ST. ALBERT, ALBERTA--(Marketwired - Jul 31, 2014) - Enterprise Group, Inc. ("Enterprise," or the "Company") (TSX:E) is pleased to announce that the Company has signed a letter of intent to acquire a privately-owned oilfield site services rental company (the "Acquisition Target") based in Fort St. John, British Columbia. The purchase price will be based on the Acquisition Target's most recent financial statements which are in the process of being audited. The acquisition will be funded by a combination of Enterprise shares, cash, and vendor take-back financing.
Over the past ten years, the Acquisition Target has developed a highly-regarded full-service oilfield site infrastructure company that fulfills multiple equipment rental needs for a variety of oil and gas customers. The company's equipment fleet currently consists of approximately 350 owned pieces. This acquisition expedites Enterprise's plans to be operating three of its subsidiaries in Fort St. John by the fourth quarter of 2014. The owner of the Acquisition Target has agreed to sign a five-year management agreement with the Company.
Enterprise expects to complete the transaction in the month of September 2014. This completion will be subject to negotiation of a definitive share purchase agreement, the Company's finalization of satisfactory due diligence, and customary closing conditions.
"This acquisition will further accelerate Enterprise's emergence as a key player within the oilfield service industry," stated Leonard Jaroszuk, the Company's President and Chief Executive Officer. "The Acquisition Target is in many ways similar to Hart Oilfield Services, which we acquired in January of this year. The two companies offer similar services, and we anticipate that synergies between the two businesses will result in the creation of multiple cost-saving efficiencies. Furthermore, the Acquisition Target has relationships with several customers that Hart does not service."
"We strongly believe that the equipment rental market offers significant potential," concluded Mr. Jaroszuk. "Much of this potential centers around the Fort St. John region, a critical area in the development of Western Canada's LNG industry. Our acquisition of Hart has already demonstrated its value, both in the company's contribution to Enterprise's first quarter results and its recently announced major contract with Canada's largest natural gas producer. We are confident that this Acquisition Target offers similar potential, and will create immediate and accretive benefits for our business."
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. Enterprise acquired Artic Therm International Ltd. in September 2012, Calgary Tunnelling & Horizontal Augering Ltd. in June 2013, and Hart Oilfield Rentals Ltd. in January 2014.