NANAIMO,
BC, Sept. 16, 2024 /CNW/ - Atlas Engineered
Products ("Atlas", "AEP" or the "Company") (TSXV: AEP) (OTC
Markets: APEUF) announces that the Company has completed due
diligence for a truss manufacturing company located in Western Canada (the "Target") and intends to
close the transaction in early Spring of 2025.
"We are excited to announce the completion of due
diligence for the Target. This is the most robust M&A pipeline
we have ever seen and now is the time to move forward with
strategic acquisitions that expands our reach into new locations as
we continue to grow our national footprint," said Hadi Abassi, CEO
& President, Founder. "We are progressing with acquisitions and
steadily advancing our organic growth initiatives, including
robotic implementation. Recently, we have expanded our sales team
to capture more market share and enhance our sales presence in the
U.S. market. These approaches ensure our continuous growth and
expansion, aligning with both our short-term and long-term
strategic goals."
The Company will now start working on a share purchase agreement
where AEP intends to acquire all the issued and outstanding shares
of the Target (the "Proposed Transaction") for the purchase price
of $3.8 million in cash and stock,
plus a working capital adjustment to be determined and finalized
after closing of the transaction. The land and buildings on which
the Target's facilities are located will be leased from the current
owners and terms will be finalized while working on the share
purchase agreement. The Target generated a previous 3-year average
revenues of over $11 million, net
income of approximately $950,000 and
non-IFRS measure adjusted EBITDA of approximately $1.15 million (see "Non-GAAP/Non-IFRS Financial
Measures"). This Proposed Transaction will potentially be financed
using a combination of the Company's existing cash, common shares
of the Company issued to the vendor, and bank financing. AEP is
currently assessing which combination of financing is the best
strategically for the short- and long-term growth plans of the
Company.
This Proposed Transaction is aligned with the Company's
strategic acquisition plan and expands our geographical reach. AEP
will bring its considerable operating synergies and material buying
power to this anticipated new addition to the AEP group of
companies.
The Company will release more details at time of closing of the
Proposed Transaction which is targeted for early Spring of 2025.
Closing of the Proposed Transaction also remains subject to a
number of conditions, including the approval of the TSX Venture
Exchange (the "Exchange"), if such approval is required under the
rules and policies of the Exchange.
Non-GAAP / Non-IFRS Financial Measures
Certain financial measures in this news release do not have any
standardized meaning under IFRS and, therefore are considered
non-IFRS or non-GAAP measures. These non-IFRS measures are used by
management to facilitate the analysis and comparison of
period-to-period operating results for AEP and to assess whether
AEP's operations are generating sufficient operating cash flow to
fund working capital needs and to fund capital expenditures. As
these non-IFRS measures do not have any standardized meaning under
IFRS, these measures may not be comparable to similar measures
presented by other issuers. The non-IFRS measures used in this news
release may include "EBITDA", "EBITDA margin", "adjusted EBITDA",
"adjusted EBITDA margin", "normalized EBITDA" and "normalized
EBITDA margin". For a description of the composition of these
measures, please refer to AEP's Management's Discussion and
Analysis for the period ended March 31,
2023 under "Non-IFRS / Non-GAAP Financial Measures",
available on AEP's website at www.atlasengineeredproducts.com
or on SEDAR at www.sedar.com.
About Atlas Engineered Products Ltd.
AEP is a growth company that is acquiring and operating
profitable, well-established operations in Canada's truss and engineered products
industry. We have a well-defined and disciplined acquisition and
operating growth strategy enabling us to scale aggressively and
apply new technologies, giving us a unique opportunity to
consolidate a fragmented industry of independent operators.
www.atlasengineeredproducts.com
FORWARD LOOKING INFORMATION
Information set
forth in this news release contains forward-looking statements.
These statements reflect management's current estimates, beliefs,
intentions and expectations; they are not guarantees of future
performance. Although AEP believes that the expectations reflected
in the forward looking statements are reasonable, there is no
assurance that such expectations will prove to be correct, or that
such future events will occur in the disclosed time frames or at
all. AEP cautions that all forward looking statements are
inherently uncertain and that actual performance may be affected by
a number of material factors, many of which are beyond AEP's
control. Such factors include, among other things: risks and
uncertainties related to the housing market, changes in interest
rates and other risks and uncertainties relating to AEP,
including those described in the Management's Discussion and
Analysis ("MD&A") for AEP's three and six months ended
June 30, 2024. Accordingly, actual
and future events, conditions and results may differ materially
from the estimates, beliefs, intentions and expectations expressed
or implied in the forward-looking information. Except as required
under applicable securities legislation, AEP undertakes no
obligation to publicly update or revise forward-looking
information.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES
PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX
VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR
ACCURACY OF THIS RELEASE.
SOURCE Atlas Engineered Products Ltd.