VANCOUVER, Aug. 7 /CNW/ - Methanex Corporation intends to offer to
purchase up to US$175 million worth of its common shares through a substantial
issuer bid. This represents 29,166,666 common shares or 17.9% of Methanex's
total issued and outstanding common shares, assuming Methanex purchases the
maximum number of shares under the substantial issuer bid. Methanex currently
has 162,501,266 common shares issued and outstanding. Methanex also intends to
make a normal course issuer bid under which it may repurchase up to 11,455,241
common shares of the Company representing not more than 10% of the "public
float" of the common shares.
Pierre Choquette, President and CEO of Methanex commented, "These planned
share repurchases are part of our commitment to return excess cash to
shareholders. Our low-cost production facilities and leading market position
combined with strong methanol pricing allowed us to generate almost US$400
million in cash from operations over the past year. Our cash balance is
currently in excess of US$450 million and we have an undrawn US$291 million
credit facility."
The substantial issuer bid offer will be made to all shareholders to
acquire common shares at a price in a range of US$6.00 to US$7.50 per share
through a procedure known as a "modified dutch auction". The modified dutch
auction allows shareholders to tender all or any portion of their common
shares to Methanex at any price within the range. The actual purchase price
paid by Methanex will be the price per share within the range that will allow
Methanex to purchase common shares having a total acquisition cost of up to
US$175 million. Subject to pro-rationing, all shareholders who tender their
common shares at a price equal to or lower than the actual purchase price will
receive the purchase price. All common shares tendered at a price higher than
the purchase price will be returned to the shareholders. Shares that are
purchased under the substantial issuer bid will be cancelled.
The substantial issuer bid offer is expected to expire at 6:00 p.m.,
Toronto time, on September 13, 2001, unless extended by Methanex. Full
particulars of the offer, including conditions of the offer and procedures for
the tendering of shares will be contained in an issuer bid circular that is
expected to be mailed to shareholders on August 8, 2001.
Methanex's notice of intention to make the normal course issuer bid was
filed and accepted by The Toronto Stock Exchange ("TSE") today. The bid will
be carried out through the facilities of the TSE. Purchases under the bid
will terminate on the earlier of August 9, 2002 and the date upon which
Methanex has acquired the maximum number of common shares permitted under the
bid or otherwise decides not to make further purchases. In accordance with
applicable securities laws, Methanex will not be making any purchases under
the normal course issuer bid until at least 20 business days after the expiry
or termination of the substantial issuer bid. Purchases under the normal
course issuer bid will be made from time to time at the then current market
price of the Company's common shares as traded on the TSE and the common
shares purchased will be cancelled. On August 1, 2000, Methanex commenced a
normal course issuer bid through the facilities of the TSE. Pursuant to that
bid, which was completed on December 7, 2000, Methanex acquired 12,515,532
common shares at an average price of Cdn.$7.35 per share.
NOVA Chemicals Corporation, which currently holds 28.9% of Methanex's
common shares, has indicated that it does not intend to tender any of its
shares to the substantial issuer bid or sell any of its shares during the
course of the normal course issuer bid. An independent committee of the Board
of Directors of Methanex was struck to examine the proposed bids and to make a
determination as to whether or not such bids would be in the best interest of
Methanex and its shareholders other than NOVA.
Methanex believes that purchasing its shares under the substantial and
normal course issuer bids is in the best interests of its shareholders and
represents an effective use of Methanex's financial resources. Methanex
intends to finance the purchase of common shares under the bids with cash on
hand.
CIBC World Markets Inc. will act as Dealer Manager under the substantial
issuer bid. Raymond James Ltd. has been appointed as broker to make purchases
under the normal course issuer bid.
Methanex is the world's largest producer and marketer of methanol.
Methanex shares are listed for trading on the Toronto Stock Exchange in Canada
under the trading symbol "MX" and on the Nasdaq National Market in the United
States under the trading symbol "MEOH." Methanex can be visited online at
www.methanex.com.
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For further information: Inquiries: Chris Cook, Manager, Investor
Relations, Phone: (604) 661-2600
To request a free copy of this organization's annual report, please go to
www.newswire.ca and click on reports@cnw.
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