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Canadian Tire Corporation and CT REIT to Announce a Joint Secondary and Treasury Offering of CT REIT Units

November 19, 2018
  • CTC to monetize a 7.4% effective interest in CT REIT, through a $200 million secondary offering of CT REIT units
  • CT REIT to complete a $65 million treasury offering of CT REIT units to fund growth strategy
  • CTC remains committed to the strategic importance of its real estate portfolio and will retain an approximate 76.3% effective interest in CT REIT following the Offering
  • The Offering should enhance trading liquidity of CT REIT's units


TORONTO, Nov. 19, 2018 /CNW/ - CT Real Estate Investment Trust ("CT REIT") (TSX: CRT.UN) and certain subsidiaries of Canadian Tire Corporation, Limited (collectively, "Canadian Tire", "CTC" or the "Company") (TSX: CTC) (TSX: CTC.a) announced today that they have entered into an agreement with a syndicate of underwriters led by RBC Capital Markets and Scotiabank (the "Underwriters") pursuant to which the Underwriters will purchase, on a bought-deal basis, an aggregate of 21,115,000 units of CT REIT ("Units") at a price of $12.55 per Unit (the "Offering").  The Offering consists of a secondary offering of 15,936,000 units by CTC and a treasury offering of 5,179,000 units by CT REIT.  On closing of the Offering, CTC and CT REIT will receive gross proceeds of $200 million and $65 million, respectively.  The Offering is expected to close on or about November 28, 2018, and is subject to customary conditions, including the approval of the Toronto Stock Exchange. 

CTC and CT REIT have granted the Underwriters an over-allotment option to purchase up to an additional 2,788,000 units in the aggregate on the same terms and conditions, exercisable at any time, in whole or in part, for a period of 30 days following the closing of the Offering.  If the over-allotment option is exercised in full, the gross proceeds of the Offering to CTC and CT REIT will be $225 million and $75 million, respectively.

The net proceeds of the secondary offering will be used by CTC to support the continued investment in its owned brand strategy, including the recently completed acquisition of Helly Hansen, and for general corporate purposes.  The net proceeds of the treasury offering will be used by CT REIT to fund previously announced acquisitions and the ongoing development of certain of its existing properties.  Prior to the closing of these acquisitions and investment in development, the REIT will pay down amounts owing on its credit facility.

"The sale of an approximate 7.4% equity interest in CT REIT demonstrates our ample financial flexibility and is consistent with our capital allocation strategy," said Stephen Wetmore, President and CEO, Canadian Tire Corporation.  "Real estate continues to play an integral role in Canadian Tire's strategy and CT REIT provides an effective channel for our ongoing investment in this core asset.  Canadian Tire is very pleased with the performance of CT REIT since its IPO in 2013 and remains committed to the long term success of CT REIT."

"This sale of Units by CTC and CT REIT should enhance the trading liquidity of CT REIT's units, to the benefit of all unitholders," said Ken Silver, President and CEO, CT REIT.  "We look forward to continuing our strategic relationship with CTC and this Offering supports the execution of our proven growth strategy to generate value for all of our unitholders." 

Following the transaction, CTC will own an effective interest of approximately 76.3% in CT REIT (75.1% if the over-allotment option is fully exercised).  CTC intends to remain the majority unitholder of CT REIT over the long-term.

Canadian Tire will remain CT REIT's most significant tenant under long term leases, the majority of which contain annually escalating rental rates.  At September 30, 2018, CTC represented 94.5% of total gross leasable area and 92.7% of annualized base minimum rent.

The Units will be offered in all provinces and territories of Canada pursuant to CT REIT's base shelf prospectus, dated April 5, 2017, as supplemented by a prospectus supplement to be filed with the Canadian securities regulators in all of the provinces and territories of Canada.  The Units being offered have not been, and will not be, registered under the U.S. Securities Act of 1933 and state securities laws.


Canadian Tire Corporation, Limited, (TSX: CTC.A) (TSX: CTC) or "CTC", is a family of businesses that includes a Retail segment, a Financial Services division and CT REIT. Our retail business is led by Canadian Tire, which was founded in 1922 and provides Canadians with products for life in Canada across its Living, Playing, Fixing, Automotive and Seasonal & Gardening divisions. PartSource and Gas+ are key parts of the Canadian Tire network. The Retail segment also includes Mark's, a leading source for casual and industrial wear; Pro Hockey Life, the world's largest hockey centric retailer; and FGL (Sport Chek, Hockey Experts, Sports Experts, National Sports, Intersport and Atmosphere), which offers the best active wear brands. The more than 1,700 retail and gasoline outlets are supported and strengthened by our Financial Services division and the tens of thousands of people employed across Canada and around the world by the Company and its local dealers, franchisees and petroleum retailers. In addition, Canadian Tire Corporation owns and operates Helly Hansen, a leading global brand in sportswear and workwear based in Oslo, Norway. For more information, visit 


CT Real Estate Investment Trust (TSX:CRT.UN) or "CT REIT" is an unincorporated, closed-end real estate investment trust formed to own income producing commercial properties primarily located in Canada. Its portfolio comprises over 325 properties totaling approximately 26 million square feet of GLA, consisting primarily of retail properties located across Canada. Canadian Tire Corporation, Limited is CT REIT's most significant tenant. For more information, visit  


This press release contains forward-looking information within the meaning of applicable securities legislation, which reflects CT REIT's and CTC's current expectations regarding future events, including but not limited to the use of proceeds of the Offering, the date the Offering is expected to close, the trading liquidity of the Units, CTC's future intentions with respect to its CT REIT holdings and CTC remaining CT REIT's most significant tenant.  Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond CT REIT's and CTC's control, that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to, the factors discussed under "Risk Factors" in CT REIT's short form base shelf prospectus dated April 5, 2017, and the related prospectus supplement to be filed qualifying the distribution of the Units, each as amended or supplemented, and the documents incorporated by reference therein, all of which are available on CT REIT's website at and on SEDAR at CT REIT and CTC do not undertake any obligations to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable laws.


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