TORONTO, Feb. 16, 2016 /PRNewswire/ - Exco Technologies
Limited (TSX-XTC) today announced that it has signed a
conditional purchase agreement to acquire a group of private
companies (the "Target") organized under the laws of Mexico and Michigan, whereby a wholly-owned U.S.
subsidiary of Exco intends to acquire all of the shares of the
Target.
The agreement is subject to receipt of applicable regulatory
approvals and other customary closing conditions, as well as the
finalization of certain due diligence items to Exco's satisfaction.
Exco currently anticipates the conditional elements will be
satisfied by March 31, 2016 with
closing of the transaction expected immediately following, although
there can be no assurance this will occur.
Pursuant to the terms of the agreement, the transaction value,
excluding assumed debt of US$4
million, totals approximately US$73
million. Assuming the transaction is completed, Exco intends
to fund this amount with a combination of cash on hand, part of the
proceeds from a new C$100 million
committed operating credit facility and notes payable to certain
shareholders of the Target, which are due over the subsequent three
years. The transaction will not require significant integration or
restructuring charges and is expected to be immediately accretive
to Exco's earnings per share. The Target generated revenue of
approximately C$115 million
(equivalent) in 2015.
Founded in the 1990's, the Target is a leading tier 2 supplier
of interior trim components to a diversified group of North
American automotive customers. Additional details, including the
name of the Target will be released after closing, until which time
they remain subject to a confidentiality agreement.
Exco has gained extensive leather and seat trim expertise over
the years, which has enabled it to develop its Automotive Solutions
Group into a globally competitive supplier in all manner of fabric,
vinyl and leather cut and sewn products. Exco believes the Target's
high quality operations are extremely complementary to its existing
automotive interior trim business but will also provide Exco with
new capabilities and customer relationships that are expected to
translate into additional growth opportunities over time.
Exco Technologies Limited is a global supplier of innovative
technologies servicing the die-cast, extrusion and automotive
industries. Through our 19 strategic locations in 10
countries, we employ 5,362 people and service a diverse and broad
customer base.
Any information in this news release relating to the
satisfaction of the conditions, the closing of the transaction or
the closing of the committed credit facility are forward-looking
statements.
Readers are cautioned not to place undue reliance on
forward-looking statements in this news release. These
forward-looking statements are based on our plans, intentions or
expectations which are based on, among other things, assumptions
about the outcome of due diligence which is continuing, possible
emergence of material adverse changes which may emerge, and
satisfaction of other conditions.
While Exco believes that the expectations expressed by such
forward-looking statements are reasonable, we cannot assure that
they will be correct. In evaluating forward-looking
information and statements, readers should carefully consider the
various factors which could cause actual results or events to
differ materially from those indicated in the forward-looking
information and statements. Readers are cautioned that the
foregoing list of important factors is not
exhaustive.
SOURCE Exco Technologies Limited