Press release from Marketwire
Bri-Chem Announces Letter of Intent to Acquire USA Based Speciality Cement Blending Business
Tuesday, April 30, 2013
Bri-Chem Announces Letter of Intent to Acquire USA Based Speciality Cement Blending Business07:00 EDT Tuesday, April 30, 2013
EDMONTON, ALBERTA--(Marketwired - April 30, 2013) -
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Bri-Chem Corp. ("Bri-Chem" or "Company") (TSX:BRY) a leading North American wholesale distributor and manufacturer of oil and gas drilling fluids and steel pipe is pleased to announce that it has entered into a letter of intent (the "Letter of Intent") to acquire the assets and ongoing operations of a California, USA based speciality cement chemical blending and packaging company (the "Cementco"). Under the terms of the Letter of Intent, Bri-Chem has agreed to purchase certain assets of Cementco including the land and building assets related to its operation which includes a transloading facility that provides a six car rail spur for bulk purchasing and shipping of materials. The transaction, the terms of which are confidential, is expected to be completed on or about May 31, 2013, subject to certain closing conditions.
Cementco, founded in 2001, generates revenues of approximately $7MM and has experienced solid growth annually over the past 11 years. They are the only local source for sales of oil well related blended bulk materials such as specialty cement, commodity products and other chemicals to oil well contractors operating predominantly in southern and central California within the Monterey Santos Shale. One of Cementco's strategic advantages is having the bulk capacity for materials and providing custom blending, bagging, and transportation for all of its products. A fleet of 10 tractors and 28 pneumatic truck trailers deliver bulk custom blended product directly to the customer's well site.
Don Caron, President and Chief Executive Officer of Bri-Chem, stated, "This United States based speciality cement blending acquisition represents another significant step in our strategic business plan to pursue growth opportunities in the cementing, stimulation and fracturing speciality fluid additives market in North America. We strongly believe that this segment of the drilling fluids market is poised to continue its growth and we are excited to pursue expanding this operation into other major shale plays throughout the USA."
Since our formation in 1985, Bri-Chem has established two primary segments of business through a combination of internal growth and acquisitions: Bri-Chem's Drilling Fluid Division is North America's largest independent wholesale supplier of drilling fluids for the oil and gas industry. We provide over 100 critical drilling fluid products, cementing, acidizing and stimulation additives from 29 strategically located warehouses throughout Canada and the United States; Bri-Chem's Steel Pipe Division is the first company to introduce and construct a Thermal Pipe Expansion (TPE) facility in North America for manufacturing, testing and supply of large diameter seamless steel pipe for the energy industry. Additional information about Bri-Chem is available at www.sedar.com or at Bri-Chem's website at www.brichem.com.
Forward Looking Statements
Certain information set forth in this news release contains forward-looking statements or information ("forward-looking statements"), including statements which may contain words such as "could", "should", "expect", "anticipate", "believe", "will", and similar expressions and statements relating to matters that are not historical facts are forward looking statements. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond the Company's control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, environmental risks, demand for oilfield services for drilling and completion of oil and natural gas wells; volatility in market prices for steel, oil, natural gas, and natural gas liquids and the effect of this volatility on the demand for oilfield services generally, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and the ability to access sufficient capital from internal and external sources. Although the Company believes that the expectations in our forward-looking statements are reasonable, our forward-looking statements have been based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and assumptions are based upon currently available information. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward looking information. As such, readers are cautioned not to place undue reliance on the forward looking information, as no assurance can be provided as to future results, levels of activity or achievements. The risks, uncertainties, material assumptions and other factors that could affect actual results are discussed in our Annual Information Form and other documents available at www.sedar.com. Furthermore, the forward-looking statements contained in this document are made as of the date of this document and, except as required by applicable law, the Company does not undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.
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