TerraVest Capital Inc. To Acquire NWP Industries Inc.

VEGREVILLE, AB and TORONTO, Aug. 5, 2014 /CNW/ - TerraVest Capital Inc. (TSX:TVK) (the "Company" or "TerraVest") announced today that a wholly owned subsidiary of the Company has entered into an agreement to acquire certain assets and liabilities of NWP Industries Inc. ("NWP "), a privately-owned Innisfail, Alberta based company primarily focused on manufacturing high quality oil & gas processing equipment for customers in Western Canada.

The purchase price paid for NWP will be $12.6 million; consisting of $10.0 million in cash and $2.6 million in the issuance of TerraVest common shares. The TerraVest common shares will be subject to a 3 year lock-up agreement (with the release of 1/3 of the shares on each anniversary of the closing) and held with the third generation President of NWP, Mitch DeBelser. NWP will continue to operate as NWP Industries LP.

The purchase price represents approximately 4.25x NWP's EBITDA for the most recent fiscal year.

TerraVest will use a portion of the cash proceeds from its recent equity offering to fund the acquisition.

Mr. DeBelser and existing management will continue on at NWP Industries LP and play a pivotal role in growing the company.

Charles Pellerin, Executive Chairman of TerraVest, welcomes the management team and employees of NWP and looks forward to their continuing commitment to the business and its customers.

"We told our shareholders that we intended to grow TerraVest in our existing lines of business and leverage our management expertise to enhance growth opportunities", said Mr. Pellerin. "Today is another step in that direction".

"NWP and RJV Gas Field Services offer some of the best oil and gas processing equipment in the country. Their products are similar in nature and the companies will now work together to complement each other's strengths".

Debi DeBelser, second generation President of NWP said, "NWP started over 50 years ago with my father Mike Chwelos. I would like to thank our employees for their dedication over the years and the significant contribution they have made to NWP's achievements. I look forward to seeing NWP reach new heights under the guidance of Mitch DeBelser and with the assistance of TerraVest".

Dale Laniuk, CEO of TerraVest said, "Having founded an oil & gas processing equipment company myself, I understand the hard work and dedication that the DeBelser family and its employees have put in to have been able to reach a 50th anniversary. We welcome the employees of NWP to TerraVest and we are excited about the expansion of our business".

Acquisition Highlights

  • TerraVest believes the acquisition complements TerraVest's current operating businesses and offers a number of operating and financial benefits to shareholders, including:
  • NWP and RJV Gas Field Services working together as sister companies with coinciding management teams sharing core competencies across the businesses;
  • Enhanced product offering, scale and additional options for customers;
  • Coordination and streamlining of manufacturing expertise at Gestion Jerico; and
  • Further diversification of TerraVest's overall customer base.

The acquisition, which is expected to close in August 2014, is subject to customary closing conditions for a transaction of this nature, including acceptance and final approval by the Toronto Stock Exchange (the "TSX") of the listing of the TerraVest shares to be issued as part of the transaction.

About TerraVest Capital Inc.

TerraVest Capital Inc. has a mandate to look for stable cash flow (and/or growing) businesses that will increase cash flow.  At the present time, the company is focused on evaluating opportunities in oil & gas processing equipment and liquid containment sectors (such as propane tanks, commercial tanks and home heating products) which require expertise in metal fabrication and welding.

About NWP Industries Inc.

NWP Industries Inc. is a 50 year old family owned and operated business based in Innisfail, Alberta.  The company manufactures oil & gas processing equipment such as oil & gas separation equipment, line heaters and tanks.  The company's customers include major oil & gas producers in Western Canada.

Forward-Looking Information:

Certain statements contained or incorporated by reference herein, including those that express management's expectations or estimates of future developments or TerraVest future performance, constitute "forward-looking statements" within the meaning of applicable securities laws, and can generally be identified by words such as "will", "may", "could" "expects", "believes", "anticipates", "forecasts", "plans", "intends" or similar expressions. These statements are not historical facts but instead represent management's expectations, estimates and projections regarding future events and performance.

Forward-looking statements are necessarily based upon a number of opinions, estimates and assumptions that, while considered reasonable by management at the time the statements are made, are inherently subject to significant business, economic and competitive risks, uncertainties and contingencies. TerraVest cautions that such forward-looking statements involve known and unknown contingencies, uncertainties and other risks that may cause TerraVest's actual financial results, performance or achievements to be materially different from its estimated future results, performance or achievements expressed or implied by those forward-looking statements. Numerous factors could cause actual results to differ materially from those in the forward-looking statements, including without limitation: impact of general economic conditions; its dependence on key customers; cyclical trends in TerraVest's customers' industries; sufficient availability of raw materials at economical costs; weather conditions, production and sales; TerraVest's ability to develop new customers; changes in accounting policies and methods, including uncertainties associated with critical accounting assumptions and estimates; changes in the value of the Canadian dollar relative to the US dollar; changes in tax laws and potential litigation; ability to obtain financing on acceptable terms; environmental damage caused by it and non-compliance with environmental laws and regulations; potential product liability and warranty claims and equipment malfunction. This list is not exhaustive of the factors that may affect any of TerraVest's forward-looking statements.

Investors are cautioned not to put undue reliance on forward-looking statements. All subsequent written and oral forward-looking statements attributable to TerraVest or persons acting on its behalf are expressly qualified in their entirety by this notice. Forward-looking information contained herein is made as of the date of this press release and, whether as a result of new information, future events or otherwise, TerraVest disclaims any intent or obligation to update publicly these forward-looking statements except as required by applicable laws.

SOURCE: TerraVest Capital Inc.

For further information:

please contact Mitchell Gilbert, Chief Investment Officer, TerraVest Capital Inc. at 416.364.0064 mitchell.gilbert@terravestcapital.com or Paul Casey, Chief Financial Officer, TerraVest Capital Inc., (780) 632-2040, pcasey@terravestcapital.com


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