NRC Group ASA ("NRC Group" or the "Company") has on 30 August 2018 entered into
a definitive agreement for the acquisition of Gunnar Knutsen AS ("GK") for an
enterprise value of NOK 199 million on a cash and debt free basis.
Construction and infrastructure development is associated with major climate and
environmental responsibility. There is a clear trend of increased regulations
and expectations from the authorities related to sustainability and
environmental impact. The same trend is reflected among customers and other
stakeholders, which has led to a higher weighting of environmental and safety
considerations in tendering processes. The acquisition of GK further strengthens
NRC Group's Norwegian operations and broadens the company's overall capabilities
as a turnkey contractor.
"Infrastructure development projects are increasingly subject to environmental
regulations, requirements and expectations. We are committed to operate in the
most sustainable manner with the competence and capacity needed to provide a
full range of services, from planning and project management to the actual
physical work of decommissioning, remediation and waste logistics," says Øivind
Horpestad, CEO of NRC Group ASA.
"Environmental services are a growth opportunity for us. The acquisitions of GK
and previously announced Norsk Saneringsservice AS and Miljøvakta AS, strengthen
our competitive position, both on our own projects and as a third-party
supplier," adds Horpestad.
GK is one of Norway's leading companies within transportation of loose materials
for the building and construction industry in Norway. GK currently employs
approximately 55 people. The company owns a fleet of 44 modern trucks and
vehicles, operated from a newly built headquarter and operation central, located
in Bærum, Akershus. The company had a revenue of NOK 234 million in 2017 with an
EBITDA of NOK 33 million. The company has a large and loyal base of customers of
public and private construction companies within the larger capital area.
NRC Group will acquire 100% of the shares in GK. The enterprise value is NOK 199
million on a cash and debt free basis and assuming a normalized level of working
capital. The seller has guaranteed an aggregate EBIT for the second half of 2018
and FY19 of at least NOK 45 million.
Assuming no adjustments in the enterprise value, 60% of the purchase price will
be settled by payment of NOK 119.4 million in cash and the remaining 40% of the
purchase price of NOK 79.6 million will be settled by way of 1,154,962 shares in
the Company at a price of NOK 68.92 per share, of which 405,000 shares will be
existing shares held in treasury and 749,962 shares will be newly issued shares
(the "Consideration Shares"). The Consideration Shares are subject to lock-up
periods, whereby 1/2 of the Consideration shares are subject to a lock-up
undertaking of 24 months and the remaining 1/2 for 36 months after the closing
date. The seller will pledge a number of Consideration Shares that represents in
aggregate a value of NOK 30 million as security for claims the Company may have
against the seller. The transaction is expected to be completed during September
2018.
The following table provides key financial information (based on local statutory
accounts) for GK:
(NOK million) FY 2017 FY 2016 (Pro forma*)
Revenue 233.8 274.0
EBITDA 33.2 44.1
EBIT 23.8 35.6
EBIT margin (%) 10.2 13.0
Cash and cash equivalents 28.1 62.3
Total assets 133.4 144.9
* Include Bardalen, Steen & Lund AS that was acquired in 2016 and merged with GK
as of 1 January 2017.
GK will be organized as a separate subsidiary under NRC Norge AS, a wholly owned
subsidiary of NRC Group ASA.
There are no special agreements or arrangements that have been or will be
entered into with the directors or executive management of GK or the Company in
connection with the transaction.
***
For further information, please contact CEO Øivind Horpestad, telephone: +47 91
00 06 26
About NRC Group ASA:
NRC Group is a leading contractor within railway infrastructure in Norway and
Sweden. The company is a supplier of all track-related infrastructure services,
including groundworks, specialized track work, safety, electro, telecom- and
signaling systems. The company works within rail, metro, tram segments and close
related infrastructure. NRC Group has experienced significant growth since its
inception in 2011 and has a vision of becoming the leading Nordic entrepreneur
within railway infrastructure.
For more information: www.nrcgroup.no/.
About GK
GK is one of Norway's leading companies within transportation of loose materials
for the building and construction industry in Norway. The company is
headquartered in Skui and had a revenue of approximately NOK 234 million in
2017. For more information: www.gunnarknutsen.no
This information is subject to the disclosure requirements pursuant to section 5
-12 of the Norwegian Securities Trading Act.