CGI Announces Successful C$750 Million Private Note Offering
CGI Announces Successful C$750 Million Private Note Offering
CGI (TSX: GIB.A) (NYSE: GIB) has made headlines with its recent announcement regarding a private offering of senior unsecured notes. The total amount raised in this offering is a considerable C$750 million, specifically designated for financing operations and addressing current financial obligations.
Details of the Offering
The offering of notes consists of two distinct series, which break down to C$300 million in 3-year notes and C$450 million in 5-year notes. These notes are particularly interesting as they come with competitive interest rates; the 3-year notes will yield an interest of 3.987% per annum, while the 5-year notes will offer a slightly higher rate of 4.147% per annum. This financial maneuver is poised to close under standard conditions in the near future.
Utilization of Proceeds
The net proceeds from this offering are projected to be around C$746.1 million once fees and other expenses are subtracted. CGI has outlined clear intentions for utilizing these funds, primarily focusing on repaying existing debts and pursuing general corporate endeavors. Notably, a significant portion of the existing debt comprises US$350 million in senior unsecured notes due shortly.
Process and Regulatory Compliance
These notes will be marketed on a private placement basis, adhering to local regulations within Canada. Notably, a group of reputable financial institutions, including BMO Nesbitt Burns Inc., CIBC World Markets Inc., Scotia Capital Inc., Desjardins Securities Inc., and TD Securities Inc., will manage the offering. CGI emphasizes its compliance with applicable securities laws to ensure a smooth issuance process.
About CGI
Established in 1976, CGI has grown to be one of the major independent IT and business consulting firms globally. With a workforce of approximately 90,000 professionals spread across various regions, CGI provides comprehensive services that range from strategic IT solutions to business process services. The company's proficiency in enabling businesses to digitally transform and achieve operational effectiveness is well-regarded in multiple sectors.
CGI's revenue for the fiscal year 2023 was reported at $14.30 billion, showcasing the company's robust market position. Shares in CGI are traded both on the TSX (GIB.A) and the NYSE (GIB), solidifying its status in the financial markets.
Frequently Asked Questions
1. What is the total amount raised in CGI's recent offering?
CGI successfully raised a total of C$750 million through its offering of senior unsecured notes.
2. What are the interest rates for the notes offered?
The 3-year notes carry an interest rate of 3.987%, while the 5-year notes have an interest rate of 4.147%.
3. How will CGI use the proceeds from this offering?
The proceeds will primarily be used to repay existing indebtedness and fund general corporate purposes.
4. Which financial institutions are involved in the note offering?
A syndicate led by BMO Nesbitt Burns Inc., CIBC World Markets Inc., Scotia Capital Inc., Desjardins Securities Inc., and TD Securities Inc. is managing the private placement.
5. When is the expected closure date of the offering?
The offering is anticipated to close on or about September 5, 2024, subject to customary conditions.
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