On May 27, 2005, Saskatchewan Wheat Pool Inc. closed the last stage of an extensive recapitalization and reorganization plan that completed its turnaround program and has given it one of the strongest balance sheets in the North American agricultural industry. Following these initiatives, the company has received a debt rating upgrade and re-inclusion in the S&P/TSX Composite Index.
Key elements of the recapitalization and reorganization plan included (1) the company’s continuance under the Canada Business Corporations Act and its transition from the provincial enabling legislation that originally created it as a cooperative appro-ximately 80 years ago; (2) the negotiated exchange of approximately $200 million of public notes into new common shares of the company following successful negotiations with leading noteholders and approval at a general meeting of noteholders; (3) a comprehensive refinancing of the company’s credit facilities, involving a $250 million asset-based working capital facility with a syndicate of lenders led by GE Capital and a $100 million senior secured term note issue with Amaranth LLC; (4) the consolidation of the company’s former dual class share structure into one class of common shares; and (5) a $150 million rights offering, the proceeds of which were used to eliminate $100 million of debt and for general orporate purposes. The initiatives required a series of transactions and approvals of shareholders, convertible noteholders, and former farmer delegates.
The company was represented in-house by Ray Dean, vice-president and general counsel/corporate secretary, and by Torys LLP, MacPherson Leslie & Tyerman LLP and Balfour Moss. The Torys team, who advised the company on all elements of the plan and led the implementation of the refinancing, included Tony DeMarinis, Peter Birkness, Jamie Scarlett, Don Roger, John Tobin, Dennis Mahony, Brad Cost, Dan Miller, Marni Halter, Marc Lavigne, Natasha De Cicco, Nadine Rockman, Victoria Blond, Mike Fox, John van Gent and Richard Johnson. MacPherson Leslie & Tyerman’s team, who led the implementation of the continuance, note exchange, share consolidation and rights offering, included Doug Ballou, Aaron Runge, Stathy Markatos, Todd Rosenberg and Bob Leurer, Q.C. Wayne Warren, Frank Mulock and Henry Brown of Gowling Lafleur Henderson LLP assisted with the continuance. Rick Van Beselaere and Stewart Berringer at Balfour Moss assisted with the refinancing.
GE Capital was represented by Blake, Cassels & Graydon LLP with a team that included Mike Harquail, Michael Burke, Valerie Legros, Silvana D’Alimonte and Iris Tam.
Amaranth LLC was represented by Fasken Martineau DuMoulin LLP with a team that included Jonathan Levin, Brian Wright, David Johnson and Kathleen Yoa.
The underwriters of the rights offering, led by BMO Nesbitt Burns, were represented by Osler, Hoskin & Harcourt LLP with a team that included Andrew Aziz, Doug Bryce and Jean Fraser.