Carmanah Announces Agreement to Sell Assets to SPX Corporation

December 12, 2018
Send to a friend Share RSS Facebook Twitter


VICTORIA, BC, CANADA (December 12, 2018) Carmanah Technologies Corporation (TSX:CMH) (the “Company” or “Carmanah”), announced today that it has entered into a purchase agreement (the “Agreement”) regarding the sale of a significant portion of the assets of the Company to SPX Corporation (“SPX”) for USD $77.0 million.  The assets being sold include all of the issued and outstanding equity interests of each of Sabik Oy, Sabik Oü, Sabik PTE Ltd., and Sabik Ltd., and their respective assets (collectively, “Carmanah’s Marine business”), the business and assets the Company’s Airfield Ground Lighting business, its Aviation Obstruction Lighting business as well as some miscellaneous business assets that support the businesses to be sold (the “Transaction”).

“We are very pleased with this transaction”, said John Simmons, Chief Executive Officer of Carmanah. “Not only is it fairly valued but also creates numerous opportunities for employees and customers alike. Combining Carmanah’s Marine, Aviation and Airfield Ground Lighting products with SPX’s extensive infrastructure and broad distribution network is a great opportunity to further advance product development and extend the reach of these solutions to a broader customer base.”

The Transaction is anticipated to close in January 2019, subject to the satisfaction of certain customary commercial conditions, including but not limited to the Company obtaining the applicable regulatory approvals and approval by the Company’s shareholders of the sale of all or substantially all of the assets of the Company.  Shareholders of Carmanah representing approximately 33% of the voting shares of the Company, including all directors, have entered into voting and support agreements with SPX, pursuant to which they will agree to support and vote their shares in favour of the Transaction.

The Transaction has been approved unanimously by the Company’s board of directors (the “Board”), which has determined that the Transaction is in the best interests of the Company and its shareholders. Capital West Partners, an independent financial advisor to Board, has provided an opinion that, subject to the assumptions and limitations upon which the opinion is based, the consideration to be received by the Company is fair from a financial point of view. The Board recommends that shareholders vote in favor of approving the Transaction at a special meeting of shareholders, which is expected to be scheduled as soon as possible in early 2019 (the “Meeting”).

As the Transaction would constitute the sale of all or substantially all the assets as defined under the Business Corporations Act (British Columbia), the Transaction will require shareholder approval of at least 662/3% of shares voted in person or by proxy at the Meeting. In addition, if the Agreement is terminated by either party in certain circumstances, a break fee or expense reimbursement fee of USD $3.0 million or USD $2.0 million, will be payable by Carmanah to SPX.

The Company is preparing a management information circular (the “Circular”) for shareholders in respect of the Meeting that will further explain the terms and conditions of the Transaction.  The Company anticipates mailing the Circular as soon as possible.  Copies of the Agreement and the Circular will be filed with Canadian securities regulators and will be available on the SEDAR profile of Carmanah at

The net cash proceeds of the Transaction after transaction costs and taxes is estimated to be approximately USD $73.5 million that, together with Company projected cash balances approximately USD $15.0 million, will result in total cash reserves of approximately USD $88.5 million.  Company management and the Board have yet to fully consider how the Company will use the proceeds from the Transaction.  Alternatives under consideration will include investments to grow the residual businesses of the Company by way of acquisitions or research and development spending, acquisitions of other businesses in new market spaces or returning cash to the shareholders by way of dividends or share buy-backs.

After the effect of the transaction, the Company will retain 4 operating divisions: (i) Carmanah Traffic, which develops and sells traffic signaling devices including crosswalk and school zone warning systems, LED enhanced traffic signs, radar speed signs and miscellaneous traffic warning products; (ii) Sol, Inc., which develops and sells solar powered outdoor lighting for streets, parking lots and pathways; (iii) Carmanah Telematics, which designed, built and supplies solar powered, satellite connected asset tracking devices to its customer, a satellite operating company; and (iv) Sabik Offshore GmbH, which provides completely integrated safety and marking solutions from aids to navigation to aviation obstruction lighting for offshore wind farms (collectively the “Residual Businesses”). The Residual Businesses generated revenues in excess of USD $30.0 million in the trailing 12 months and are expected to generate similar revenues and positive Adjusted EBITDA in 2019.

About Carmanah Technologies Corporation


Carmanah designs, develops, and distributes a portfolio of products focused on energy optimized LED solutions for infrastructure.  Since 1996, we have earned a global reputation for delivering durable, dependable, efficient, and cost-effective solutions for industrial applications that perform in some of the world’s harshest environments.  We manage our business within two reportable segments: Signals and Illumination.  The Signals segment serves the Airfield Ground Lighting, Aviation Obstruction, Offshore Wind, Marine, Traffic, and Telematics markets.  The Illumination segment provides solar-powered LED outdoor lights for municipal and commercial customers.


About SPX Corporation

SPX Corporation is a supplier of highly engineered products and technologies, holding leadership positions in the HVAC, detection and measurement, and engineered solutions markets. Based in Charlotte, North Carolina, SPX Corporation had approximately $1.4 billion in annual revenue in 2017 and more than 5,000 employees in about 14 countries. SPX Corporation is listed on the New York Stock Exchange under the ticker symbol “SPXC.”  For more information, please visit


This release may contain “forward-looking information” and “forward-looking statements” within the meaning of applicable Canadian securities legislation.  All information contained herein that is not historical in nature may constitute forward-looking information.  Often, but not always, forward-looking statements can be identified by the use of words such as “expects”, “estimates”, “could”, “will”, or variations of such words and phrases.  Forward-looking statements herein include, but are not limited to, statements regarding the sale of substantially all of Carmanah’s assets, the consideration to be paid under the Agreement, the closing of the Transaction, calling a special meeting of shareholders, the contents and expected timing of mailing the Circular, the expected date of the special meeting of shareholders, the anticipated closing date of the Transaction, the satisfaction of closing conditions, including obtaining the requisite regulatory and shareholder approvals, use of proceeds from the Transaction, estimated revenues for the Residual Businesses in the trailing 12-months, value and opportunities for Carmanah customers and employees, product development and reach for Marine, Aviation and Airfield Ground Lighting Products, and are based on management’s current expectations and assumptions that, while considered reasonable by management, are inherently subject to business, market and economic risks, uncertainties, and contingencies which may cause the actual results, performance, or achievements of Carmanah to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements.

These forward-looking statements are based on management’s current expectations and beliefs but given the uncertainties, assumptions and risks, readers are cautioned not to place undue reliance on such forward-looking statements or information. Carmanah disclaims any obligation to update, or to publicly announce, any such statements, events or developments except as required by law. Risk factors include, among others: risks related to certain conditions contemplated by the Agreement.

For additional information on these risks and uncertainties, see Carmanah’s most recently filed Annual Information Form (“AIF”) and Annual MD&A (“MD&A”), which are available on SEDAR at and on the Company’s website at  The risk factors identified in the AIF and MD&A are not intended to represent a complete list of factors that could affect Carmanah. Accordingly, readers should not place undue reliance on forward-looking statements.  Carmanah does not assume any obligation to update the forward-looking information contained in this press release, unless required by law.