Acasta Announces Acquisition of ECN Capital's Commercial Aviation Business

TORONTO, May 12, 2017 /CNW/ - Acasta Enterprises Inc. (TSX: AEF.B and AEF.WT) ("Acasta" or the "Company") today announced that Stellwagen Group, Acasta's leading commercial aviation finance advisory and asset management business has entered into an agreement to acquire ECN Capital's Commercial Aviation advisory and asset management business ("ECN Commercial Aviation").  ECN Aviation arranges, co-invests and manages a portfolio of commercial aviation assets on behalf of institutional investors.  It comprises a highly skilled US based team and manages C$1.7 billion of aircraft assets.

"The acquisition of ECN Commercial Aviation further enhances Acasta's specialized aviation asset management business," said Anthony Melman, Acasta's Chairman and CEO.  "Stellwagen will capitalize on ECN's successful platform as a vertically integrated provider of aviation advisory services. ECN Commercial Aviation is highly complementary with the core advisory and aircraft management businesses of Stellwagen, which provide holistic aircraft solutions to operators and institutional investors. This transaction will enable us to amplify Stellwagen's reach, standing and value in the global aviation industry, and enhance and broaden our relationship with institutional investors."

Highlights of the ECN Commercial Aviation acquisition are as follows:

  • It will provide Stellwagen with an established asset management platform, complementary expertise, and increased distribution capabilities
  • Acquisition includes ECN Commercial Aviation's highly skilled team based out of Stamford, Connecticut, which has significant experience and relationships in the aviation industry
  • C$1.7 billion in assets under management, with a portfolio of 45 commercial passenger aircraft on lease to 30 global airlines
  • Transaction is expected to create significant strategic advantages and synergies when combined with Stellwagen, including internalization of aircraft servicing contracts and cross-sharing of existing institutional relationships
  • The acquisition is expected to be immediately accretive to 2017 earnings
  • The purchase price for ECN Commercial Aviation is US $22.5 million payable by the issuance of Class B Shares of Acasta at $10 per share with a one year lock-up, subject to a top-up of up to 10% if Acasta's share price is less than $10 after the lock-up expires.

 

"We are acquiring and partnering with an experienced management team and a highly successful financing platform," said Douglas Brennan, founder and CEO of Stellwagen. "This acquisition enables us to leverage ECN Commercial Aviation's established fund platform, management team, and institutional relationships, significantly accelerating our initial goal of US$5 billion of assets under management."

About Acasta Enterprises Inc.:
Acasta Enterprises Inc. is a leading Canadian public company that acquires businesses with exceptional potential for value creation through strategic and transformational initiatives. As a proactive private equity manager, Acasta partners with the senior management teams of its acquired businesses, empowering them to pursue value creating trajectories.

Cautionary Note Regarding Forward-Looking Statements

This news release may contain forwardlooking statements (within the meaning of applicable securities laws) which reflect Acasta's current expectations regarding future events. Forward-looking statements are identified by words such as "believe", "anticipate", "project", "expect", "intend", "plan", "will", "may", "estimate" and other similar expressions. These statements are based on Acasta's expectations, estimates, forecasts and projections and include, without limitation, statements regarding the completion of the ECN Aviation acquisition and the expected benefits of the ECN Aviation acquisition.

The forward-looking statements in this news release are based on certain assumptions, including without limitation, that Acasta's future objectives and strategies to achieve those objectives will not change, including, without limitation, the expected operations, financial results and condition of Acasta following the ECN Aviation acquisition, as well as other statements with respect to management's beliefs, plans, estimates and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Acasta has made certain assumptions with respect to, among other things, the anticipated receipt of any required regulatory approvals and consents, the expectation that no event, change or other circumstance will occur that could give rise to the termination of the purchase agreement for the ECN Aviation acquisition, as well as assumptions concerning currency exchange and interest rates. The forward-looking statements are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including, but not limited to, the factors discussed under the heading "Risk Factors" in Acasta's annual information form for the fiscal year ended December 31, 2016, a copy of which is available on the SEDAR website at www.sedar.com under Acasta's profile. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, these forward-looking statements are made as of the date of this news release and, except as expressly required by applicable law, Acasta assumes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

SOURCE Acasta Enterprises Inc.

For further information: please contact: Acasta Enterprises Inc., Ian Kidson, 647-725-6707, Chief Financial Officer and Chief Operating Officer

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