ATLAS ENGINEERED PRODUCTS LTD. (TSX-V: AEP) has enterd into a definitive agreement to acquire Coastal Windows Ltd. Atlas has agreed to pay a total of $650,000, consisting of $400,000 in Atlas common shares and $125,000 in cash on closing, and $125,000 in cash one month after closing.
Also, Atlas is please to annouce to complete the acquision of Satellite Truss.
VANCOUVER, British Columbia, Aug. 02, 2018 — ATLAS ENGINEERED PRODUCTS LTD. (“Atlas” or the “Company”)(TSX-V: AEP), a leading supplier of trusses, engineered wood products and building components, is pleased to announce that it has entered into a definitive agreement to acquire all the issued and outstanding shares of Coastal Windows Ltd. (“Coastal”) of Nanaimo, BC. In addition, Atlas is pleased to announce that it has completed the acquisition of all the issued and outstanding shares of Satellite Truss Ltd. (“Satellite Truss”) of Merrickville, Ontario. Acquisition of Coastal Windows Regarding the purchase of Coastal Windows, Mr. Guy Champagne, President of Atlas stated, “The Coastal acquisition is very important to Atlas at this time. Coastal has perfected a small-footprint and high-quality window manufacturing operation that Atlas will replicate in all its operating regions across Canada. It builds on our long-term commitment to supply our construction industry partners with the full array of components and assemblies they might require for their projects – from design to lockup.”
To acquire Coastal, Atlas has agreed to pay a total of $650,000, consisting of $400,000 in Atlas common shares and $125,000 in cash on closing, and $125,000 in cash one month after closing. The Atlas common shares to be issued will be based on a 20-day volume weighted average price prior to the date of signing the purchase agreement. Coastal revenues for the twelve months ended June 30th, 2017 were approximately $1.7 million with adjusted EBITDA of $110,000 and is expected to have a net working capital of approximately $250,000 at closing. The assets of Coastal included in the transaction consist of equipment having an independently appraised value of $246,000 and intangible assets consisting of use licenses and permits related to the windows manufactured by Coastal having an internally assessed value of approximately $150,000.
The current CEO of Atlas, Mr. Hadi Abassi is the sole shareholder of Coastal. Due to the non-arms-length nature of this transaction, it has been reviewed and approved by the Atlas Board of Directors prior to closing. Closing of Satellite Truss Acquisition Satellite Truss is situated in a rapidly growing suburb of Ottawa which holds excellent potential for growth both for the truss business as well as component sales that will become possible as the Company continues to diversify its product mix. The Satellite Truss acquisition is expected to add accretive annualized revenues between the $1.5 million achieved for the yearending October 31st and $2.1 million targeted for the next 12 months. The acquisition is also expected to contribute accretive annualized EBITDA margin between the $130,000 achieved for the year-ending October 31st and $350,000 targeted for the next 12 months.
Atlas paid $1.2 million in cash for Satellite Truss in a transaction which includes tangible assets of $590,000 for land and buildings, $212,000 for equipment, and $300,000 in working capital. The purchase price is being financed using a $442,500 term loan, a $212,800 equipment lease, and the balance in cash from the Company’s reserves.
About Atlas Engineered Products Ltd.
Atlas Engineered Products Ltd. is a leading supplier of trusses and engineered wood products. Atlas was formed over 18 years ago and operates manufacturing and distribution facilities in British Columbia, Ontario and Alberta to meet the needs of residential and commercial builders. Atlas has expert design and engineering teams, multiple-shift state-of-the-art truss manufacturing operations, and large inventories of engineered beam and flooring components. Atlas aims to grow its base of business across Canada by pursuing an aggressive acquisition and consolidation and product diversification strategy. Atlas will bring its construction industry partners across Canada unparalleled excellence in service, product, and support and is committed to supplying them with the full array of components and assemblies they might require for their projects – from design to lockup.
For further information please contact:
Atlas Engineered Products Ltd.
Guy Champagne, President
2005 Boxwood Rd.
Nanaimo, BC V9S 5X9
For investor relations please contact:
Contact Financial Corp.
810 – 609 Granville St.
Vancouver, BC V7Y 1G5