/NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED
STATES/
EDMONTON, AB, Aug. 31, 2020 /CNW/ - Wolverine Energy and
Infrastructure Inc. ("Wolverine" or the "Company")
(TSXV: WEII) is pleased to announce the filing of its Fiscal First
Quarter 2021 Results on SEDAR and a strategic US industrial
acquisition.
INDUSTRY OUTLOOK
For the quarter ending June 30,
2020, operations throughout North
America remained depressed largely resulting from an
unprecedented global pandemic; albeit Wolverine's first fiscal
quarter is typically its slowest due to spring breakup in
Western Canada. That being said,
Wolverine's diverse business model in Western Canada and the United States, has allowed the Company to
realize fairly strong activity levels in both its: (i) water
disposal and custom crude treating service lines; and (ii)
infrastructure division, which is focused on heavy equipment
rentals to major projects such as the Coastal GasLink pipeline
construction.
Moving forward in fiscal 2021, Wolverine does not expect major
changes in activity levels until the fiscal third quarter of 2021.
However, Wolverine's production testing and surface rental
divisions are well positioned to benefit from increased activity
levels across North America once
producers restart shut-in production. In the interim, Wolverine has
good visibility in both its water disposal and custom crude
treating segments and infrastructure division.
Wolverine continues to be strongly positioned to consolidate the
North American energy services and water midstream sectors.
Wolverine continues to evaluate strategic acquisitions focused on
key segments of the oil and gas market, including water management,
midstream and the completions sector of the markets. If the
prolonged challenges in the Western Canadian energy market, and the
slow down in United States oil and
gas activity, did not solely further increase the need for service
sector consolidations, the COVID-19 pandemic has. Wolverine's
management continues to believe that overheads throughout the
sector can be reduced and that less competition will help the
sector to return to a healthier position. Wolverine is
conservatively optimistic that the previous headwinds to getting
deals completed and substantial resistance by existing management
teams to consolidation, will be reconsidered during these
unprecedented times and is confident this will lead to
consolidation opportunities crystalizing through the back half of
calendar 2020 and into 2021.
Wolverine believes that the Company's strong financial position,
long term strategic financial lenders and diverse long-term
customer base position it to be an industry leader in consolidating
the highly fragmented energy services space in Western Canada and take advantage of
strategic, synergistic acquisition opportunities.
STRATEGIC RENEWABLES AND INFRASTRUCTURE ACQUISITION
OVERVIEW
Wolverine is excited to announce the signing of an asset
purchase agreement to acquire a strategic renewables and
infrastructure crane business in the
United States for total proceeds of C$33.5 million. The purchase is through an SISP
transaction and has obtained Canadian Court approval.
The transaction opens Wolverine's business to a full spectrum of
renewable energy and infrastructure crane services throughout
North Dakota, Colorado and Texas, and is one of the largest crane
operations in the United States,
with a fleet of approximately 50 Cranes and 195 Trailers. The
transaction creates strong synergies with Wolverine's current US
operations and dramatically increases the Company's exposure to
renewable energy and infrastructure. The purchased fleet carries a
fair market value (FMV) of approximately C$54.8 million; as per third party appraisal
values.
Jesse Douglas, President and CEO,
states "Wolverine is excited to continue our investment in clean
energy initiatives, especially those with an infrastructure focus.
We are extremely happy to gain this exposure and continue achieving
deep value investments for our stakeholders".
Wolverine has partnered with Great Rock Capital Partners to fund
the acquisition in addition to the current working capital of
Wolverine. The acquisition is expected to close around October 1, 2020 following court approval in
the United States and typical
closing processes.
About Wolverine
Wolverine is an industry-leading, diversified energy and
infrastructure service provider in western Canada and the
United States, providing a wide range of services including:
water management, production testing, oilfield/energy rentals, and
environmental services (waste disposal and custom crude treating).
Wolverine's original business roots and operations began in 1952.
Over the course of its history, the Wolverine group of companies
have pursued a strategy combining organic growth and strategic
acquisitions. Today, Wolverine is strongly positioned to
consolidate a highly-fragmented energy services and midstream
market in western Canada, and is
diligently focused on return on capital deployed, market
diversification, and maintaining best-in-class services throughout
the full life cycle of its diverse clients' projects.
