TORONTO, May 31, 2021 /CNW/ - Dye & Durham Limited
("Dye & Durham" or the "Company") (TSX: DND)
announced today that, following an indication of interest from a
shareholder group led by management to acquire the Company, its
board of directors has commenced a process
to explore and evaluate potential
strategic alternatives focused on maximizing
shareholder value. The indication of interest would result in Dye
& Durham being taken private at an approximate 23% premium to
the current market value, being a per share value of $50.50.
The strategic process will be led by a newly formed special
committee of independent directors, and is fully supported by the
Company's management team. The alternatives to be explored in
connection with the strategic process could include, among other
things, the sale of part or all
of the Company, a sale of
some of the assets of the
Company, a merger or other business
combination with another party, or other strategic
transactions.
The Company has not made any decisions related to any specific
strategic alternatives at this time and there can be no assurance
that the exploration of strategic alternatives will result in a
transaction. It is the Company's current intention not to
disclose developments with respect to the strategic process unless
and until the board of directors has approved a specific
transaction, on the recommendation of the special committee, or
otherwise determines that disclosure is necessary or
appropriate.
Corporate Update
As a result of its recent acquisitions and business performance,
the Company has updated its prior financial guidance and has
disclosed that it expects pro forma annualized Adjusted
EBITDA1 of approximately $220.0 million. This does not take into
account expected synergies from the Company's recent
acquisitions.
This financial guidance is being provided to enhance visibility
into the Company's expectations for financial targets. Please refer
to the section regarding forward-looking statements which forms an
integral part of this release.
1 Adjusted EBITDA is a non-IFRS measure. Please
see the Non-IFRS Financial Measures section of this press release
for more information. Pro forma annualized Adjusted EBITDA
is based on (a) current quarter forecasted Adjusted EBITDA of Dye
& Durham; and (b) full quarter forecasted adjusted EBITDA of
(i) the recent acquisitions of Future Climate Info Limited,
Terrafirma IDC Ltd., and certain other businesses acquired during
the current quarter, and (ii) GlobalX Information Pty Ltd., which
is expected to close in June 2021, on
an annualized basis.
About Dye & Durham
Dye & Durham Limited is a leading provider of cloud–based
software and technology solutions designed to improve efficiency
and increase productivity for legal and business professionals. Dye
& Durham provides critical information services and workflows,
which clients use to manage their process, information and
regulatory requirements. The Company has operations in Canada, the United
Kingdom, Ireland and
Australia, and has a strong
blue–chip customer base that includes law firms, financial service
institutions, and government organizations. Additional information
can be found at www.dyedurham.com.
Non-IFRS Financial Measures
Adjusted EBITDA is not defined by and does not have a
standardized meaning under International Financial Reporting
Standards ("IFRS") as issued by the International Accounting
Standards Board. This non-IFRS financial performance measure is
defined below. Non-IFRS financial measures are used by management
to assess the financial and operational performance of the Company.
The Company believes that this non-IFRS financial measure, in
addition to conventional measures prepared in accordance with IFRS,
enables investors to evaluate the Company's operating results,
underlying performance and prospects in a similar manner to the
Company's management. As there are no standardized methods of
calculating these non-IFRS measures, the Company's approaches may
differ from those used by others, and accordingly, the use of these
measures may not be directly comparable. Accordingly, this non-IFRS
measure is intended to provide additional information and should
not be considered in isolation or as a substitute for measures of
performance prepared in accordance with IFRS.
"EBITDA" means net income (loss) before amortization and
depreciation expenses, finance and interest costs, and provision
for income taxes.
"Adjusted EBITDA" adjusts EBITDA for stock-based compensation
expense, asset impairment charges, loss on settlement of loans and
borrowings, gains or losses from changes in fair value of
derivative financial instruments and contingent consideration
liabilities measured at fair value through profit or loss, specific
transaction related expenses related to acquisitions, the Company's
initial public offering and capital structure reorganization,
operational restructuring costs, restructuring costs includes
impact to the full year of cost synergies related to the reduction
of employees in relation to acquisitions.
Please refer to the Company's most recent management discussion
and analysis for further information on non-IFRS measures.
Forward-looking Statements
This press release may contain forward-looking information
within the meaning of applicable securities laws, which reflects
the Company's current expectations regarding future events,
including with respect to the Company being acquired or effecting a
strategic transaction, management engaging with the board of
directors to acquire the Company, and its financial outlook. In
some cases, but not necessarily in all cases, forward-looking
statements can be identified by the use of forward looking
terminology such as "plans", "targets", "expects" or "does not
expect", "is expected", "an opportunity exists", "is positioned",
"estimates", "intends", "assumes", "anticipates" or "does not
anticipate" or "believes", or variations of such words and phrases
or state that certain actions, events or results "may", "could",
"would", "might", "will" or "will be taken", "occur" or "be
achieved". In addition, any statements that refer to expectations,
projections or other characterizations of future events or
circumstances contain forward-looking statements. Forward-looking
statements are not historical facts, nor guarantees or assurances
of future performance but instead represent management's current
beliefs, expectations, estimates and projections regarding future
events and operating performance.
Specifically, Dye & Durham's forecast on pro forma
annualized Adjusted EBITDA is considered forward-looking
information. The foregoing demonstrates Dye & Durham's
objectives, which are not forecasts or estimates of its financial
position, but are based on the implementation of its strategic
goals, growth prospects and growth initiatives. Management's
assessments of, and outlook for, pro forma annualized
Adjusted EBITDA set out herein are generally based on the
following assumptions: (a) Dye & Durham's results of operations
will continue as expected, (b) the Company will continue
effectively execute against its key strategic growth priorities,
(c) the Company will continue to retain and grow its existing
customer base and market share, (d) the Company will be able to
take advantage of future prospects and opportunities, and continue
to realize on synergies, (e) there will be no changes in
legislative or regulatory matters that negatively impact Dye &
Durham's business, (f) current tax laws will remain in effect and
will not be materially changed, (g) economic conditions will remain
relatively stable throughout the period, (h) the industries Dye
& Durham operates in will continue to grow consistent with past
experience, and (i) the Company will acquire GlobalX Information
Pty Ltd. The Company considers these assumptions to be reasonable
in the circumstances, given the time period for such projections
and targets. The achievement of target revenue set out above is
subject to significant risks including, but not limited to: (a)
that the Company will be unable to effectively execute against its
key strategic growth priorities, (c) the acquisition of GlobalX
Information Pty Ltd. not occurring within the currently expected
timeline or at all, and (b) the Company will be unable to continue
to retain and grow its existing customer base and market share.
These estimates have been prepared by and are the responsibility of
management.
Forward-looking information is based on a number of assumptions
and is subject to a number of risks and uncertainties, many of
which are beyond the Company's control, which could cause actual
results and events to differ materially from those that are
disclosed in or implied by such forward-looking information. Such
risks and uncertainties include, but are not limited to, the
factors discussed under "Risk Factors" in the prospectus supplement
of the Company dated November 18,
2020 to the short-form base shelf prospectus (including the
documents incorporate therein) of the Company dated November 18, 2020. Dye & Durham does not
undertake any obligation to update such forward-looking
information, whether as a result of new information, future events
or otherwise, except as expressly required by applicable law.
SOURCE Dye & Durham Limited