Investors: 2007 Press Releases
HSE To Acquire Prairie Wide Safety Of Weyburn, Saskatchewan
NEWS RELEASE - May 17, 2007
HSE Integrated Ltd. (“HSE” or the “Company”) is pleased to announce that it has entered into a non-binding Letter of Intent (“LOI”) to acquire the shares of Prairie Wide Safety Ltd. (“PWS”) of Weyburn, Saskatchewan. Serving the established and active hydrocarbon producing region of southeast Saskatchewan, PWS provides complete oilfield and industrial safety services to drilling, completion, well servicing and field processing operations in this region.
PWS was founded in 1995 and is owned by Ed Daer of Weyburn, who has been active in oilfield safety in southeast Saskatchewan since 1986. Because many of the producing fields in the Weyburn area contain toxic hydrogen sulphide gas, PWS started out providing breathing air safety services. In the past few years, however, PWS has expanded its suite of services to include gas detection, shower services, fire protection, on-site first aid, worker safety training and plant and facility shutdown safety services.
The total purchase consideration shall be approximately $2.2 million subject to adjustments based on the financial performance of PWS for the first 12 months of operations following its acquisition of HSE. The purchase consideration will be a combination of cash, assumption of debt, and the issuance 100,000 HSE shares.
Ed Daer, the principal, has agreed to stay with HSE for a minimum of 12 months following closing to ensure a smooth change of ownership and continuity of the high level of service PWS clients have come to depend upon. It is expected that all PWS employees, dayraters and contractors will be continue to be employed by HSE after closing of the transaction.
The acquisition of PWS is conditional upon several conditions precedent including completion of satisfactory due diligence, approval of the Board of Directors of HSE and the approval of the TSX Venture Exchange. The intention is to close the PWS acquisition as soon as possible.
PWS has a history of growth and profitability. Based on financial statements for the fiscal year ended August 31, 2006, PWS had normalized EBITDA exceeding $500,000 on revenues $1.6 million. The current fiscal year on track for similar performance.
David Yager, Chairman and CEO of HSE, had the following comments.
“Based on strong interest from HSE’s current client base, we’ve been examining a strategic geographic expansion into southeast Saskatchewan for some time. Prairie Wide is a another great example of the strong regional safety companies that do an excellent job for the clients in their area but are restricted in their growth opportunities because the owner has to do all the work himself with his own money. There is little overlap between the HSE and Prairie Wide clients. So the combination of our two operations will permit HSE to provide local service to its own customers, and provide a more diverse service package to the Prairie Wide clients. Based on the excellent success HSE has enjoyed when acquiring successful regional safety companies as a platform from which to introduce the entire HSE service package, we’re confident this will be a win-win proposition for everyone involved.”
HSE is Canada’s only national supplier of integrated industrial Health, Safety and Environmental services. From its head office in Calgary, Alberta HSE serves its clients from field service locations in Alberta, British Columbia, Ontario, Nova Scotia and Michigan. HSE trades on the TSX Venture Exchange under the symbol “HSL”.
Forward-Looking Statements
This news release may contain forward-looking statements concerning, among other things, the Company’s prospects, expected revenues, expenses, profits, financial position, strategic direction, and growth initiatives, all of which are subject to risks, uncertainties and assumptions. These forward-looking statements are identified by their use of terms and phrases such as expect, anticipate, estimate, believe, may, will, intend, plan, continue, project, objective and other similar terms and phrases. These statements are based on certain assumptions and analyses made by the Company based on its experience and assessment of current conditions, known trends, expected future developments and other factors it believes are appropriate under the circumstances. Such statements are subject to numerous external variables, both known and unknown, such as changes in commodity prices for natural gas and oil, changes in drilling activity, weather conditions, industry-specific and general economic conditions and exchange rate fluctuations. If any of these risks and uncertainties materializes or if assumptions are incorrect, actual results may differ materially from those expressed or implied in the forward-looking statements. The forward looking statements included in this news release are not guarantees of future performance and should not be unduly relied upon.
The TSX Venture Exchange has not reviewed and does not accept responsibility for the
adequacy or accuracy of this release.
For more information please contact:
David Yager, Chairman & CEO
Telephone: (403) 266-1833
E-Mail: