HALIFAX, Jan. 30, 2014 /CNW/ - Clarke Inc. ("Clarke") (TSX: CKI, CKI.DB.A) is pleased to announce that it has entered into
a definitive agreement to sell its commercial tank and home heating
business ("Gestion Jerico") to TerraVest Capital Inc. ("TerraVest"). The transaction values Gestion Jerico at an enterprise value of
$54.0 million. Clarke will receive $24.9mn for its 75% interest in
Gestion Jerico in the form of a 6.5% promissory note with a 3-year
term.
George Armoyan, Chief Executive Officer of Clarke stated: "We have
worked with Charles Pellerin and Pierre Fournier to grow Gestion Jerico
from its roots as a residential oil tank business to a diversified
residential and commercial tank business. The result is a diversified
tank business with multiple product lines and 20x the EBITDA as when we
acquired this business." Mr. Armoyan added: "We believe this
transaction strengthens TerraVest, part of which we own, by creating a
more diversified company, generating cross-selling opportunities and
other revenue synergies and providing Gestion Jerico with a base of
operations from which to expand into Western Canada. We wish Charles
and Pierre and the rest of the team all the best as they join the
TerraVest organization. We believe this transaction will greatly
benefit both companies."
The acquisition, which is expected to close in February 2014, is subject
to customary closing conditions for a transaction of this nature,
including acceptance and final approval by the Toronto Stock Exchange.
A material change report in respect of this acquisition will be filed
by Clarke but will not be filed earlier than 21 days prior to the
closing of the acquisition as Clarke wishes to complete the acquisition
as soon as commercially feasible once all necessary approvals have been
obtained.
Clarke remains focused on creating shareholder value, stream lining its
asset base and simplifying its financial statements. The divestiture
of Gestion Jerico helps accomplish these goals for Clarke, while
positioning TerraVest for growth. Following the close of this
transaction, Clarke continues to own its investment segment and the
ferry and container shipping units.
About Clarke
Halifax-based Clarke invests in a variety of private and publicly-traded
businesses and participates actively where necessary to enhance
performance and increase its return. Clarke's securities trade on the
Toronto Stock Exchange (CKI; CKI.DB.A); for more information about
Clarke, please visit our website at www.clarkeinc.com.
Forward-Looking Statements
This press release may contain or refer to certain forward-looking
statements relating, but not limited to, Clarke's expectations,
intentions, plans and beliefs with respect to Clarke, the use of the
proceeds of the transaction and the estimated gain and the increase in
book value per share as a result of the transaction. Often, but not
always, forward-looking statements can be identified by the use of
words such as "plans", "expects", "does not expect", "is expected",
"budget", "estimates", "forecasts", "intends", "anticipates" or "does
not anticipate", or "believes", or equivalents or variations, including
negative variations, of such words and phrases, or state that certain
actions, events or results, "may", "could", "would", "should", "might"
or "will" be taken, occur or be achieved. These forward-looking
statements include, but are not limited to, statements regarding the
trading price of the Company's securities not fully reflecting the
value of the Company's business, the estimated gain from the
transaction and the increase in book value per share as a result of the
transaction.
Forward-looking statements rely on certain underlying assumptions that,
if not realized, can result in such forward-looking statements not
being achieved. Forward-looking statements involve known and unknown
risks, uncertainties and other factors that could cause the actual
results of Clarke to be materially different from the historical
results or from any future results expressed or implied by such
forward-looking statements. Risks and uncertainties include, among
others, the Company's investment strategy, legal and regulatory risks,
general market risk, potential lack of diversification in the Company's
investments, and interest rates and foreign currency fluctuations. Although Clarke has attempted to identify important factors that could
cause actual actions, events or results or cause actions, events or
results not to be estimated or intended, there can be no assurance that
forward-looking statements will prove to be accurate as actual results
and future events could differ materially from those anticipated in
such statements. Other than as required by applicable Canadian
securities laws, Clarke does not update or revise any such
forward-looking statements to reflect events or circumstances after the
date of this document or to reflect the occurrence of unanticipated
events. Accordingly, readers should not place undue reliance on
forward-looking statements.
SOURCE Clarke Inc.
