VANCOUVER, Jan. 16 /CNW/ - Precision Assessment Technology Corporation
("PATC" or the "Company") announced today that the acquisition of 16 rigs and
10 crews from Spectrum Drilling, a wholly owned subsidiary of Kleinfelder, is
The assets were purchased by PATC No. 1 Limited Partnership (the L.P.).
The purchase price was approximately US $2.5 million which was funded by the
L.P. The L.P. leased the assets to PATC under an operating lease.
Revenue from the operation of these assets is expected to exceed
$5.0 million and EBITDA contribution is expected to exceed $0.9 million before
lease payments of $0.3 million. The financial performance of these assets will
be reported under PSI.
As part of this transaction, PATC has entered into its first 'preferred
supplier agreement' (the PSA) with Kleinfelder, a $300 million consulting firm
with 20 offices throughout the US. The PSA contains incentives for Kleinfelder
to cause it to purchase in excess of $4.0 million of drilling services from
PATC annually (in 2007 PATC revenue with Kleinfelder was approximately
$0.4 million). In addition, PATC has secured the opportunity to bid on
Kleinfelder work nation-wide.
This acquisition secures offices in Northern California (Stockton) and
Colorado Springs, Colorado. PATC has the right to purchase the assets from the
L.P. at any time at fair market value, subject to regulatory approval if any
of the purchase price is to be funded by the issue of common shares. PATC
intends to affect this purchase some time before December 31, 2008.
PATC's existing operations are performing well. BC2's results for 2007
were 50% ahead of expectations. TSI (the trenchless division), exceeded 2006
results by approximately 30%. The sonic rigs are now fully operational and as
a result GPI's operations are back on track. PSI (Richmond) is now producing
revenue at its normal levels. With the Spectrum acquisition now completed, the
management team in place and the integration of the various acquisitions
largely complete, 2008 is expected to be a year where PATC emerges with
sustainable levels of EBITDA. Revenue is budgeted to exceed $25 mm in 2008.
About PATC - PATC provides drilling services for site assessment and
remediation and groundwater assessment, monitoring and mitigation in the
United States. These services are provided using specialized and innovative
drilling and sampling equipment and technologies from offices in California
and Florida. Precision Assessment Technology Corporation operates through its
wholly owned U.S. subsidiaries, Precision Sampling, Inc., Trenchless
Specialties Inc. and BC2 Environmental Corp. Further information can be found
at www.patc-usa.com. PATC's common shares are listed on the Toronto Stock
Exchange under the symbol "PDT".
FORWARD-LOOKING STATEMENTS: Except for statements of historical fact, all
statements in this news release - including, without limitation, statements
regarding future plans and objectives of PATC are forward-looking statements
that involve various risks and uncertainties. Forward-looking statements in
this document are often, but not always, identified by the use of words such
as "anticipate" and "intend" and statements that an event or result "will"
occur or be achieved and other similar expressions. There can be no assurance
that such statements will prove to be accurate; actual results and future
events could differ materially from those anticipated in such statements.
For further information:
For further information: Tony Kirschner, Vice President, Corporate
Development, PATC, Tel: (604) 669-3373 (Ext. 208)