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Press release from CNW Group

Bird Construction Inc. to Acquire H.J. O'Connell

Wednesday, July 20, 2011

Bird Construction Inc. to Acquire H.J. O'Connell20:30 EDT Wednesday, July 20, 2011/Not for distribution to United States newswire services or for distribution in the United States/ LISTING: TORONTO STOCK EXCHANGESYMBOL: BDTTORONTO, July 20, 2011 /CNW/ - Bird Construction Inc. ("Bird") (TSX: BDT) today announced that it has signed an agreement to acquire all of the outstanding shares of H.J. O'Connell, Limited ("H.J. O'Connell"). The purchase price for the acquisition will be approximately $77.5 million.The $77.5 million purchase price and related transaction expenses of $1.0 million will be funded with approximately $33.5 million of existing working capital, $30.0 million through equipment financing and $15.0 million by way of vendor take back financing. Bird has sufficient surplus working capital to satisfy the purchase price detailed above.The acquisition is expected to be completed on or about August 31, 2011, subject to the satisfaction of all usual and customary conditions to closing, including receipt of all necessary regulatory approvals, and approval under the Competition Act (Canada).H.J. O'Connell has been a leader in the heavy construction, civil construction and contract surface mining sectors since 1931 with operations in Newfoundland & Labrador, Northern Quebec and Manitoba. There is no geographic market sector overlap between the current operations of Bird and H.J. O'Connell. Its diversified business includes expertise serving the mining, energy, industrial, and infrastructure construction markets, with specialization in northern and remote site related projects. Certain key members of H.J. O'Connell's executive and management teams have agreed to remain as employees and to assist Bird in the management of H.J. O'Connell's ongoing growing operations. H.J. O'Connell operates a large fleet of heavy civil and mining equipment in support of its construction and mining operations. The equipment and expertise in earthwork and surface mining that H.J. O'Connell brings will permit Bird to expand its civil industrial business into new scopes of work. As well, Bird's recognized expertise in industrial building construction creates excellent opportunities to expand the services offered to H. J. O'Connell's loyal customer base."The H.J. O'Connell and Bird organizations are aligned in the most important aspects of our business models - our core values - safety, respect for employees, quality, integrity and sustainability in a manner that produces exceptional client satisfaction and highly attractive business results" said Brian LeMessurier, President of H.J. O'Connell, Limited. "We are pleased with our growth over the past number of years, but in order to continue with our strategy without placing undue pressure on our resources, we searched for a strategic partner. In Bird, I am pleased that we found a partner close to home."Bird and H.J. O'Connell believe that the combination of the two firms will enhance the services that they will be able to offer certain of their clients. The respective strengths that each firm's qualified employees possess will allow both organizations to capitalize on the anticipated growth in the markets they serve. H.J. O'Connell's 600 craft and staff employees will join the current 700 Bird employees when the transaction is completed."Bird has been considering various options to diversify its sources of revenue both geographically and through different market segments in order to grow the Company in a way that is similar to our manner of doing business" said Tim Talbott, President & C.E.O. of Bird. "In H.J. O'Connell, we believe we have clearly achieved these objectives and are excited about the growth opportunities that are ahead of the Company. We will be able to offer a broader range of services to particular clients within each of our operating areas, while providing interesting project opportunities for our valuable employees as the organization grows. We look forward to a long and strong relationship with the management and staff of H.J. O'Connell."In addition to enhanced growth prospects for the combined business of the two companies resulting from these synergies, the acquisition will make a significant immediate contribution to Bird's earnings and cash flows. H.J. O'Connell's unaudited earnings for its year ended May 31, 2011 were $13.8 million.A conference call for analysts and investors will be held at 10:00 AM EDT on Thursday, July 21, 2011 to present the particulars of the transaction to interested parties. The dial in number is 1-866-636-9090. Attendees are asked to be on the call 10 minutes prior to the start of the call. A transaction presentation that will form the basis of the call is available on Bird's website home page at www.bird.ca.This press release contains forward-looking statements that involve a number of risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. Many factors could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements.This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful. The securities have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.For further information: T.J. Talbott, President & C.E.O. or S.R. Entwistle, C.F.O. Bird Construction Inc. 5403 Eglinton Avenue West Toronto, ON M9C 5K6 Phone: (4l6) 620-7122 Fax: (416) 620-1516