Press release from CNW Group
H�roux-Devtek announces conditional acquisition of Eagle Tool & Machine Co.
Thursday, April 08, 2010
H�roux-Devtek announces conditional acquisition of Eagle Tool & Machine Co.11:27 EDT Thursday, April 08, 2010Strategic acquisition adds landing gear manufacturing capacity in the U.S., broadens product portfolio and strengthens customer relationshipsLONGUEUIL, QC, April 8 /CNW Telbec/ - H�roux-Devtek Inc. (TSX: HRX) a leading Canadian manufacturer of aerospace and industrial products, today announced the conditional acquisition of substantially all the net assets of Eagle Tool & Machine Co. ("Eagle Tool") and of its subsidiary E-2 Precision Products ("E-2"), two privately-owned manufacturers of precision machined components for the aerospace industry. Eagle Tool and E-2 are located in Springfield and Cleveland, Ohio, respectively, and have a workforce of approximately 180 employees. The acquisition is subject to H�roux-Devtek's Board of Directors approval and customary closing conditions.For the year ended December 31, 2009, Eagle Tool generated sales of approximately US$38 million and its year-end funded backlog was roughly US$125 million. The value of net assets to be acquired is approximately US$34 million, subject to post closing adjustments. Financing for the transaction has been secured through the Company's available cash and existing credit facilities. The transaction should close before the end of April and is expected to be accretive to earnings per share by up to 10% in the first year following the acquisition.Founded in 1939, Eagle Tool principally manufactures OEM (Original Equipment Manufacturer) and aftermarket complex landing gear components mainly for the military aerospace industry and also for certain commercial aerospace programs. It is mainly involved in the production of components for the C-5, C-17, C-130, F-15, F-18 and T-38 programs, while also participating in the F-35 Joint Strike Fighter program."Eagle Tool is a very strategic acquisition for H�roux-Devtek, as it will further strengthen relationships with our main military customers, broaden our product portfolio and yield synergies," said Gilles Labb�, President and Chief Executive Officer of H�roux-Devtek. "We are pleased to welcome Eagle Tool's dedicated employees whose quality products and services have earned the firm a solid reputation with leading OEMs, the U.S. Air Force and the U.S. Navy. This transaction solidifies our position in the landing gear market by establishing a U.S. manufacturing base closer to our main customers and reaffirms H�roux-Devtek's status as the third largest landing gear manufacturer in the world."Bill Brougher, President of Eagle Tool and E-2, added: "The possibility for Eagle Tool and E-2 to join H�roux-Devtek is very appealing to our companies. H�roux-Devtek's widely-recognized depth and expertise, combined with our manufacturing capabilities, will broaden the products and services we can offer to our valuable customers."ProfileH�roux-Devtek (TSX: HRX), a Canadian company, serves two main market segments: Aerospace and Industrial Products, specializing in the design, development, manufacture and repair and overhaul of related systems and components. H�roux-Devtek supplies both the commercial and military sectors of the Aerospace segment with landing gear systems (including spare parts, repair and overhaul services) and airframe structural components. The Company also supplies the industrial segment with large components for power generation equipment and precision components for other industrial applications. Approximately 65% of the Company's sales are outside Canada, mainly in the United States. The Company's head office is located in Longueuil, Qu�bec with facilities in the Greater Montreal area (Longueuil, Dorval, Laval and Rivi�re-des-Prairies); Kitchener and Toronto, Ontario; Arlington, Texas and Cincinnati, Ohio.Forward-Looking StatementsExcept for historical information provided herein, this press release may contain information and statements of a forward-looking nature concerning the future performance of the Company. These statements are based on suppositions and uncertainties as well as on management's best possible evaluation of future events. Such factors may include, without excluding other considerations, fluctuations in quarterly results, evolution in customer demand for the Company's products and services, the impact of price pressures exerted by competitors, and general market trends or economic changes. As a result, readers are advised that actual results may differ from expected results.For further information: H�roux-Devtek Inc.: Gilles Labb�, President and Chief Executive Officer, (450) 679-3330; MaisonBrison: Martin Goulet, CFA, (514) 731-0000