Aecon to buy Lockerbie for CA$ 220 million

By Richard High03 February 2009

Aecon, one of Canada's largest construction groups, has agreed to acquire Lockerbie & Hole, one of the largest mechanical construction contractors in the country, for CA$ 220 million (US$ 178.3 million).

The acquisition will allow it to expand into mechanical/electrical and water/wastewater markets in Western Canada.

Under the terms of the deal, Lockerbie shareholders will get CA$ 8.00 (US$ 6.42) in cash or Aecon shares, or a combination of both. The price is a 30% above Lockerbie's Friday closing price of CA$ 6.15 (US$ 4.94) on the Toronto Stock Exchange.

Aecon said about 75% of the deal will be paid in cash and 25% will be paid in stock.

On completion, Lockerbie's chief executive Gordon Panas will join Aecon as the Chief Financial Officer.

Aecon said it will finance the deal without any debt, through cash payment and issuance of about CA$ 55 million (US$ 44.2 million) in shares.

Lockerbie & Hole had revenues of CA$ 402 million (US$ 322 million) in 2008 and a net income of CA$ 23.2 million (US$ 18.6 million).

It has nine offices and five fabrication facilities across Canada and employs 2500 people. The combined company will employ approximately 9000 people.

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