CALGARY, Feb. 7, 2012 /CNW/ - Trimac Transportation Ltd. ("Trimac") (TSX: TMA) announced today that it has entered into an agreement to
acquire a 29% interest in Northern Resource Trucking Limited
Partnership ("NRT") for a purchase price of $9,000,000. The transaction will be a cash
and share transaction with $1,000,000 of the purchase price being
satisfied in cash and $8,000,000 of the purchase price being satisfied
by the issuance of Class A Common Shares of Trimac, subject to the
approval of the Toronto Stock Exchange (the "TSX"). The issue price per Class A Common Share will be equal to the ten
day volume weighted average closing price of the Class A Common Shares
on the TSX for the 10 trading days immediately prior to closing. Based
on the closing market price of the Class A Common Shares on the TSX on
Friday, February 3, 2012 of $4.30, it is estimated that approximately
1,860,465 Class A Common Shares will be issued, representing
approximately 7.3% of the total number of voting shares of Trimac
currently outstanding on a non-diluted basis. It is expected that the
transaction will close on or about March 19, 2012.
NRT provides trucking services primarily to the uranium mining industry
in Northern Saskatchewan. NRT has also been a valuable and reliable
business partner for Trimac over the years providing overflow
subcontractor support to Trimac's key customers in a variety of product
lines. NRT has approximately 80 tractors, 140 trailers and 150
employees and owner operators. NRT is based out of Saskatoon,
Trimac is purchasing the interests in NRT from Trimac Investments
Limited Partnership ("TILP"), which acquired the interests in 2005 in connection with the
formation of Trimac Income Fund. In addition to TILP, the NRT limited
partners are comprised of a group of ten First Nations and Métis
partners from communities across Northern Saskatchewan. Predecessor
entities and affiliates of Trimac have been partners in NRT or
predecessors thereof since 1986.
In commenting on the transaction, Ed Malysa, President and Chief
Operating Officer of Trimac and a current director of NRT, remarked
"NRT is a strategic partner that is the leader in bulk transportation
in Northern Saskatchewan. By exploiting Trimac's expertise and NRT's
strong market position, the acquisition is expected to provide
accretive earnings to Trimac."
TILP is a wholly owned subsidiary of Trimac Holdings Ltd. ("Trimac Holdings"), the principal shareholder of Trimac. Trimac Holdings is controlled
by Jeffrey J. McCaig, the Chairman and Chief Executive Officer of
Trimac. The transaction was reviewed and unanimously approved by the
independent directors of Trimac, who also secured third party financial
advice on the value of the transaction.
Based on the current market price of the Class A Common Shares, it is
anticipated that the transaction will increase the total number of
outstanding voting shares of Trimac beneficially owned, directly or
indirectly, or controlled by Jeffrey J. McCaig, on a fully diluted
basis, including the voting shares owned by Jeffrey J. McCaig
indirectly through Trimac Holdings, from 45.41% to 49.06%.
About Trimac: Trimac is Canada's largest provider of bulk trucking
services with operations from coast to coast. In addition, through its
National Tank Services division, Trimac performs repairs, maintenance
and tank-trailer cleaning services for both the Trimac fleet and for
third party commercial customers. Trimac also provides third party
transportation logistics services in Canada and the United States
through its wholly owned subsidiary Bulk Plus Logistics.
This press release contains information and statements of a
forward-looking nature concerning the accretive value of the NRT
acquisition to Trimac. These statements are based on suppositions and
uncertainties as well as on management's best possible evaluation of
future events. In making such statements, Trimac has assumed that NRT's
results would be consistent with historical levels. Certain factors
may cause actual results to differ from such statements including,
without limitation, general market trends and conditions, increased
competition and a decrease in demand for the products of the uranium
mining industry. As a result, readers are advised that actual results
may differ from expected results.
SOURCE Trimac Transportation Ltd.
For further information:
Edward V. Malysa
President and Chief Operating Officer
Trimac Transportation Ltd.
Scott D. Calver
Vice President and Chief Financial Officer
Trimac Transportation Ltd.