Newalta Enters Into Agreement to Sell Industrial Division for $300 Million and Announces 2015 Capital Budget - Seite 2

The sale of the Industrial Division will drive focus and funding to support growth in Newalta's New Markets and Oilfield divisions. Newalta intends to use the proceeds to capitalize on its strong market position and further strengthen the balance sheet. Proceeds from the sale will immediately be used to pay down debt and reduce net debt leverage to below 2x Adjusted EBITDA at the close of the transaction. Net debt is comprised of $275 million in outstanding unsecured debentures, net of excess cash after reducing the draw on its credit facility. In addition, proceeds will support investment in organic growth opportunities. Newalta will continue to actively pursue acquisitions where the company can add meaningful value and further advance its business strategy.

The transaction is subject to satisfaction of customary closing conditions, as well as regulatory approvals, and is expected to close in the first quarter of 2015. RBC Capital Markets and Bennett Jones LLP acted as financial and legal advisors, respectively, to Newalta on this transaction.

2015 Capital Plan

Newalta's 2015 capital budget is $190 million, comprised of $165 million in growth capital and $25 million in maintenance capital expenditures. While proceeds from the sale of the Industrial Division will provide the opportunity to increase capital expenditures, Newalta will remain measured in its approach towards capital spending in 2015 and will continue to monitor market activity. Growth capital will be prioritized and allocated towards the $50 million in carryover projects initiated in 2014 as well as those capital projects supporting contract opportunities. Carryover projects include Newalta's new full scale Heavy Oil facility in Fort McMurray, Alberta, new oilfield satellite facilities in both Canada and the U.S., and an additional drill cuttings treatment unit. All carryover projects are expected to be commissioned and contributing cash flow in 2015. The 2015 capital program will be funded from both funds from operations and proceeds from the sale of the Industrial Division.

"We continue to see excellent opportunities to invest in profitable growth across our business, however, we will be disciplined in our approach to committing to capital and responsive to our customers' needs," said Barkhouse. "Investments from 2014 will drive growth in 2015, while our investments in 2015 will contribute to strong, profitable growth in 2016 and the years ahead."