- Proceeds to be Redeployed to Reduce Debt -
TSX Symbol: SQP
MISSISSAUGA, ON, Sept. 29, 2014 /CNW/ - Strongco Corporation (TSX:SQP) announced today that it has completed the sale and 15-year leaseback of its Mississauga location, which houses its main Volvo branch in Ontario, as well as central services and corporate office, for the purchase price of $17.25 million.
As previously announced, Strongco plans to monetize several of its real estate holdings through sale and leaseback transactions, with proceeds to be redeployed to reduce debt. In addition to the Mississauga location, Strongco has now completed the sales of the recently constructed branches in Fort McMurrray, Alberta and Saint Augustin-de-Desmaures, Quebec. The sale of branches in Val D'Or, Quebec and Moncton, New Brunswick are expected to close in the fourth quarter. The gross proceeds from the transactions are expected to be approximately $47 million.
"It has always been our strategic intent to not tie up capital in real estate assets over the long term, and, given the substantial increase in property values within these regions, we believe it is an opportune time to sell and lease back these properties and use the proceeds more effectively within the business operations," said Bob Dryburgh, President and Chief Executive Officer. "These sale and leasebacks support our strategy to continually strengthen Strongco's balance sheet and deploy capital more efficiently."
About Strongco Corporation
Strongco Corporation is a major multiline mobile equipment dealer with operations across Canada and in the United States, operating through Chadwick-BaRoss, Inc. Strongco sells, rents and services equipment used in diverse sectors such as construction, infrastructure, mining, oil and gas, utilities, municipalities, waste management and forestry. The Company has approximately 750 employees serving customers from 27 branches in Canada and five in the United States. Strongco represents leading equipment manufacturers with globally recognized brands, including Volvo Construction Equipment, Case Construction, Manitowoc Crane, including National and Grove, Terex Cedarapids, Terex Finlay, Terex Fuchs, Terex Trucks, Ponsse, Fassi, Sennebogen, Konecranes and SDLG. Strongco is listed on the Toronto Stock Exchange under the symbol SQP.
This news release contains "forward-looking" statements within the meaning of applicable securities legislation which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Strongco or industry results, to be materially different from any future results, events, expectations, performance or achievements expressed or implied by such forward-looking statements. All such forward-looking statements are made pursuant to the "safe harbour" provisions of applicable Canadian securities legislation. Forward-looking statements typically contain words or phrases such as "may", "outlook", "objective", "intend", "estimate", "anticipate", "should", "could", "would", "will", "expect", "believe", "plan" and other similar terminology suggesting future outcomes or events. This news release contains forward-looking statements relating to the expected trading of common shares of Strongco on the TSX, and such statements are based upon the expectations of management.
SOURCE: Strongco Corporation
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