19th Aug 2008 07:00
Aggreko plc to acquire Canadian Power Rental Business
Aggreko plc, the global leader in the provision of temporary power, temperature control and oil-free compressed air solutions, announces today that it has agreed to acquire substantially all the assets of Power Plus Rentals and Sales Ltd and companies associated with it ("Power Plus"). The maximum consideration, payable in cash, is CN$38.7 million (£19.5m), comprising a fixed element of CN$31 million (£15.6m), and further payments of up to a maximum of CN$7.7 million (£3.9m) dependent on financial performance over the next three years. The consideration will be funded from Aggreko's existing banking facilities.
Power Plus, based in Edmonton, provides specialist power rental solutions to businesses in the Athabasca Oil Sands in Alberta and Saskatchewan. Over the past three years, Power Plus has grown revenues at a compound rate of over 35%, and in the year ended 31 July 2008 had unaudited revenues of CN$10.6 million (£5.4m) and earnings before interest and tax (EBIT) of CN$5.1 million (£2.6m). The value of net assets that will be acquired as stated in the vendor's books at 31 July 2008 is CN$11.0 million (£5.6m).
Key points
Consistent with Aggreko's strategy of growing its core business in power and temperature control by fleet investment, geographic expansion and carefully-selected acquisitions
Gives Aggreko a leading position in an increasingly important part of the Oil & Gas market
Extends Aggreko's expertise in designing equipment for, and operating in, extremely cold environments
Reinforces Aggreko's ability to serve Oil & Gas customers on a global basis
Strengthens Aggreko's position in Canada, where it already has service centres in Sarnia, Toronto and Edmonton. In May 2008, Aggreko was made Official Supplier of Power and Temperature Control for the 2010 Winter Olympic Games in Vancouver.
As set out in our strategy update to investors in March 2008, Aggreko is determined to have a strong presence in markets where demand for its services is likely to be growing rapidly. One such market is the Athabasca Oil Sands in Alberta and Saskatchewan, where over CN$10 billion a year is being invested by the oil majors and others in the development of the world's second-largest proven oil reserve. In pursuit of a strategy to establish a position in this market, Aggreko opened a small depot in Edmonton in 2007.
Rupert Soames, Chief Executive of Aggreko, said: "We are delighted to be acquiring this fast-growing and highly specialized business in what is a very promising market for Aggreko. We look forward to welcoming our new colleagues from Power Plus into Aggreko, and growing our ability to serve customers in the Oil Sands area."
Enquiries
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Aggreko plc |
+44 141 225 5900 |
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Rupert Soames, Chief Executive |
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Angus Cockburn, Finance Director |
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Maitland |
+44 20 7379 5151 |
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Neil Bennett |
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Charlotte Walsh |
Notes:
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1. |
As part of this transaction, Aggreko will acquire substantially all the assets of three companies which are associated with each other. They are: Power Plus Rentals and Sales Ltd, and Power Lease Ltd, both of which are incorporated in Alberta, and Power House Rentals Ltd, incorporated in Saskatchewan. |
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2. |
Exchange rate used GBP = CAD 1.98 |
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3. |
EBIT is stated before management fees charged to the business by the Vendors. |
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