CALGARY, Sept. 12, 2014 /CNW/ - Pure Technologies Ltd. ("Pure" or the
"Company") (TSX: PUR) announced today that it has entered into a
definitive agreement to acquire the oil and gas pipeline inspection
services business and related assets of Hunter McDonnell Pipeline Services, Inc. and its affiliated companies ("HM"), a
leading provider of technology-driven integrity services to the oil and
gas pipeline industry, for consideration of $8 million, consisting of
$6 million in cash and $2 million in common shares of Pure, issuable in
equal tranches on each of the first, second and third anniversaries of
the closing date of the transaction. Closing of the transaction is
expected to occur early in the third quarter of 2014. For the financial
year ended March 31, 2014, HM generated revenue more than $10 million.
"This is a highly accretive acquisition for the Company and will serve
as a catalyst for expansion into the oil and gas pipeline sector," said
Jack Elliott, President and CEO of Pure. "While we have been growing
our presence in this sector over the past few years through the
deployment of our SmartBall® leak detection technology, the acquisition of the HM business will
accelerate this growth. Similar to our own strategy for the water
sector, HM has been at the leading edge of developing and enhancing a
suite of premium technologies and asset management services, from
pipeline surveys and remote tracking of in-line inspection tools to
risk assessment and engineering. When combined with Pure's existing
services, the Company will be now able to provide hydrocarbon pipeline
operators with unparalleled information for use within their integrity
Since 2011, HM has provided tracking services on Pure's SmartBall
technology inspections for the Company's North American oil pipeline
clients. In August of 2013, Pure and HM entered into a partnership
agreement whereby Pure trained HM staff to deploy the SmartBall
technology in oil pipelines within North America.
"HM has built an excellent reputation for itself within the industry
over the years," said Mark Holley, Pure's Executive Vice President and
COO. "Considerable R&D spending has led to the development of HM's
enhanced, proprietary products and services, patents and trade secrets.
This has resulted in recent significant growth which is expected to
continue as regulatory and stakeholder pressures drive increased
emphasis on pipeline inspection and integrity programs."
HM's business will, following closing of the transaction and the
transition of operations, be transacted through PureHM Inc. in Canada
and PureHM U.S. Inc. in the U.S. ("PureHM"), newly-incorporated
subsidiaries of the Company. Pure will transfer all of its activities
related to the oil and gas pipeline industry to PureHM. Shamus McDonnell, co-founder and CEO of HM, will assume the position of
President, PureHM, and Jim Hunter, co-founder and Vice President of
Operations for HM, will assume the same position with PureHM.
"We are excited to expand on the relationship we've enjoyed with Pure
over the past three years," said Shamus McDonnell, co-founder of HM. "By joining a proven entity with a widespread
geographical presence in North America and elsewhere, a strong research
and development team and a healthy balance sheet, together we will be
able to capitalize on the growing demand we are seeing for our services
in the oil and gas pipeline market. In addition, the SmartBall
technology, with its enhanced pipe wall assessment capabilities, is
ideal for complementing existing pipeline integrity programs, or as an
integrity check on non-piggable pipelines which constitute the majority
of hydrocarbon pipelines within North America. We see this unique
technology as a natural fit with HM's innovative technologies and
services, and we expect to see an acceleration of its use moving
For supplemental information on PureHM, please visit: http://puretechltd.investorroom.com/presentations-webcasts
About Hunter McDonnell Pipeline Services (HM)
Founded in 1995 by Jim Hunter and Shamus McDonnell, Hunter McDonnell Pipeline Services (www.hmpsi.com) offers a range of premium, technology-driven pipeline products and
services to the pipeline industry. It is headquartered in Edmonton, AB,
Canada, with offices in Houston, Texas and Oakland, California. HM's
service offerings include third party pipeline pig tracking,
right-of-way surveys and inspections, and pipeline integrity and
engineering services throughout North America. HM has more than 60
full-time employees and provide services to over 200 customers.
HM generates revenue through the following service offerings:
Tracking of third‐party in‐line inspection tools utilizing ARMADILLO, a proprietary wireless remote tracking technology ("pig‐tracker") with
real‐time web‐based user interface. This permits pipeline operators to
track the progress of in‐line inspection tools from any Internet
connection. Armadillo is recognized as an industry‐leading product and
is the only third party pig‐tracker to reliably track Pure's SmartBall
inspection tool in oil pipelines;
Over‐the‐line pipeline surveys utilizing HM's patented SPECTRUM XLI technology;
Pipeline optimization and management through HM's proprietary PipeWISE software platform;
Specialty pipeline integrity engineering services.
About Pure Technologies Ltd.
Pure Technologies Ltd. is an international asset management technology
and services company which has developed patented technologies for
inspection, monitoring and management of critical infrastructure around
the world. Pure's business model incorporates four distinct but
complementary business streams:
Sales of proprietary monitoring technologies for pipelines, bridges and
structures (SoundPrint®, SoundPrint® AFO);
Recurring revenue from data analysis and site maintenance for these technologies, and from
Premium technical services including pipeline inspection, leak detection and condition assessment (PureEM™, SmartBall®, Sahara®, PipeDiver®, PureRobotics®; PureMFL™;
Specialized engineering services in areas related to asset management, primarily in the area of pipeline
condition assessment for water and wastewater infrastructure.
This News Release contains forward-looking statements, including,
without limitation, statements containing the words "should",
"believe", "anticipate", "may", "plan", "will", "continue", "intend",
"expect", "estimate" and other similar expressions. These statements
constitute "forward-looking information" within the meaning of
applicable Canadian securities laws. These statements are based on the
Company's current expectations, estimates, forecasts and assumptions.
Forward-looking statements are not guarantees of future performance and
are subject to risks, uncertainties and other important factors that
could cause the Company's actual performance to be materially different
from that projected. Examples of these statements would include those
where the Company forecasts the timing of new and existing projects,
the success of the Company's new technologies and entering new markets,
the Company's ability to generate future cash flows and the timing and
amount of future dividend payments. The assumptions, risks and
uncertainties that could cause actual results to differ materially from
the forward-looking information, include, but are not limited to,
market changes, the Company's ability to deliver services in a timely
and cost effective manner, technological change, changes in general
economic conditions and other risks detailed from time to time in our
ongoing filings with the Canadian securities regulatory authorities,
including those in the Company's Annual Information Form, which filings
can be found at www.sedar.com. Given these assumptions, risks and
uncertainties, readers are cautioned not to place undue reliance on
such forward-looking statements. Unless otherwise required by
applicable securities laws, the Company undertakes no obligation to
publicly update or revise any forward-looking statements either as a
result of new information, future events or otherwise.
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SOURCE: Pure Technologies Ltd.
For further information:
To find out more about Pure Technologies Ltd. (TSX: PUR), visit our website at www.puretechltd.com or contact Paul Moon, Investor Relations; 403 266-6794 or firstname.lastname@example.org.