BRANTFORD, ONTARIO -- (Marketwire) -- 09/14/12 -- Wescast Industries Inc. (TSX: WCS.A) ("Wescast") today announced that, in connection with its previously-announced acquisition by Sichuan Bohong Industry Co., Ltd. ("Bohong") of China, Bohong has advised Wescast that Bohong has received a necessary People's Republic of China approval, being the approval of the National Development and Reform Commission ("NDRC"). The approval of the NDRC is required for any transaction related to foreign investment outside the People's Republic of China.
As disclosed in Wescast's June 1, 2012 press release, Bohong requires debt financing from the China Development Bank in order to complete the acquisition. The approval of the NDRC is required in order for the China Development Bank to provide financing for the acquisition. As disclosed in Wescast's August 31, 2012 press release, Bohong has until November 30, 2012 to receive certain other approvals, provide Wescast with definitive financing documents with China Development Bank and waive its closing financing condition. In order for the acquisition to be completed, all closing conditions, including receipt of certain other approvals of the People's Republic of China, will need to be satisfied or waived.
Wescast and Bohong have also entered into an amending agreement to the arrangement agreement for the acquisition to provide that, upon the closing of the acquisition, Bohong, through its wholly-owned subsidiary, Taixing International Investment Limited, will loan to Wescast $35 million to enable Wescast to repay its outstanding debt and for other corporate purposes.
Wescast does not intend to provide any further update about the proposed acquisition until the earlier of (i) Wescast being provided with Bohong's definitive financing documents with China Development Bank and confirmation that Bohong has waived its closing financing condition and (ii) December 1, 2012, or until it otherwise determines that further disclosure is appropriate or required.
Wescast Industries Inc. is the world's leading supplier of cast exhaust manifolds for passenger cars and light trucks. In addition to other products, Wescast designs, casts, machines and assembles exhaust system components, primarily exhaust manifolds, turbo charger housings and integrated turbomanifolds for automotive original equipment manufacturers ("OEMs") and Tier 1 customers for the car and light truck markets in North America, Europe, Asia, Africa, South America and Australia. Wescast employs approximately 2,100 people in 7 production facilities and 5 sales and design centres in Canada, Hungary, the United States, Germany, Japan and China. Wescast also has sales and technical design representation in the United Kingdom and France. Wescast is recognized worldwide for its quality products, innovative design solutions and highly committed workforce.
Learn more at www.wescast.com.
Forward Looking Statements
The contents of this news release contain statements which, to the extent that they are not recitations of historical fact, may constitute forward-looking statements based on certain assumptions. Forward-looking statements are provided for the purpose of providing information about Wescast's current expectations and plans relating to the proposed acquisition. Persons reading this news release are cautioned that such information may not be appropriate for other purposes. Such forward-looking statements include the statements regarding the proposed acquisition, Bohong's financing, and receipt of definitive debt documents. The words "may", "would", "could", "will", "likely", "expect", "anticipate", "estimate", "intend", "plan", "forecast", "project" and "believe" or other similar words and phrases are intended to identify forward-looking statements.
This information is based upon certain material factors or assumptions that were applied in drawing a conclusion or making a forecast or projection as reflected in the forward looking statements, including the ability of Bohong to obtain the necessary financing, China Development Bank provide the financing, Bohong obtaining other necessary People's Republic of China approvals and the closing of the proposed acquisition.
Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results to differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties principally relate to the risks associated with the proposed acquisition include, but are not limited to: the failure of Bohong to obtain the necessary financing commitment and financing, Bohong's lack of sufficient resources to complete the proposed acquisition in the absence of such financing, Wescast's lack of recourse against China Development Bank, or any other lender to Bohong, should such lender fail to provide the required financing assuming Bohong is able to secure financing commitments, the possibility that any conditions to closing of the proposed acquisition under the arrangement agreement, including regulatory (including any approvals required in the People's Republic of China), shareholder and/or court approvals, may not be satisfied or waived, Bohong's assets and management being located outside of Canada limiting the practical ability of Wescast to enforce its legal rights under the Agreement, including any judgement obtained in a Canadian court, against Bohong.
Wescast does not undertake any obligation to update or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect the occurrence of unanticipated events, except as required by law.
Wescast Industries Inc.
Edward G. Frackowiak
Chairman and CEO