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TORONTO, Dec. 9, 2012 /CNW/ - Bird Construction Inc. ("Bird") (TSX: BDT) today announced that it has signed an agreement to acquire all of the outstanding shares of Nason Contracting Group Ltd. ("Nason"). The purchase price for the acquisition will be approximately $12.8 million.
The $12.8 million purchase price and related transaction expenses of $0.5 million will be funded with approximately $8.3 million of existing working capital and $5.0 million of shares of Bird Construction Inc. to be issued from treasury. The issuance of the shares of Bird is subject to the approval of the Toronto Stock Exchange. Bird has sufficient working capital to satisfy the purchase price detailed above. The acquisition is expected to be completed on or about January 15, 2013, subject to the satisfaction of all usual and customary conditions to closing.
Nason is a recognized leader in the construction of water and wastewater facilities in western Canada. Nason's revenue for their previous four full fiscal years averaged $37.0 million. The company has a 40-year track record of successful construction projects throughout Alberta, British Columbia, Saskatchewan and the Yukon and Northwest Territories. The company's head office, shops and yard are located in St. Albert, Alberta.
Nason performs the majority of its work with its own forces and has particular strength in the execution of mechanical, electrical and instrumentation work. The company has a highly-skilled staff of over 65 professional and craft employees. Nason's management team members have agreed to remain as employees and to assist Bird in the management of Nason's ongoing operations.
Nason's and Bird's businesses are complementary. Nason's primary expertise is in the mechanical, electrical and instrumentation aspects of water and wastewater projects whereas Bird's expertise lies in the general contracting of such projects and in the self performance of the civil and underground portions of the projects. Bird's general contracting and civil construction expertise will allow Nason to expand their operations. As well, Bird's expertise in design-build projects will provide further growth opportunities for Nason, particularly as it relates to the public-private-partnership delivery method which is a growth area in the water and wastewater market. Further, Nason's business is focused on the public market. Bird's contacts and expertise in the industrial market will open up new opportunities for both companies. Nason has extensive experience working on remote job sites which will be a particular advantage servicing the resource market.
"Bird and Nason are a great fit. Nason's expertise is in mechanical, electrical and instrumentation work while Bird is a leader in general contracting and civil work. Combining this expertise, we will be able to execute more complex work as well as assignments for industrial clients where our expertise is well suited to the demands of their projects" said Darrell Stang, President of Nason Contracting Group Ltd. "Joining with Bird will not only expand our opportunities as a company, but it will provide tremendous opportunities for our employees to grow and take on new and challenging assignments within the Bird organization."
"Bird has been considering a range of ways to further expand its sources of revenue through different market segments to continue with the growth strategy of the organization" commented Tim Talbott, President & CEO of Bird. "We are particularly excited about our first opportunity to participate directly in the mechanical, electrical and instrumentation markets which we believe will complement our existing service offerings. With both firms committed to pursuing exciting new opportunities for the organization, we are confident that a solid relationship will ensue with the management and employees of Nason."
A conference call for analysts and investors will be held at 9:00 AM ET on December 10, 2012 to present the particulars of the transaction to interested parties. The dial in number is 1-866-636-9090. Attendees are asked to be on the call 10 minutes prior to the start of the call. A transaction presentation that will form the basis of the call is available on Bird's website home page at www.bird.ca.
This press release contains forward-looking statements that involve a number of risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. Many factors could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful. The securities have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.
SOURCE: Bird Construction Inc.
For further information:
T.J. Talbott, President & CEO or
S.R. Entwistle, CFO
Bird Construction Inc.
5403 Eglinton Avenue West
Toronto, ON M9C 5K6
Phone: (416) 620-7122
Fax: (416) 620-1516