Stock Monitor: Payment Data Systems Post Earnings Reporting
LONDON, UK / ACCESSWIRE / November 29, 2017 / Active-Investors issued a free report on Civeo Corp. (NYSE: CVEO), which is readily accessible upon registration at www.active-investors.com/registration-sg/?symbol=CVEO as the Company's latest news hit the wire. On November 27, 2017, the Company announced that it has signed an agreement to acquire Noralta Lodge Ltd, a premier, Alberta-based provider of remote accommodations to the Canadian oil sands region. The transaction is valued approximately C$367 million ($289 million USD) subject to adjustments at closing. The deal combines two major workforce accommodation providers in the Canadian oil sands region. Sign up now for our free research reports at:
Active-Investors.com is currently working on the research report for Payment Data Systems, Inc. (NASDAQ: PYDS), which also belongs to the Services sector as the Company Civeo. Do not miss out and become a member today for free to access this upcoming report at:
Active-Investors.com is focused on giving you timely information and the inside line on companies that matter to you. This morning, Civeo most recent news is on our radar and we have decided to include it on our blog post. Today's free coverage is available at:
Commenting on the acquisition of Noralta, Bradley J. Dodson, President and CEO of Civeo, said:
"It will enhance our catering and facilities management capabilities and will give us greater opportunities to optimize occupancy for our customers across more locations with wider accommodation options. This transaction combines the two Companies' operational strengths, facilities, and commitment to exceptional service, and strengthens our position as partner of choice for our customers."
Corey Smith, President and CEO of Noralta, added:
"This deal uniquely positions the combined Company to deliver customer-facing, full-service lodging solutions through a network of leading First Nation and community partnerships. Sharing a commitment to the oil sands region, Noralta and Civeo bring complementary expertise together, creating an enhanced service offering that will effectively meet the evolving needs of our customer base."
Details of the agreement
As per the terms of the acquisition agreement, Civeo will acquire 100% equity of Noralta for approximately C$367 million, on a cash-free, debt-free basis, subject to adjustment at closing. Out of the total, Civeo will pay C$210 million ($165 million) in cash and balance via 32.8 million Civeo's shares valued at $2.10 per share paid to Noralta's equity shareholders. Noralta's equity shareholders will be unable to sell any Civeo's shares for an 18-month period after the close of the transaction as per the terms of the agreement. Noralta's shareholders who have non-voting convertible preferred equity with 2% dividend rate will initially be convertible into 29.3 million Civeo's common shares. The preferred equity shareholders will have the right to convert their holdings into Civeo's shares only after two years of the closing of the transaction at 3.30 per share. This price represents a premium of 64% of Civeo's share price at the closing on November 24, 2017. However, Civeo holds the right to convert the preferred equity into Civeo's shares or redeem the entire preferred equity by paying cash including the dividend portion, at any point after the close of the transaction.
The issue of Civeo's shares as part of the agreement, will need Civeo's shareholders' approval. The transaction is expected to close in Q2 2018 and is subject to regulatory approvals and other closing conditions. Civeo plans to finance the cash portion of the transaction using a mix of cash in hand and existing revolving credit facility.
Once the transaction is completed, Noralta's shareholders will be allowed to nominate one director to the Civeo's Board.
Benefits of the deal
The transaction is expected to be accretive to the Company's cash flows and increase its operating cash flow by approximately 75% for the 12-month period ending on September 30, 2017. Civeo will also be able to reduce its debts from 4.4 times on standalone basis to 3.2 times on a pro forma combined basis. Civeo will also benefit from Noralta's ongoing contracts with two major oil sands producers which contribute to annual revenues up to C$130 million for the contract period. The transaction is expected to result in annual synergies of C$10 million by 2019 from various operational and corporate efficiencies. For the twelve-month period ending on August 31, 2017, Noralta's revenue was C$155 million, net income was C$32 million, and EBITDA came in at C$71 million.
Apart from the financial benefits, Civeo will also gain by expanding its portfolio of workforce accommodation offerings at multiple complementary locations and a majority of these would be premium private rooms. The acquisition is in-line with Civeo's strategy of making strategic acquisitions of operator-owned accommodation facilities, including investing in customer-facing technologies, and focusing on disciplined growth opportunities. The acquisition will allow the combined Company to have a stronger balance sheet due to increased cash flows and reduced debts. The existing contracts that Noralta has with two major oil sands producers are expected to have need for more accommodations even after contract period given the growth of their oil sands resources.
