Press release from Marketwire
Badger Daylighting Ltd. Announces Agreement to Acquire the Operating Assets and Business of Fieldtek Holdings Ltd.
Thursday, October 17, 2013
Badger Daylighting Ltd. Announces Agreement to Acquire the Operating Assets and Business of Fieldtek Holdings Ltd.08:00 EDT Thursday, October 17, 2013
CALGARY, ALBERTA--(Marketwired - Oct. 17, 2013) - Badger Daylighting Ltd. (the "Company" or "Badger") (TSX:BAD) today announced that it has signed a definitive agreement to acquire the business and operating assets of Fieldtek Holdings Ltd. ("Fieldtek") for an aggregate purchase price of approximately $19.2 million, subject to certain customary closing adjustment, in cash to be financed using Badger's existing extendable revolving credit facility (the "Acquisition"). Closing is expected to occur on or about November 1, 2013, subject to certain closing conditions.
Summary of the Acquisition
Fieldtek is a privately owned company providing general vacuum truck and auxiliary services to the oil and gas industry, focusing primarily on production tank cleaning and removal of waste oil and sand. Based in Lloydminster, Alberta, Fieldtek has 55 employees and operates a fleet of 50 pieces of equipment including complete semi vacuum trucks and trailers, pressure trucks and steamer combo units. Fieldtek also has 19 lease operator units that work exclusively for Fieldtek. Fieldtek operates within a 150 kilometre radius from Lloydminster. The purchase price reflects a multiple of approximately four times Fieldtek's trailing twelve months normalized EBITDA.
The management team of Fieldtek will continue to operate the day-to-day business as a wholly owned subsidiary of Badger and will enter into non-competition agreements.
Badger's strategy of growing its hydrovac business by providing a value added local service to its many customers is supported with this acquisition of Fieldtek. In order to provide a high level of service Badger requires good equipment and very good people. The acquisition of Fieldtek provides Badger with excellent people and a good established base of operation in the Lloydminster and surrounding communities along the Alberta and Saskatchewan line. This area has high growth potential and with Fieldtek, Badger expects that its rate of growth in this area will accelerate. It should be noted that in the spring of 2007 Badger made a similar type of acquisition. Badger purchased Benko Sewer Service in London, Ontario to help support growth of the Badger business in Eastern Canada. All the key employees of Benko Sewer Service from 2007 remain with Badger today and continue to add tremendous value to Badger's operations. The vast majority of Badger's success and growth has been internally generated in the past and the plan is to continue with this strategy. Badger believes the addition of the high quality of people and the business of Fieldtek supports the stated strategy by providing the base Badger needs to grow in this important area of Western Canada.
Non-IFRS Financial Measures
EBITDA is defined as earnings before interest, taxes, depreciation and amortization and is a measure of the operating profitability and is therefore useful to management and investors. EBITDA provides an indication of the results generated by principal business activities of a company prior to how these activities are financed, assets are amortized or the results are taxed. Normalized EBITDA as it is used in relation to Fieldtek is defined as earnings before interest expense, income taxes, depreciation, amortization, and adjustments that are considered both non-recurring and market based in nature.
Badger is North America's largest provider of non-destructive excavating services. Badger traditionally works for contractors and facility owners in the utility and petroleum industries. The Company's key technology is the Badger Hydrovac, which is used primarily for safe digging in congested grounds and challenging conditions. The Badger Hydrovac uses a pressurized water stream to liquefy the soil cover, which is then removed with a powerful vacuum system and deposited into a storage tank. Badger manufactures its truck-mounted hydrovac units.
As stated earlier, closing of the acquisition of Fieldtek by Badger is expected to occur on or about November 1, 2013. However, closing is subject to the completion of various customary closing conditions. There can be no assurance that these closing conditions will be satisfied or waived. Consequently, there can be no assurance that the transaction will be completed as proposed or at all. Also as stated earlier, Badger expects that its rate of growth in the Lloydminster area will accelerate with its acquisition of the high quality people and business of Fieldtek. However, there is no guarantee that will be the case. Readers are cautioned not to place undue reliance on these forward-looking statements, which are given as of the date hereof, and to not use such forward-looking statements for anything other than their intended purpose. Badger undertakes no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
The Toronto Stock Exchange has neither approved nor disapproved the information contained herein.
FOR FURTHER INFORMATION PLEASE CONTACT:
Badger Daylighting Ltd.
President and CEO
Badger Daylighting Ltd.
Greg Kelly, CA
Vice President Finance and CFO