Business
Allen-Vanguard announces completion of acquisition of Hazard Management Solutions Ltd.
Allen-Vanguard announces completion of acquisition of Hazard Management Solutions Ltd..
About this update from Verisante Technology, Inc.
[{"type":"text","content":"\n\n\n\n- Favourable exchange rate reduces fixed acquisition cost by $2 million\n\n\n- HMS business on track to double fiscal 2007 revenue, EBITDA\n\n\nOTTAWA, June 13 /CNW Telbec/ - Allen-Vanguard Corporation (the "Company"\nor "Allen-Vanguard") (TSX: VRS) of Ottawa, Canada announced today that it has\ncompleted the previously announced acquisition of all the shares of Hazard\nManagement Solutions Ltd. and its wholly-owned U.S. subsidiary ("HMS").\n\n\nUnder the terms of the all-cash transaction, Allen-Vanguard paid\n$17.8 million at closing, and issued interest-bearing vendor loan notes in the\namount of $9.5 million, which are repayable in three annual installments\ncontingent on continued employment of the HMS principals, and which pay\ninterest of LIBOR plus 2%. Additional consideration assuming HMS achieves\nescalated EBITDA targets over a three- year period would equal $10.5 million.\nThere is also the potential for "super-achievement" consideration of up to a\nfurther $10.5 million if HMS exceeds its EBITDA targets by an average of 26%\nper annum over the three year period. All figures are expressed in\nCanadian dollars unless otherwise noted, based on the exchange rate of\n2.0965 Canadian dollars to one pound sterling, at which rate the Company\nexecuted the transaction. The acquisition was funded from Allen-Vanguard's\nshort-term investments.\n\n\nUnder the terms of the agreement, HMS net assets were to be $2.3 million\nat the closing date, with any excess or deficiency from this figure to be paid\nto or recovered from the principals of HMS. The Company expects to calculate\nthe amount of any HMS net asset adjustment and to determine the allocation of\npurchase consideration between identifiable assets and goodwill acquired in\ntandem with the results for its third quarter ended June 30, 2007.\n\n\n"We welcome the staff of HMS warmly to the Allen-Vanguard family," said\nDavid E. Luxton, President and CEO of Allen-Vanguard. "The market synergies\nbetween the two companies mean stronger value to customers and shareholders,\nwith solutions in the expanding counter-IED market that encompass\nintelligence, consultancy and training services from HMS alongside our\nadvanced technologies against all-hazards. The performance-based terms of this\ndeal reflect the high confid...