04.06.2013

Entrec acquires GT’S

Alberta, Canada based Entrec Corporation has signed a definitive agreement to acquire GT's Crane and Transportation Services of Grande Prairie, Alberta.

GT's operates 45 cranes and a hauling operation from five locations in Alberta and British Columbia - Grande Prarie, Dawson Creek, Fort Nelson, Leduc and Whitecourt and employs around 180.

The company has made substantial investments over the past two years, reducing the average age of its fleet to under four years with a market value in the region of $37 million and revenues in the region of $50 million.
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One of GT's All Terrain cranes

Once the deal closes GT’s president Greg Toews will be appointed executive vice president operations, overseeing Entrec’s operations in Northwest Alberta and Northeast B.C.

The deal includes just over nine million new shares in Entrec, plus $37,223,380 in cash and an unsecured promissory note of $7.3 million with an interest rate of 7.25 percent and maturity date of July 2nd 2016. Entrec will use its senior credit facilities to finance the cash portion of the purchase price and will not assume any long-term debt. The company expects to achieve annual economies in the region of $3 million through merging locations and combining back office functions.

The price will also be subject to adjustment based on GT's EBITDA for the 12 months to the end of June, with closing expected at the start of July.
Entrec operates around 160 mobile cranes including All Terrains, Crawlers, Rough Terrains, truck cranes and boom trucks. It has 11 locations in Alberta, British Columbia and North Dakota, USA. Revenues for 2012 almost tripled to $132.5 million.

The company says that in light of the acquisition it will divert around $6 million from its transport equipment capital expenditure budget to its budget for new cranes and self-propelled modular trailers SPMTs. It now expects to spend around $53 million this year, of which $29 million will go on new cranes for the fleet.

Entrec president John Stevens said: "We are pleased to welcome GT's to the Entrec team. GT's has a reputation for strong customer service in the regions it serves, and comes with an excellent management team and experienced employee base. With the combined operations of Entrec and GT's, we believe we will be well positioned to capture a significant portion of planned future investments in Liquefied Natural Gas driven infrastructure within these regions.”

“This is in addition to the strong market position we already enjoy in Northwest B.C. where many of the proposed LNG facilities will be constructed. The acquisition is also expected to be immediately accretive to our earnings per share for fiscal 2013, even before accounting for significant annual operating synergies."

Entrec began as Schell Equipment in 1995, was then acquired by Transco which was itself acquired by Flint in 2006, changing its name to Entrec in 2008. The company was purchased from Flint Energy by EIS Capital Corp in May 2011.