14:10:07 EDT Sat 08 Aug 2020
Enter Symbol
or Name

Ag Growth International Inc
Symbol AFN
Shares Issued 14,416,271
Close 2016-03-11 C$ 30.69
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ORIGINAL: AGI to Acquire NuVision Industries Inc.

2016-03-14 06:10 ET - News Release

WINNIPEG, MANITOBA -- (Marketwired) -- 03/14/16

Ag Growth International Inc. (TSX:AFN) ("AGI" or the "Company") is very pleased to announce that it has entered into a binding agreement to acquire NuVision Industries Inc. ("NuVision"), a premier designer and builder of complete turnkey fertilizer blending plants and material handling facilities. The acquisition of western Canadian based NuVision represents a significant additional step in AGI's strategic entry into the fertilizer sector.

NuVision designs, manufactures, installs, and maintains fertilizer blending and handling facilities throughout Western Canada. It offers complete parts and services to the fertilizer industry and has the capacity to deliver high quality, design build fabrication services to facilitate project completion, commissioning, and ongoing service. NuVision sales and adjusted EBITDA, normalized primarily for related party items, over the previous four years has averaged approximately $18 million and $3.4 million, respectively. For the year ended December 31, 2015, NuVision sales and normalized EBITDA were approximately $32 million and $6.6 million, respectively.

The purchase price is based on five times NuVision's average EBITDA for the financial years 2015, 2016, 2017 and 2018, with a maximum purchase price of $26 million. The maximum purchase price represents a multiple of 4.0x 2015 normalized EBITDA. Terms of the transaction include payment of $12 million upon closing with additional amounts payable annually based on achieved EBITDA in 2016, 2017 and 2018. All payments under the agreement are payable 50% in cash and 50% in AGI equipment and the cash amount payable upon closing will be funded from AGI's cash balance.

"The acquisition of NuVision is another step in our developing platform for fertilizer storage and handling equipment in Western Canada and beyond", said Tim Close, President and CEO of AGI. "NuVision is a leading provider of commercial fertilizer distribution systems and allows AGI to now offer market leading, turnkey fertilizer systems for our customers. Our developing fertilizer platform is unique to AGI and positions us to offer the products and services our customers are asking for in the fertilizer sector. The growth of our fertilizer business continues our strategy of diversification and risk mitigation by adding complementary seasonality and demand drivers within our core markets and with our core customers."

"We are very pleased to welcome the entire NuVision team to AGI and we want to congratulate Lionel Kambeitz and Joe Wollner-Kallis for the company and team they have built. Joe will continue to lead NuVision and Lionel will continue as an advisor for Joe and for AGI in the fertilizer space."

Completion of the transaction requires regulatory approval and the approval of the shareholders of HTC Purenergy Inc., a publicly traded entity on the TSX Venture Exchange and the majority shareholder of the parent company to NuVision. The transaction is expected to close on April 1, 2016.

Company Profile

Ag Growth International Inc. is a leading manufacturer of portable and stationary grain handling, storage and conditioning equipment, including augers, belt conveyors, grain storage bins, grain handling accessories, grain aeration equipment and grain drying systems. AGI has manufacturing facilities in Canada, the United States, Brazil and Europe and distributes its products globally.


References to "normalized EBITDA" are to the unaudited earnings before income taxes, finance costs, depreciation and amortization of NuVision and include normalization adjustments for management fees and other payments related to NuVision's ownership structure. A non-IFRS financial measure is a measure of a company's historical financial performance, financial position or cash flow that excludes (includes) amounts, and is subject to adjustments that have the effect of excluding (including) amounts, that are included (excluded) in the most directly comparable measures calculated and presented in accordance with IFRS. Non-IFRS financial measures are not standardized; therefore, it may not be possible to compare these financial measures with other companies' non-IFRS financial measures having the same or similar businesses. We use these non-IFRS financial measures in addition to, and in conjunction with, results presented in accordance with IFRS. These non-IFRS financial measures reflect an additional way of viewing aspects of a company's operations that may provide a more complete understanding of factors and trends affecting the company's business. Management cautions investors that normalized EBITDA should not replace profit or loss as indicators of performance, or cash flows from operating, investing, and financing activities as a measure of the Company's liquidity and cash flows.


This press release contains forward-looking statements that reflect our expectations regarding the future growth, results of operations, performance, business prospects, and opportunities of the Company. Forward-looking statements may contain such words as "anticipate", "believe", "continue", "could", "expect", "intend", "plan", "will" or similar expressions suggesting future conditions or events. In particular, the forward looking statements in this press release include statements relating to our business and strategy, including our expectations with respect to the completion of the NuVision acquisition and the timing thereof, our ability to achieve the expected benefits of the NuVision acquisition, the anticipated impact of the NuVision acquisition on our business and the timing thereof and our outlook for the financial and operating performance of AGI and NuVision. Such forward-looking statements reflect our current beliefs and are based on information currently available to us, including certain key expectations and assumptions concerning anticipated grain production in our market areas, financial performance, business prospects, strategies, product pricing, regulatory developments, tax laws, the sufficiency of budgeted capital expenditures in carrying out planned activities, currency exchange rates and the cost of materials, labour, services, AGI's ability to achieve the expected benefits of the acquisition of NuVision, and the anticipated impact of the acquisition of NuVision on AGI's business. Forward-looking statements involve significant risks and uncertainties. A number of factors could cause actual results to differ materially from results discussed in the forward-looking statements, including changes in international, national and local business conditions, weather patterns, crop planting, crop yields, crop conditions, the timing of harvest and conditions during harvest, seasonality, industry cyclicality, volatility of production costs, agricultural commodity prices, the cost and availability of capital, currency exchange rates, competition, the failure to complete the NuVision acquisition on the terms or on the timing announced or at all and the failure realize some or all of the anticipated benefits of the acquisition of NuVision. These risks and uncertainties are described under "Risks and Uncertainties" in our most recently filed MD&A and Annual Information Form. These factors should be considered carefully, and readers should not place undue reliance on the Company's forward-looking statements. There can be no assurance that any of the anticipated benefits of the NuVision acquisition will be realized. We cannot assure readers that actual results will be consistent with these forward-looking statements and we undertake no obligation to update such statements except as expressly required by law.

Ag Growth International Inc.
Steve Sommerfeld
Investor Relations

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