Canam Group ending 33-year run as a public company

MONTREAL — Canam Group is preparing to end its 33-year run as a public company after partnering with a U.S. company and Quebec investors to take the structural steel specialist private.

After a few years of reflection, the leadership of the company, founded in 1960, concluded that the constraints of being public no longer fit with its vision.

Chief executive Marc Dutil said its shares are punished for weak contracts but rarely credited when most of its business runs smoothly.

"In recent years, the cyclical and risky nature of the company’s business is less and less what the markets are looking for," he said in an interview April 27.

Canam’s shares fell last summer after a $32-million provision was taken due to cost overruns from a U.S. project which resulted in the reorganization of its heavy metal structural activities. It also recently announced a review of its American bridges sector.

Under the proposal, American Industrial Partners (AIP) will control 60 per cent of the company and its board of directors. The Dutil family and Quebec’s Caisse de depot pension fund and Solidarity investment fund will increase their stake from 27.9 per cent now to 40 per cent.

The core shareholders are offering to buy up all the publicly traded shares for nearly double their recent price. Shareholders other than members of the Dutil family will be offered cash for their stock, subject to shareholder approvals.

The Dutil family will receive stock in the private company and vote in favour of the deal. In addition, the Caisse and the union investment fund are expected to roll over some or all of their stock.

The company — which has 23 plants across North America — says its head office will remain in Quebec.

Dutil said he expects AIP will remain involved for five to seven years. However, he ruled out a return to the stock market on the advice of company founder and chairman Marcel Dutil.

"My father always told me that his biggest mistake would have been to go public. We’ll remember that."

A special shareholder meeting is slated for June 30 to approve the transaction.