TSX Venture Exchange Symbol "BRY"
EDMONTON, Sept. 2 /CNW/ - Bri-Chem Corp. ("Bri-Chem") (TSX Venture Exchange: BRY) a leading Canadian wholesale distributor of industrial drilling fluids, steel products and services, is pleased to announce that it has completed the acquisition of Weifang Steel Canada Ltd. ("Weifang"), a Western Canadian-based master wholesale distributor of steel products to the oil and gas and construction industries. The acquisition of Weifang is expected to add approximately $30 million in annual revenues to Bri-Chem and expand and diversify Bri-Chem's wholesale distribution business.
"We are very pleased to have completed this acquisition as Weifang adds further diversification to Bri-Chem's robust market area. We look forward to working together with the Weifang's management team in growing the business," comments Mr. Don Caron, Chairman of Bri-Chem,
Neil Rasmussen, Weifang's President, said, "We believe this transaction is a very good fit for our company and we are excited about our contribution to the future growth of Bri-Chem."
The total aggregate purchase price of $10,948,906 consists of $7,948,906 cash payable as to $4,948,906 on closing and $3,000,000 payable as to $1,000,000 60 days after the first anniversary of the close of the acquisition (the "Closing Date"), $1,000,000 60 days after the second anniversary of the Closing Date, and $1,000,000 60 days after the third anniversary of the Closing Date and $3,000,000 by way of the issuance of 1,304,348 common shares at a price of $2.30 per share. The vendors are also entitled to receive up to a $450,000 purchase price adjustment, subject to Weifang achieving a certain level of profitability to closing, to be determined and approved upon Bri-Chem receiving final interim closing financial statements of Weifang.
About Bri-Chem
Bri-Chem is a wholesale distributor of industrial drilling fluid supplies and steel products and services to the oil and gas and construction industries. Bri-Chem provides over 100 domestic and foreign drilling fluid products to customers throughout Alberta, British Columbia and Saskatchewan and distributes drill pipe, carbon steel welded pipe, carbon steel seamless pipe, stainless steel welded pipe, stainless steel seamless pipe, tubing & casing, sucker rods, galvanized steel products as well as fittings and flanges. Bri-Chem's customers operate in a wide range of industries, including oil & gas, manufacturing, forestry, agriculture, construction, and mining.
Forward Looking Statements
Certain statements contained in this press release, including statements which may contain words such as "could", "should", "expect", "anticipate", "believe", "will", and similar expressions and statements relating to matters that are not historical facts are forward looking statements. Such forward looking statements involve known and unknown risks and uncertainties which may cause the actual results, performances or achievements of Bri-Chem to be materially different from any future results, performances or achievements expressed or implied by such forward looking statements. Such factors include, but are not limited to, fluctuations in oil and gas activity levels, political and economic conditions, and the demand for products provided by Bri-Chem.
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.