CALGARY, Alberta, July 31, 2017 (GLOBE NEWSWIRE) — Enerflex Ltd. (TSX:EFX), through its USA entity Enerflex Energy Systems Inc. (“Enerflex” or the “Company”), is pleased to announce today that it has completed its previously announced acquisition (the “Acquisition”) of the contract compression business of Mesa Compression, LLC (“Mesa”).
The transaction is consistent with Enerflex’s objective of increasing recurring revenue streams and expanding in the USA market while supporting the Company’s strategy of being a global supplier of turnkey energy solutions through compression, processing, and electric power equipment sales, after-market service, and contract operations.
Mesa is a supplier of contract compression services with operations in Oklahoma, Texas, and New Mexico. Key energy infrastructure assets acquired by Enerflex pursuant to the Acquisition includes 689 compression packages totaling approximately 112,000 horsepower, running at utilization levels above 85% and having an average fleet age of approximately 7 years. Over 50 employees and all members of Mesa’s senior operations team have joined Enerflex.
The Acquisition provides Enerflex with an established and growing contract compression platform in the USA with attractive margins and recurring revenue. It accelerates Enerflex’s ability to deliver full-cycle contract services in the region and provides the Company with increased coverage in the Permian and Scoop/Stack basins. The strategic fit between both organizations, the talented resources, and the growth opportunities will enhance the Company’s position in the contract compression business.
The Acquisition was financed through a combination of cash-on-hand and drawings on the Company’s existing syndicated credit facility.
Enerflex Ltd. is a single source supplier of natural gas compression, oil and gas processing, refrigeration systems, and electric power generation equipment – plus related engineering and mechanical service expertise. The Company’s broad in-house resources provide the capability to engineer, design, manufacture, construct, commission, and service hydrocarbon handling systems. Enerflex’s expertise encompasses field production facilities, compression and natural gas processing plants, refrigeration systems, and electric power equipment servicing the natural gas production industry.
Headquartered in Calgary, Canada, Enerflex has approximately 1,800 employees worldwide. Enerflex, its subsidiaries, interests in associates and joint-ventures operate in Canada, the United States, Argentina, Bolivia, Brazil, Colombia, Mexico, Peru, Australia, the United Kingdom, the United Arab Emirates, Oman, Bahrain, Indonesia, Malaysia, and Thailand. Enerflex’s shares trade on the Toronto Stock Exchange under the symbol “EFX”. For more information about Enerflex, go to www.enerflex.com.
Advisory Regarding Forward-Looking Statements
In the interest of providing readers with information regarding Enerflex, including management’s assessment of the future plans and operations of Enerflex, certain statements contained in this news release constitute forward-looking statements or information (collectively “forward-looking statements“) within the meaning of applicable securities legislation. Forward-looking statements are typically identified by words such as “anticipate”, “continue”, “estimate”, “expect”, “forecast”, “may”, “will”, “project”, “could”, “plan”, “intend”, “should”, “believe”, “outlook”, “potential”, “target” and similar words suggesting future events or future performance. In particular, this news release contains, without limitation, forward-looking statements pertaining to certain anticipated strategic benefits of the Acquisition.
With respect to forward-looking statements contained in this news release, Enerflex has made assumptions regarding, among other things: the ability of Enerflex to execute and realize on the anticipated benefits of the Acquisition; the value and benefits of the Acquisition; that the acquired business will perform in a manner consistent with past periods; that no contractual or other arrangements in respect of the acquired business will be amended, modified or terminated as a result of the Acquisition, or otherwise; expectations and assumptions concerning prevailing usage rates, exchange rates, interest rates, applicable tax laws; estimates of operating costs; anticipated timing and results of capital expenditures; the sufficiency of budgeted capital expenditures in carrying out planned activities; the state of the economy and the financial conditions of Enerflex’s and Mesa’s customers; results of operations; business prospects and opportunities; the availability and cost of financing, labor and services; the impact of increasing competition; the effect of seasonality fluctuations; the risk of violations of law, breaches of policies or unethical behavior; property and casualty risks; injuries at the workplace or health issues; the risk of material adverse effects arising as a result of litigation; and events or series of events may cause business interruptions.
Although Enerflex believes that the expectations reflected in the forward-looking statements contained in this news release, and the assumptions on which such forward-looking statements are made, are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned not to place undue reliance on forward-looking statements included in this news release, as there can be no assurance that the plans, intentions or expectations upon which the forward-looking statements are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections, and other forward-looking statements will not occur, which may cause Enerflex’s actual performance and financial results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, the following: volatility in market prices for oil and natural gas; incorrect assessment of the value of the Acquisition; risks inherent in operating in foreign and emerging markets; failure to realize the anticipated benefits and synergies of the Acquisition; the impact of general economic conditions; industry conditions, including the adoption of new laws and regulations and changes in how they are interpreted and enforced; volatility of oil and gas prices; oil and gas product supply and demand; risks inherent in the ability to generate sufficient cash flow from operations to meet current and future obligations, including future dividends to shareholders of the Company; increased competition; the lack of availability of qualified personnel or management; labour unrest; political unrest; fluctuations in exchange or interest rates; stock market volatility; opportunities available to, or pursued by, the Company; obtaining financing; and the other factors described under “Risk Factors” in Enerflex’s most recently filed Annual Information Form available in Canada at www.sedar.com. Readers are cautioned that this list of risk factors should not be construed as exhaustive.
The forward-looking statements contained in this news release speak only as of the date of this news release. Except as expressly required by applicable securities laws, Enerflex does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.
J. Blair Goertzen
President & Chief Executive Officer
D. James Harbilas
Executive Vice President & Chief Financial Officer