Mullen Group Ltd. Announces Acquisition of Canadian Hydrovac Ltd.
OKOTOKS, Alberta, June 19, 2018 (GLOBE NEWSWIRE) -- (TSX:MTL) Mullen Group Ltd. ("Mullen Group", "We", "Our" and/or the
"Corporation") is pleased to announce that it has entered into a letter of intent to acquire the shares of Canadian Hydrovac Ltd. ("CHL" and/or the
"Company"). The transaction is expected to close on July 1, 2018, subject to the completion of conditions customary for a transaction of this nature and the approval of the
transaction by the Toronto Stock Exchange.
CHL is a private company owned by Dan Shemanchuk which is based in Sherwood Park, Alberta. CHL is an industry leader in providing hydrovac services to the midstream, pipeline, construction and municipal sectors of western Canada. In addition to operating from its head office in the refinery complex of the greater Edmonton region and Alberta's Industrial Heartland, CHL has additional operating branches in the Lower Mainland of British Columbia and Saskatchewan. The Company's workforce consists of approximately 80 skilled employees and its fleet consists of over 50 specialized pieces of equipment including: hydrovac units, vacuum units and various other pieces of support equipment.
"This acquisition is an excellent example of how our organization approaches acquisitions. Not only do we acquire an industry leader in a growth market, we now have a real opportunity to generate margin improvement from the synergies associated with combining the assets with our existing hydrovac and specialized combo units business in western Canada, including those that we will acquire with the recently announced AECOM purchase. I am very pleased that Dan Shemanchuk will continue to lead CHL. He has built a company based upon quality, customer service and safety by investing in first class operating equipment with a team of skilled and dedicated employees. Now with our balance sheet and strong market presence here in western Canada I feel confident that the CHL team under Dan's leadership will capitalize on many future opportunities," commented Mr. Murray K. Mullen, Chairman and Chief Executive Officer.
Mullen Group will operate CHL as a standalone Business Unit within our Oilfield Services segment and this acquisition is expected to add approximately $25.0 million in annual revenue to Mullen Group with margins consistent with our Specialized Services Business Units within the Oilfield Services segment. Mullen Group will fund this transaction through cash and the issuance of Mullen Group shares. With the recently announced acquisition of AECOM's Canadian Industrial Service Division, combined with our Recon Utility Search L.P. and Cascade Energy Services L.P. Business Units, Mullen Group will have one of the largest fleets of hydrovacs in western Canada.
This news release may contain forward-looking statements that are subject to risk factors associated with the oil and natural gas business and the overall economy. Mullen Group believes that the expectations reflected in this news release are reasonable, but results may be affected by a variety of variables. The forward-looking information contained herein is made as of the date of this news release and Mullen Group disclaims any intent or obligation to update publicly any such forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable Canadian securities laws. Mullen Group relies on litigation protection for "forward-looking" statements.
Mullen Group is a company that owns a network of independently operated businesses. The Corporation is recognized as one of the leading suppliers of trucking and logistics services in Canada and provides a wide range of specialized transportation and related services to the oil and natural gas industry in western Canada - two sectors of the economy in which Mullen Group has strong business relationships and industry leadership. The corporate office provides the capital and financial expertise, legal support, technology and systems support, shared services and strategic planning to its independent businesses.
Mullen Group is a publicly traded corporation listed on the Toronto Stock Exchange under the symbol "MTL". Additional information is available on our website at www.mullen-group.com or on SEDAR at www.sedar.com.
For further information, please contact:
Mr. Murray K. Mullen - Chairman of the Board, Chief Executive Officer and President
Mr. P. Stephen Clark - Chief Financial Officer
Mr. Richard J. Maloney - Senior Vice President
121A - 31 Southridge Drive
Okotoks, Alberta, Canada T1S 2N3