Cautionary Statements
This news release contains forward-looking statements and/or
forward-looking information (collectively, "forward-looking
statements") within the meaning of applicable securities
laws. The forward looking statements can be identified by the
use of such words as "will", "expected", "approximately", "may",
"could", "would" or similar words and phrases.. Such
forward-looking statements reflect the current views of Wolverine
with respect to future events, and are subject to certain risks,
uncertainties and assumptions. Many factors could cause Wolverine's
actual results, performance or achievements to be materially
different from any expected future results, performance or
achievement that may be expressed or implied by such
forward-looking statements. In particular, this news release
contains or implies forward-looking statements pertaining to:
statements regarding: the Company's intention to close the SISP
transaction, regulatory approval, transaction financing matters,
industry outlook and divisional and corporate future results, and
any timelines as it relates to closing of the SISP transaction.
These forward-looking statements are subject to numerous risks and
uncertainties, including but not limited to: the impact of general
economic conditions in Canada and
the United States; industry
conditions including changes in laws and regulations including
adoption of new environmental laws and regulations, and changes in
how they are interpreted and enforced, in Canada and the
United States; competition; lack of availability of
qualified personnel; obtaining required approvals of regulatory
authorities, in Canada and
the United States; volatility in
market prices for oil and gas; fluctuations in foreign exchange or
interest rates; environmental risks; changes in income tax laws or
changes in tax laws and incentive programs relating to the oil
industry; ability to access sufficient capital from internal and
external sources; and other factors, many of which are beyond the
control of the Company.
These forward-looking statements reflect material factors,
expectations and assumptions. Forward-looking statements
included in this news release should not be read as guarantees of
future performance or results. Such statements involve known and
unknown risks, uncertainties and other factors that may cause
actual results, performance or achievements to be materially
different from those implied by such forward-looking
statements. Although the forward-looking statements contained
in this document are based upon assumptions which management of the
Company believes to be reasonable, the Company cannot assure
investors that actual results will be consistent with these
forward-looking statements. Wolverine's business is subject to a
number of risks and uncertainties. Readers are encouraged to review
and carefully consider the risk factors pertaining to Wolverine's
business described in the Company's management information circular
and annual management discussion and analysis, which is accessible
on Wolverine's SEDAR issuer profile at www.sedar.com. The
forward-looking statements contained in this release are made as of
the date of this release, and except as may be expressly be
required by law, Wolverine disclaims any intent, obligation or
undertaking to publicly release any updates or revisions to any
forward-looking statements contained herein whether as a result of
new information, future events or results or otherwise, other than
as required by applicable securities laws.
Management of the Company has included the above summary of
assumptions and risks related to forward-looking information
provided in this document in order to provide shareholders with a
more complete perspective on Wolverine's current and future
operations and such information may not be appropriate for other
purposes. Wolverine's actual results, performance or achievement
could differ materially from those expressed in, or implied by,
these forward-looking statements and, accordingly, no assurance can
be given that any of the events anticipated by the forward-looking
statements will transpire or occur, or if any of them do, what
benefits Wolverine will derive therefrom.
This news release shall not constitute an offer to sell or
the solicitation of an offer to buy the Common Shares in any
jurisdiction. The Common Shares have not been and will not be
registered under the United States Securities Act of 1933, as
amended (the "U.S. Securities Act") or any state securities laws
and may not be offered or sold in the
United States except in certain transactions exempt from the
registration requirements of the U.S. Securities Act and applicable
state securities laws.
Non-GAAP Measures
The Company uses accounting principles that are generally
accepted in Canada ("GAAP"), which
includes International Financial Reporting Standards ("IFRS").
Certain financial measures in this document do not have any
standardized meaning as prescribed by IFRS, including the non-GAAP
measure "proforma trailing 12-month EBITDA". This non-GAAP measure
used by the Company, may not be comparable to similar measures
presented by other reporting issuers, and is included because
management uses the information to analyze the Company's operating
performance. Therefore, this non-GAAP financial measure should not
be considered in isolation or as a substitute for measures of
performance prepared in accordance with GAAP. Proforma
trailing 12-month EBITDA is defined by the Company as net income
(loss) before finance costs, equipment rent, taxes, depreciation,
(gain) loss on bargain purchase, and amortization.
Neither the TSXV nor its Regulation Services Provider (as
that term is defined in the policies of the TSXV) has in any way
approved or disapproved the contents of this news release. The
TSXV does not accept responsibility for the adequacy or accuracy of
this release.
SOURCE Wolverine Energy and Infrastructure Inc.