Enterprise Group Inc. has completed the acquisition of Westar Oilfield Rentals Inc. in a deal worth US$ 13.5 million. The purchase price will be satisfied through a combination of US$ 10 million in cash, US$ 2 million in Enterprise shares (2.5 million shares at a price of US$ 0.80 per share), and US$ 1.5 million in vendor take-back financing, which will be paid over the next two years.
Westar is a full-service oilfield site infrastructure company that fulfills multiple equipment rental needs for a variety of oil and gas customers. This acquisition expedites Enterprise's plans to be operating three of its subsidiaries in Fort St. John by the end of the year. Westar's owner has also agreed to sign a five-year management agreement with the Company.
Enterprise believes that synergies between Westar and the company's existing subsidiaries will allow for both a rapid integration of this new business and the creation of significant operating efficiencies.
Enterprise plans to devote approximately US$ 3 million towards further expansion of Westar's existing equipment fleet, which currently consists of nearly 400 owned pieces.
Leonard Jaroszuk, the Enterprise’s President and CEO, said: "We are very pleased to complete our acquisition of Westar, which further establishes Enterprise's position as a central player within Western Canada's oilfield service industry.
"Westar also provides Enterprise with a strong foothold in the Fort St. John region, the centre of Western Canada's burgeoning LNG industry […] This acquisition provides us with a base of operations in Fort St. John, and we intend to further develop this base by opening local offices for three of our other subsidiaries by the conclusion of this year.”
Adapted from press release by Callum O'Reilly
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/16102014/enterprise-acquires-westar-1604/