TSX Accepts Notice of Intention to Make Normal Course Issuer Bid
09/11/2007 00:46
PR Newswire
AURORA, Canada, November 8 /PRNewswire/ -- Magna International Inc. (TSX: MG.A, NYSE: MGA) today announced that the
Toronto Stock Exchange ("TSX") had accepted its Notice of Intention to Make a
Normal Course Issuer Bid (the "Notice"). Pursuant to the Notice, we may
purchase for cancellation and/or for purposes of our long-term retention
(restricted stock) and restricted stock unit programs, up to 9,000,000 Magna
Class A Subordinate Voting Shares (the "Bid"), representing 9.9% of our
public float. As of November 6, 2007, we had 117,860,222 issued and
outstanding Class A Subordinate Voting Shares, including a public float of
90,558,994 Class A Subordinate Voting Shares.
As previously disclosed, the purpose of the Bid is:
- to attempt to offset any dilution arising from: (a) the issuance from
treasury on September 20, 2007 of 20 million of Class A Subordinate Voting
Shares pursuant to a statutory plan of arrangement involving Magna and OJSC
Russian Machines, to the extent such issuance was not offset by the 11.9
million Magna Class A Subordinate Voting Shares we purchased for cancellation
pursuant to a substantial issuer bid which was completed on September 25,
2007; and (b) the issuance from treasury from time to time of Class A
Subordinate Voting Shares on exercise of Magna stock options; and
- to fund our restricted stock awards, the redemption of restricted stock
units and our deferred profit sharing plans.
The Bid will commence on November 12, 2007 and will terminate no later
than November 11, 2008. All purchases of Class A Subordinate Voting Shares
will be made at the market price at the time of purchase in accordance with
the rules and policies of the TSX. Purchases may also be made on the New York
Stock Exchange ("NYSE") in compliance with Rule 10b-18 under the U.S.
Securities Exchange Act of 1934. Both the rules and policies of the TSX and
Rule 10b-18 contain restrictions on the number of shares that can be
purchased under the Bid, based on the average daily trading volumes of the
Class A Subordinate Voting Shares on the TSX and NYSE, respectively. As a
result of such restrictions, subject to certain exceptions for block
purchases, the maximum number of shares which can be purchased per day during
the Bid on the TSX is 91,737. Subject to certain exceptions for block
purchases, the maximum number of shares which can be purchased per day on the
NYSE will be 25% of the average daily trading volume for the four calendar
weeks preceding the date of purchase. Subject to regulatory requirements, the
actual number of Class A Subordinate Voting Shares and the timing of any
purchases will be determined by us having regard to future price movements
and other factors. The size of the Bid was adjusted from that disclosed on
November 6, 2007 to account for shares in our Canadian and U.S, deferred
profit sharing plans, which are excluded from the public float.
We are the most diversified automotive supplier in the world. We design,
develop and manufacture automotive systems, assemblies, modules and
components, and engineer and assemble complete vehicles, primarily for sale
to original equipment manufacturers of cars and light trucks in North
America, Europe, Asia, South America and Africa. Our capabilities include the
design, engineering, testing and manufacture of automotive interior systems;
seating systems; closure systems; metal body and chassis systems; vision
systems; electronic systems; exterior systems; powertrain systems; roof
systems; as well as complete vehicle engineering and assembly. We have
approximately 83,000 employees in 240 manufacturing operations and 62 product
development and engineering centres in 23 countries.
Forward-Looking Statements
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This press release may contain statements that, to the extent that they
are not recitations of historical fact, constitute "forward-looking
statements" within the meaning of applicable securities legislation.
Forward-looking statements may include financial and other projections, as
well as statements regarding our future plans, objectives or economic
performance, or the assumptions underlying any of the foregoing. We use words
such as "may", "would", "could", "will", "likely", "expect", "anticipate",
"believe", "intend", "plan", "forecast", "project", "estimate" and similar
expressions to identify forward-looking statements. Any such forward-looking
statements are based on assumptions and analyses made by us in light of our
experience and our perception of historical trends, current conditions and
expected future developments, as well as other factors we believe are
appropriate in the circumstances. However, whether actual results and
developments will conform with our expectations and predictions is subject to
a number of risks, assumptions and uncertainties. These risks, assumptions
and uncertainties include, without limitation, those related to the strategic
alliance with OJSC Russian Machines ("Russian Machines"), including: the risk
that the benefits, growth prospects and strategic objectives expected to be
realized from the investment by, and strategic alliance with, Russian
Machines may not be fully realized, realized at all or may take longer to
realize than expected; we will be governed by a board of directors on which
the Stronach Trust and Russian Machines each, indirectly, have the right to
designate an equal number of nominees, in addition to the current co-chief
executive officers, with the result that we may be considered to be
effectively controlled, indirectly, by the Stronach Trust and Russian
Machines for so long as the governance arrangements remain in place between
them; our Russian strategy involves making investments and carrying on
business and operations in Russia, which will expose us to the political,
economic and regulatory risks and uncertainties of that country; the
possibility that Russian Machines may exercise its right to withdraw its
investment and exit from the governance arrangements in connection with the
strategic alliance at any time after two years; the possibility that the
Stronach Trust may exercise its right to require Russian Machines to withdraw
its investment and exit from such arrangements at any time after three years;
and the possibility that Russian Machines' lender may require Russian
Machines to withdraw its investment and exit from such arrangements at any
time if such lender is entitled to realize on its loan to Russian Machines.
In addition to the risks, assumptions and uncertainties related to our
relationship with Russian Machines, there are additional risks and
uncertainties relating generally to us and our business and affairs,
including the impact of: declining production volumes and changes in consumer
demand for vehicles; a reduction in the production volumes of certain
vehicles, such as certain light trucks; the termination or non-renewal by our
customers of any material contracts; our ability to offset increases in the
cost of commodities, such as steel and resins, as well as energy prices;
fluctuations in relative currency values; our ability to offset price
concessions demanded by our customers; our dependence on outsourcing by our
customers; our ability to compete with suppliers with operations in low cost
countries; changes in our mix of earnings between jurisdictions with lower
tax rates and those with higher tax rates, as well as our ability to fully
benefit tax losses; other potential tax exposures; the financial distress of
some of our suppliers and customers; the inability of our customers to meet
their financial obligations to us; our ability to fully recover
pre-production expenses; warranty and recall costs; product liability claims
in excess of our insurance coverage; expenses related to the restructuring
and rationalization of some of our operations; impairment charges; our
ability to successfully identify, complete and integrate acquisitions; risks
associated with program launches; legal claims against us; risks of
conducting business in foreign countries; work stoppages and labour relations
disputes; changes in laws and governmental regulations; costs associated with
compliance with environmental laws and regulations; potential conflicts of
interest involving our indirect controlling shareholders, the Stronach Trust
and Russian Machines; and other factors set out in our Annual Information
Form filed with securities commissions in Canada and our annual report on
Form 40-F filed with the United States Securities and Exchange Commission,
and subsequent filings. In evaluating forward-looking statements, readers
should specifically consider the various factors which could cause actual
events or results to differ materially from those indicated by such
forward-looking statements. Unless otherwise required by applicable
securities laws, we do not intend, nor do we undertake any obligation, to
update or revise any forward-looking statements to reflect subsequent
information, events, results or circumstances or otherwise.
For further information: Vincent J. Galifi, Executive Vice-President and Chief Financial Officer of Magna at +1-905-726-7100