IBI Group Inc. announces rights offering

• Rights offering to raise maximum proceeds of $9,133,000

TORONTO, Nov. 10, 2015 /PRNewswire/ - IBI Group Inc. ("IBI" or the "Company") (TSX: IBG) today announced that the Company will be offering each shareholder of its common shares (the "Common Shares") the right to subscribe for additional Common Shares of IBI (a "Right"). The record date for establishing the shareholders entitled to receive the Rights will be 5:00 p.m. (Toronto time) on November 19, 2015 (the "Record Date").

Four Rights will entitle a shareholder to subscribe for one Common Share upon payment of the subscription price of $1.60 per Common Share. The subscription price of $1.60 per Common Share is equal to a discount of approximately 22.7% from the volume weighted average trading price of Common Shares on the Toronto Stock Exchange ("TSX") for the 5 day period ending on November 9, 2015. The Rights will be listed on TSX.

Shareholders who fully exercise their Rights are entitled to subscribe pro rata for additional Common Shares, if available as a result of unexercised Rights prior to the Expiry Time.

IBI Group Management Partnership and its affiliated partnerships, which hold 3,860,206 Common Shares, have agreed to provide a standby commitment under which they have agreed to exercise their Rights received as shareholders and to subscribe for additional Common Shares available as a result of unexercised Rights, subject to a limit such that their ownership of Common Shares represents an ownership interest of less than 50% in the Company (on a partially diluted basis, assuming the exchange of Class B Units of IBI Group partnership for Common Shares).

There are currently 17,808,484 Common Shares outstanding, so that if all of the Rights were fully exercised, the Rights offering would raise net proceeds of $6,723,000 (after deducting estimated expenses relating to the Rights offering). The net proceeds will be used to repay indebtedness.

The rights will expire at 5:00 p.m. (Toronto time) on December 18, 2015 (the "Expiry Time"), after which time unexercised Rights will be void and of no value. If a shareholder does not exercise the Rights and the Rights offering is completed, such shareholder's percentage interest in the Company will be diluted upon the exercise of Rights by other shareholders. 

Details of the Rights offering will be set out in a circular that will be mailed to shareholders and will be available under IBI's SEDAR profile at www.sedar.com.

IBI Group partnership, the partnership through which the business of IBI is conducted, will concurrently with the Rights offering, issue to IBI Group Management Partnership (the holder of all of the 5,025,778 issued and outstanding Class B Units of IBI Group), rights to subscribe for up to an additional 1,256,444 Class B Units, which are exchangeable for Common Shares, on terms substantially similar to those of the Rights offering. The subscription price will be paid by a promissory note which will be set off against the corresponding amount of indebtedness owing by IBI Group to IBI Group Management Partnership, and will result in further debt reduction of approximately $2,010,000.

In addition, it is proposed that a portion of the remaining IBI Group indebtedness to IBI Group Management Partnership be used to satisfy the subscription price for additional Common Shares and/or Class B Units to be subscribed for by IBI Group Management Partnership pursuant to a private placement, subject to a limit such that it will hold an ownership interest of less than 50% in the Company (on a partially diluted basis, assuming the exchange of Class B Units for Common Shares).

Caution Regarding Forward-Looking Information

Statements in this news release that describe the Company's or management's expectations, forecasts, guidance or estimates may constitute "forward-looking" statements, and such statements use words such as "may", "will", "expect", "believe", "plan" and other similar terminology. Forward-looking statements also include statements that are not historical facts. Forward-looking statements reflect management's current expectations regarding future events and operating performance and speak only as of the date of this news release. Forward looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, IBI Group, or the industry in which they operate, to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, such statements are not guarantees of future performance and actual results or developments may differ materially from those in forward-looking statements. Forward-looking statements involve a number of risks and uncertainties, including those related to: (i) IBI's ability to maintain profitability and manage its growth; (ii) IBI's reliance on its key professionals; (iii) competition in the industry in which IBI operates; (iv) timely completion by IBI of projects and performance by IBI of its obligations; (v) fixed-price contracts; (vi) the general state of the economy; (vii) acquisitions by IBI; (viii) risk of future legal proceedings against IBI; (ix) the international operations of IBI; * reduction in IBI's backlog; (xi) fluctuations in interest rates; (xii) fluctuations in currency exchange rates; (xiii) potential undisclosed liabilities associated with acquisitions; (xiv) upfront risk for time invested in participating in consortiums bidding on large projects; (xv) limits under IBI's insurance policies; (xvi) the Company's reliance on distributions from IBI Group LP and IBI Group and, as a result, its susceptibility to fluctuations in IBI's performance; (xvii) unpredictability and volatility of the price of the Company's shares; (xviii) the degree to which IBI is leveraged; (xix) the possibility that the Company may issue additional shares diluting existing shareholders' interests; and (xx) income tax matters. See "Risk Factors" discussed in the Company's Annual Information Form filed with the Canadian securities regulatory authorities. New risk factors may arise from time to time and it is not possible for management of the Company to predict all of those risk factors or the extent to which any factor or combination of factors may cause actual results, performance or achievements of the Company to be materially different from those contained in forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. Although the forward-looking statements contained in this news release are based upon what management believes to be reasonable assumptions, the Company cannot assure investors that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this news release.

About IBI Group Inc.

IBI Group (TSX:IBG) is a globally integrated architecture, planning, engineering, and technology firm with over 2,200 professionals around the world. For more than 40 years, its dedicated professionals have helped clients create livable, sustainable, and advanced urban environments. IBI Group believes that cities must be designed with intelligent systems, sustainable buildings, efficient infrastructure, and a human touch.

SOURCE IBI Group Inc.

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