NFI tumbles as Canadian bus maker raises $450M amid supply chain woes

NFI Group Inc. shares fell Tuesday after the Winnipeg-based bus maker announced a pair of financings that are designed to help it navigate global supply chain problems.

NFI Group Inc. shares fell Tuesday after the Winnipeg-based bus maker announced a pair of financings that are designed to help it navigate global supply chain problems.

In a release Tuesday morning, NFI said it upsized an offering of convertible debentures to $300 million from the originally planned $250 million. The company is also raising $150 million in a share sale priced at $24.55 apiece. The bought deal offerings are being underwritten by BMO Capital Markets, CIBC Capital Markets, National Bank Financial, and Scotiabank.

NFI also said its bankers have agreed to provide some flexibility on covenants tied to a US$1.25-billion senior credit facility.

Between the financings and that extra breathing room on its debt, NFI said it will have more flexibility to deal with supply chain disruptions, which the company said it views as being a "temporary phenomenon" that will persist into the first half of next year.

"[Monday's] financing will help us on that path as it strengthens our balance sheet and positions us for long-term success while providing financial flexibility to navigate near-term challenges from the pandemic and temporary supply chain disruptions," said NFI Chief Financial Officer Pipasu Soni in the release.

NFI's shares have tumbled into bear market territory since the end of August after shedding more than 20 per cent of their value as of Tuesday morning.