Mortgage investment corporation expands equity funding in TD and CIBC-led deal
Alternative lender Firm Capital Mortgage Investment Corporation has agreed to sell its common shares in an expanded bought deal offering.
The transaction involves 1.95 million common shares priced at $11.30 each. The deal will be executed through a syndicate of underwriters, led by TD Securities Inc. and CIBC Capital Markets, and is expected to raise over $22 million in gross proceeds.
The agreement includes an over-allotment option, allowing the underwriters to purchase up to an additional 292,500 shares at the same price, potentially increasing the total proceeds to $25,340,250. The option can be exercised within 30 days following the closing of the offering.
The company, through its mortgage banker Firm Capital Corporation, plans to use the funds raised from the sale to repay existing debt and for general corporate purposes, according to its announcement.
The offering is expected to close around August 8, subject to regulatory approvals. The shares will be issued under a prospectus supplement to be filed by August 2, with securities regulatory authorities across Canada. This supplement will be filed under the Firm Capital’s short-form base shelf prospectus dated July 29.
Read more: Firm Capital files preliminary base shelf prospectus
Firm Capital Mortgage Investment Corporation operates as a non-bank lender. It provides residential and commercial short-term bridge and conventional real estate financing, including construction, mezzanine, and equity investments.
Firm Capital has not yet released its second-quarter financial report, but its subsidiary, Firm Capital Property Trust (FCPT), reported strong financial results for the first quarter of 2024.
FCPT nearly doubled its net income to $9.9 million, up from $5.4 million in the same period in 2023.
Firm Capital Property Trust owns and co-owns a diversified portfolio, including multi-residential, flex industrial, and net lease convenience retail properties. FCPT also participates in joint acquisitions with financial partners and purchases partial interests from existing ownership groups.
FCPT’s portfolio consists of 64 commercial properties totaling 2.5 million square feet of leasable area, along with 599 multi-residential units and 537 manufactured home units across Canada.
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