Enerflex Announces Strategic Acquisition of a US Based Contract Compression Business for U$106 Million

• Adds compression fleet of approximately 112,000 hp generating stable, repeatable, and high margin revenue and increases Enerflex’s global contract compression fleet to over 600,000 hp.
• Increases Enerflex’s geographic footprint and concentration of revenue in the Permian and Scoop/Stack basins within the United States – one of the fastest growing natural gas markets.
• Aligns and supports Enerflex’s strategic goal of increasing ownership of natural gas handling assets.
• Increases Service and Rental revenue in the USA and moves Enerflex closer to its strategic objective of 35% - 40% recurring revenue.
• Business generated revenue of approximately U$25.7 million for the year ended December 31, 2016.
• Transaction will be financed through drawings on our credit facility and cash on hand, resulting in a Net Debt to Trailing-Twelve Month EBITDA ratio of 1.8 times at closing.
• Transaction is expected to be immediately accretive to EPS.

CALGARY, Alberta, June 19, 2017 (GLOBE NEWSWIRE) -- Enerflex Ltd. (TSX:EFX), through its USA entity Enerflex Energy Systems Inc. (“Enerflex” or the “Company”), announced today that it has entered into a definitive agreement to acquire the compression business of Mesa Compression, LLC (“Mesa”) for U$106 million in cash, subject to certain purchase price adjustments (“Acquisition”).

The transaction is consistent with Enerflex’s objective of increasing recurring revenue streams and expanding in the USA market while supporting the Company’s strategy of being a global supplier of turnkey energy solutions through compression, processing, and electric power equipment sales, after-market service, and contract operations.

“This acquisition provides Enerflex with an established and growing contract compression platform in the USA with attractive margins and recurring revenue. It accelerates our ability to deliver full-cycle contract services in the region and provides Enerflex with increased coverage in the Permian and Scoop/Stack basins,” said J. Blair Goertzen, Enerflex’s President and Chief Executive Officer. “The strategic fit between both organizations, the talented resources, as well as the growth opportunities will enhance the Company’s position in the contract compression business.”