Enterprise Group, Inc. (“Enterprise,” or “the Company”) (TSX:E) is pleased to announce that it has entered into a binding asset purchase agreement (the “Agreement”) to divest the assets of its utility construction business unit, T.C. Backhoe & Directional Drilling (“TCB”). The assets will be acquired by TC Infrastructure Services Ltd., a wholly owned subsidiary of Quanta Services, Inc. (“Quanta”).
Gross cash proceeds from this transaction will be approximately $16.9 million. Enterprise will also receive payment of working capital, which the Company anticipates will amount to approximately $3.0 million. All proceeds from this transaction will be deployed towards reducing Enterprise’s debt. As at March 31, 2016, the Company had total loans and borrowings of $40.6 million.
Closing is expected to occur on or around July 5, 2016, subject to customary closing conditions.
“Since its acquisition in 2007, TCB has made valuable contributions to Enterprise’s overall business,” stated Leonard Jaroszuk, the Company’s Chief Executive Officer. “However, the nature of our business has evolved, and we believe this transaction will help streamline Enterprise’s offerings to best fit both the needs of our current client base and the changing landscape of the Western Canadian energy industry. Furthermore, proceeds from this transaction will greatly improve the security of our financial position. I would like to express my sincere appreciation to the employees of TCB for their contributions over the years and wish them well in their future endeavors as part of Quanta.”
About Enterprise Group, Inc.
Enterprise Group, Inc. is a consolidator of construction services companies operating in the energy, utility and transportation infrastructure industries. The Company’s focus is primarily construction services and specialized equipment rental. The Company’s strategy is to acquire complementary service companies in Western Canada, consolidating capital, management, and human resources to support continued growth. More information is available at the Company’s website, www.enterprisegrp.ca.
Certain statements contained in this news release constitute forward-looking information. These statements relate to future events or the Company’s future performance. The use of any of the words “anticipate”, “could”, “expect”, “believe”, “will”, “projected”, “estimated” and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the Company’s current belief or assumptions as to the outcome and timing of such future events. In particular, this news release includes forward-looking information regarding the completion of the sale of TCB assets and the proceeds therefrom. These forward-looking statements are based on assumptions and are subject to numerous risks and uncertainties, certain of which are beyond the Company’s control, including the satisfaction or waiver of closing conditions to the asset sale, obtaining all necessary third party consents and approvals, general economic conditions, industry conditions, volatility of commodity prices and competition. Actual future results may differ materially. The Company’s annual information form for the year ended December 31, 2015 and other documents filed with securities regulatory authorities (accessible through the SEDAR website www.sedar.com) describe the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference. The Company disclaims any intention or obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as may be expressly required by applicable securities laws.
Enterprise Group, Inc.
President & CEO
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