Nov 30 2010
Essex Rental Corp. (Nasdaq: ESSX; ESSXW; ESSXU) ("Essex") today announced that it successfully completed its acquisition of the assets and business of privately-held Coast Crane Company (“Coast”).
Essex management held a conference call to discuss the Coast acquisition on November 17, 2010. An archived version of this conference call is available via webcast and may be accessed at http://investor.essexcrane.com/events.cfm.
Essex will operate the predecessor Coast business through a new, wholly-owned subsidiary, called Coast Crane Company. The Coast business will be operated independently of Essex’s existing operating business, Essex Crane Rental Corp. (“Essex Crane”). Coast’s management team will continue to be led by Dan Goodale, the CEO of Coast’s predecessor.
Essex paid approximately $80 million for Coast’s assets, approximately $48 million of which is being financed by a new $75 million, four–year, interest only, non-amortizing senior credit facility. Essex also assumed approximately $12 million of predecessor Coast indebtedness. The acquisition price reflects a significant discount to the replacement value of Coast’s assets. For the twelve months ended September 30, 2010, Coast generated revenues of approximately $85 million, based on Coast’s unaudited financial information for such period. Essex expects the operations of Coast to be meaningfully accretive to Essex’s 2011 free cash flow per share and as of the closing is accretive to net asset value per share.
Ron Schad, President and Chief Executive Officer of Essex, commented, “The acquisition of Coast broadens our product offering to include assets that are contiguous and complementary to our existing fleet of crawler cranes, expands our geographic reach into Western North America, Alaska, Hawaii, Guam and the South Pacific, and adds a proven, respected group of industry professionals to our management and operating teams. In combination with what we believe are improving conditions in our end markets, we expect that these factors will allow us to leverage the meaningful customer and project overlap that the two companies share, and drive higher asset utilization. We are very excited about the acquisition of Coast and the opportunities that lie ahead.”
Mr. Goodale added, “We are confident that Coast is well-positioned to maintain, and, over time, significantly expand, its industry leadership position. We remain unwavering in our commitment to our customers, employees, and other stakeholders, and look forward to working with Essex to build upon our 40-year history of specialization, innovation and success.”
Source: http://www.essexcrane.com