The Boyd Group has priced a Canadian private-placement offering at $525 million, the company announced.

The offering is tied to Boyd’s recently announced agreement to acquire 258 Joe Hudson’s collision centres located in the U.S. Southeast for US$1.3 billion. Boyd plans to use the net proceeds as a partial payment on the acquisition.

The offering includes senior unsecured notes priced at $1,000 per $1,000 principal amount of notes, with an interest rate of 5.5% payable semi-annually in arrears on November 6 and May 6, commencing on May 6.

If the proposed acquisition is not completed by April 29, or Boyd announces that it does not intend to proceed with it, the notes will be subjected to a special mandatory redemption for 100% of the principal plus accrued and unpaid interest.

The offering is being co-ordinated by an underwriters syndicate led by National Bank Capital Markets, TD Securities and RBC Capital Markets, as joint active bookrunners, and by CIBC Capital Markets, as joint passive bookrunner.

Winnipeg-based Boyd is attempting to buy the autobody shops through the proposed purchase of the entire Joe Hudson’s business, which generated US$722 million in sales and 8.7% adjusted EBITDA in the trailing 12-month period that ended June 30.

Boyd is also funding the acquisition through a combination of drawings on the company’s evolving credit facilities, proceeds from a concurrently US$780-million bought-deal IPO in the U.S.

The Joe Hudson’s portfolio spans 18 states. The chain has added 123 locations since 2020.

If all goes according to plan, the acquisition will expand Boyd’s location total to 1,273.

Photo: Joe Hudson’s