07:36 AM EDT, 08/08/2025 (MT Newswires) -- FLINT (FLNT.TO), which provides solutions for the Energy and Industrial markets, overnight Thursday announced a proposed recapitalization transaction that, it said, will "significantly reduce the company's debt and annual interest costs, simplify its capital structure and improve liquidity".

The company said that the recapitalization is the result of an "extensive review process" conducted by its board, which culminated in FLINT entering into a definitive recapitalization support agreement with its largest shareholder and primary lender, Canso Investment Counsel Ltd., in its capacity as portfolio manager for and on behalf of certain accounts that it manages.

The proposed recapitalization will be implemented by way of a plan of arrangement and as part of that, the company's 8.00% senior secured debentures due October 14, 2027, in the aggregate principal amount of around $135.3 million, together with all interest accrued from and after June 30, 2025, will be exchanged for the issuance of new common shares in the capital of the company, representing approximately 90% of the total number of common shares issued and outstanding upon completion of the recapitalization.

The total debt will be reduced by approximately $135.3 million and annual cash interest expense will be reduced by approximately $10.8 million.

The company also said that all of the issued and outstanding preferred shares will be exchanged for the issuance of new common shares representing approximately 7.5% of the total number of common shares issued and outstanding upon completion of the recapitalization.

A statement also noted that the common shares will be consolidated on a basis of one post-consolidation common share for every 40 pre-consolidated common shares.

The company added that existing common shareholders will retain their existing common shares, subject to the share consolidation, such that the common shareholders will own approximately 2.5% of the total number of common shares issued and outstanding upon completion of the recapitalization.

The number of common shares expected to be issued pursuant to the recapitalization, on a post-share consolidation basis, is around 107.2 million, approximately 97.5% of the total issued and outstanding common shares on a pre-closing non-diluted basis.

The company also agreed to enter into a registration rights agreement with Canso before the closing of the recapitalization, which will grant Canso certain registration rights in respect of future sales of common shares for so long as it beneficially controls at least 10% of the common shares.

In addition to the securityholder approvals, the recapitalization is subject to regulatory approvals, including the approval of the TSX, as well as the approval of the Court of King's Bench of Alberta and is expected to close by the end of September, subject to the satisfaction or waiver of customary closing conditions.

"With the continued support of Canso and our other stakeholders, we are well-positioned to accelerate our strategic objectives," said FLINT's Chief Executive Officer, Barry Card. "The Recapitalization enhances our ability to deliver our comprehensive service offerings, broaden our geographic reach, and further diversify our end markets. We are energized by the opportunities ahead and remain committed to creating long-term value for our shareholders and all stakeholders."