About Civeo Corp.
Houston, Texas based Civeo is a global workforce accommodation specialist with prominent market positions in the Canadian oil sands and the Australian natural resource regions. The Company offers a wide range of housing solutions for hundreds of thousands of workers on a long-term as well as temporary basis along with catering, facility management, water systems, and logistics services. Civeo has over 23,000 rooms across the 19 lodges owned by it in Canada and Australia
About Noralta Lodge
Alberta, Canada based Noralta is premier provider of remote accommodations to the Canadian oil sands region. It offers full service open lodge accommodations, facilities management services, and turnkey solutions. It has a total of 7,900 rooms out of which over 5,700 rooms are owned by it. These rooms are in eleven lodges located across Northern Alberta.
Stock Performance Snapshot
November 28, 2017 - At Tuesday's closing bell, Civeo's stock climbed 2.02%, ending the trading session at $2.02.
Volume traded for the day: 1.16 million shares, which was above the 3-month average volume of 842.48 thousand shares.
Stock performance in the last month – up 3.06%; previous three-month period – up 2.54%; past six-month period – up 8.60%; and last twelve-month - up 12.85%
After yesterday's close, Civeo's market cap was at $264.52 million.
The stock is part of the Services sector, categorized under the Business Services industry. This sector was up 0.9% at the end of the session.
Active-Investors (A-I) produces regular sponsored and non-sponsored reports, articles, stock market blogs, and popular investment newsletters covering equities listed on NYSE and NASDAQ and Canadian stocks. A-I has two distinct and independent departments. One department produces non-sponsored analyst certified content generally in the form of press releases, articles and reports covering equities listed on NYSE and NASDAQ and the other produces sponsored content (in most cases not reviewed by a registered analyst), which typically consists of compensated investment newsletters, articles and reports covering listed stocks and micro-caps. Such sponsored content is outside the scope of procedures detailed below.
A-I has not been compensated; directly or indirectly; for producing or publishing this document.
PRESS RELEASE PROCEDURES:
The non-sponsored content contained herein has been prepared by a writer (the "Author") and is fact checked and reviewed by a third-party research service company (the "Reviewer") represented by a credentialed financial analyst [for further information on analyst credentials, please email email@example.com. Rohit Tuli, a CFA® charterholder (the "Sponsor"), provides necessary guidance in preparing the document templates. The Reviewer has reviewed and revised the content, as necessary, based on publicly available information which is believed to be reliable. Content is researched, written and reviewed on a reasonable-effort basis. The Reviewer has not performed any independent investigations or forensic audits to validate the information herein. The Reviewer has only independently reviewed the information provided by the Author according to the procedures outlined by A-I. A-I is not entitled to veto or interfere in the application of such procedures by the third-party research service company to the articles, documents or reports, as the case may be. Unless otherwise noted, any content outside of this document has no association with the Author or the Reviewer in any way.
A-I, the Author, and the Reviewer are not responsible for any error which may be occasioned at the time of printing of this document or any error, mistake or shortcoming. No liability is accepted whatsoever for any direct, indirect or consequential loss arising from the use of this document. A-I, the Author, and the Reviewer expressly disclaim any fiduciary responsibility or liability for any consequences, financial or otherwise arising from any reliance placed on the information in this document. Additionally, A-I, the Author, and the Reviewer do not (1) guarantee the accuracy, timeliness, completeness or correct sequencing of the information, or (2) warrant any results from use of the information. The included information is subject to change without notice.
NOT AN OFFERING
This document is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Please read all associated disclosures and disclaimers in full before investing. Neither A-I nor any party affiliated with us is a registered investment adviser or broker-dealer with any agency or in any jurisdiction whatsoever. To download our report(s), read our disclosures, or for more information, visithttp://active-investors.com/legal-disclaimer/.
For any questions, inquiries, or comments reach out to us directly. If you're a company we are covering and wish to no longer feature on our coverage list contact us via email and/or phone between 09:30 EDT to 16:00 EDT from Monday to Friday at:
Phone number: 73 29 92 6381
Office Address: 6, Jalan Kia Peng, Kuala Lumpur, 50450 Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur, Malaysia
CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.