MCAN", the "Company" or "we") (TSX: MKP)
today announced the successful completion of its
previously announced rights offering (the "Rights Offering") to
eligible holders of its common shares (the "Common
Shares") which expired at 5:00
p.m. (Toronto time) on
December 20, 2022 (the "Expiry
Date"). The Rights Offering was oversubscribed by 1.75
times.
Upon closing of the Rights Offering, MCAN issued 2,450,407
Common Shares at a price of $14.00
per Common Share for aggregate gross proceeds of $34.3 million (1,826,553 Common Shares were
issued under the basic subscription privilege and 623,854 Common
Shares were issued under the additional subscription privilege).
Pursuant to the terms of the Rights Offering, each eligible
shareholder was entitled to subscribe for one Common Share for
every 13 rights (the "Rights") held by such shareholder.
Following the completion of the Rights Offering, MCAN has
34,305,704 Common Shares issued and outstanding. The Rights were
halted from trading on the Toronto Stock Exchange as of
12:00 p.m. (Toronto time) on the Expiry Date.
MCAN intends to use all of the proceeds less offering
expenses to fund the Company's mortgage lending and investment
business.
"We are very pleased with our capital raise. The proceeds
of this Rights Offering increases our asset capacity, which we will
use to take advantage of accretive opportunities that we see in our
construction and residential mortgage lending business and
investment business, in line with our risk appetite." said
Karen Weaver, President and Chief
Executive Officer. "We appreciate the continued strong support from
our existing shareholders, demonstrated by this successful
capital raise."
Details of the Rights Offering
were set out in a Notice and Circular,
which are available under the
Company's profile on SEDAR
at www.sedar.com.
The Rights and Common Shares issuable upon exercise of the
Rights have not been, and will not be, registered under the United
States Securities Act of 1933, as amended, and accordingly, the
Rights and the Common Shares were not publicly offered for sale in
the "United States" or to "U.S.
persons" (as such terms are defined in Regulation S under the
United States Securities Act of 1933, as amended). This press
release does not constitute an offer to sell or the solicitation of
an offer to buy the securities in any jurisdiction. There shall be
no sale of the securities in any jurisdiction in which an offer to
sell, a solicitation of an offer to buy or a sale would be
unlawful.
MCAN is a public company listed on the Toronto Stock Exchange
under the symbol MKP and is a reporting issuer in all provinces and
territories in Canada. MCAN also
qualifies as a mortgage investment corporation ("MIC") under the
Income Tax Act (Canada) (the "Tax
Act").
The Company's primary objective is to generate a reliable
stream of income by investing in a diversified portfolio of
Canadian mortgages, including residential, residential
construction, non-residential construction and commercial loans, as
well as other types of securities, loans and real estate
investments. MCAN employs leverage by issuing term deposits that
are eligible for Canada Deposit Insurance Corporation deposit
insurance that are sourced through a network of independent
financial agents. We manage our capital and asset balances based on
the regulations and limits of both the Tax Act and the Office of
the Superintendent of Financial Institutions.
As a MIC, we are entitled to deduct the dividends that we pay
to shareholders from our taxable income. Regular dividends
are treated as interest income to shareholders for income tax
purposes. We are also able to pay capital gains dividends,
which would be treated as capital gains to shareholders for income
tax purposes. Dividends paid to foreign investors may be subject to
withholding taxes. To meet the MIC criteria, 67% of our
non-consolidated assets measured on a tax basis are required to be
held in cash or cash equivalents and residential mortgages.
Our MCAN Home division operates through MCAN's wholly owned
subsidiary, XMC Mortgage Corporation, which has legally changed its
name effective April 1, 2022, to MCAN
Home Mortgage Corporation.
A Caution About Forward-looking
Information and Statements
This news release contains "forward-looking information" within
the meaning of applicable securities laws. Forward- looking
information can be identified by words such as: "expect", "intend,"
"plan," "seek," "believe," "estimate," "future," "likely," "may,"
"should," "will" and similar forward-looking language. The expected
use of the proceeds raised under the Rights Offering, including
MCAN's ability to deploy the proceeds on an accretive basis,
constitutes forward-looking information. The forward-looking
information contained in this news release is based on a number of
assumptions which we believe to be reasonable, including
assumptions relating to the investment opportunities that will be
available to MCAN in its core mortgage lending and investment
business and the expected use of proceeds from the Rights Offering.
Forward-looking information entails various risks and uncertainties
that could cause actual results to differ materially from those
expressed or implied in such forward-looking information. Risks
that could cause actual results to differ materially from those
expressed or implied in the forward-looking information contained
in this press release include, but are not limited to, that the
Company may not be able to find a suitable use of the proceeds of
the Rights Offering on an accretive basis. In addition, general
risks relating to capital markets, economic conditions, regulatory
changes, as well as the operations of our business may also cause
actual results to differ materially from those expressed or implied
in such forward-looking information. Forward-looking information is
not a guarantee of future performance, and management's assumptions
upon which such forward-looking information are based may prove to
be incorrect. Investors are cautioned not to place undue reliance
on any forward-looking information contained herein. The Company
disclaims any obligation to update or revise any forward-looking
information contained in this news release, whether as a result of
new information, future events or otherwise, except to the extent
required by law.
SOURCE MCAN Mortgage Corporation