/NOT FOR DISTRIBUTION TO U.S NEWSWIRE SERVICES OR
FOR DISSEMINATION IN THE UNITED
STATES/
MONTREAL, March 15, 2019 /CNW Telbec/ - Ecolomondo
Corporation (TSXV: ECM) (the "Company" or "Ecolomondo")
is pleased to announce that it has entered into a conditional
purchase agreement with respect to the acquisition of Gestion
Transport Lyon Inc. ("Transport Lyon") by a combination of share issuance
and working capital contribution into Transport Lyon (the
"Transaction").
The closing of the contemplated Transaction, subject among other
conditions to satisfactory legal and financial due diligence, is
expected to take place by April 30,
2019. Once completed, Transport Lyon will become a
wholly-owned subsidiary of Ecolomondo and should immediately
contribute significant revenues to Ecolomondo.
Transport Lyon is a large
Montreal-based transport company
that offers specialized transportation and is an authorized
collector of used tires for the government agency
Recyc-Quebec. Transport Lyon owns and operates a large fleet
of vehicles, provides quality service and has an enviable
reputation in the transport industry.
Vertical integration of Transport Lyon will bring to Ecolomondo
a strong market presence and solidify its position in the scrap
tire industry in Quebec.
Ecolomondo's growth strategy is to be a full service company,
from collection, shredding to processing of scrap tire waste to
recover resources to be re-used by industry.
Management believes that vertical integration of scrap tire
transporters and recyclers by Ecolomondo will allow Thermal
Decomposition Process ("TDP") turnkey plants to secure
increased feedstocks, higher tipping fees and reduce costs by
taking advantage of economies of scale and improved efficiency.
The Transaction
The Transaction does not result in a change in control of the
Company, as defined in applicable securities laws, is made at arm's
length and no finder's fee is payable under the Transaction.
Based on the terms and conditions provided in the offer to
purchase, the Company will inject upon closing an amount
C$700,000 of working capital into
Transport Lyon. A further amount of C$1,400,000 will be paid by the Company as
follows: C$300,000 worth of
Ecolomondo stock, C$100,000 in other
compensation and a balance of sale of C$1,000,000 to be repaid from future profits
(using a formula of 25% of profits above C$250,000 per year), starting with the financial
results for the period ending October 31,
2021.
As part of the Transaction, Ecolomondo will assume C$ 2,050,000 of long term debt that was taken
mostly for the purchase of new vehicles, bringing the total
commitments of the transaction to C$ 4.15
million.
For the fiscal years ended October 31,
2018 and 2017, Transport Lyon had revenues of C$11.2 and C$11.8
million, generated profits after taxes of C$187,000 and C$700,000, and had EBITDA of C$1.07 and C$1.61
million, respectively.
Upon closing of the Transaction, current management of Transport
Lyon is expected to remain in place with Simon Choquette to continue as Chief Executive
Officer.
Closing of the Transaction is subject to various conditions,
including but not limited to the completion of a definitive share
purchase agreement and TSX Venture Exchange approval.
About Ecolomondo Corporation
Ecolomondo is a cleantech Canadian company that is
commercializing its waste-to-products technology. The Thermal
Decomposition Process ("TDP") converts hydrocarbon waste
into marketable commodity end-products, namely carbon black
substitute, oil, gas and steel. Technologies such as Ecolomondo's
are expected to play an important role in resource recovery needed
in today's circular economy.
Management believes that technological breakthroughs in areas of
emissions, process optimization, automation, end-product processing
and safety, position Ecolomondo to become an industry leader.
The Company's main revenues will come from the sale of TDP
turnkey facilities and royalties from their operations. TDP
facilities will generate revenues from the sale of end-products,
tipping fees and carbon credits. Ecolomondo's first focus is to
market TDP turnkey facilities that use scrap tires as a feedstock,
because scrap tires yield end-products with a higher commercial
value, especially the recycled carbon black.
Cautionary Note Regarding Forward Looking Statements
The information in this news release includes certain
information and statements about management's view of future
events, expectations, plans and prospects that constitute forward
looking statements. These statements are based upon assumptions
that are subject to significant risks and uncertainties. Because of
these risks and uncertainties and as a result of a variety of
factors, the actual results, expectations, achievements or
performance may differ materially from those anticipated and
indicated by these forward looking statements. Although Ecolomondo
believes that the expectations reflected in forward looking
statements are reasonable, it can give no assurances that the
expectations of any forward looking statements will prove to be
correct. Except as required by law, Ecolomondo disclaims any
intention and assumes no obligation to update or revise any forward
looking statements to reflect actual results, whether as a result
of new information, future events, changes in assumptions, changes
in factors affecting such forward looking statements or
otherwise.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
www.ecolomondo.com
SOURCE Ecolomondo Corp