Essex Rental Corp. Successfully Completes Acquisition of Coast Crane Company
29 November 2010 - 2:30PM
Business Wire
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 An archived version of this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.”
About Essex Rental Corp.
Essex, through its subsidiaries, Essex Crane Rental Corp. and
Coast Crane Company, is one of North America's largest providers of
mobile cranes (including lattice-boom crawler cranes, truck cranes
and rough terrain cranes), self-erecting cranes, stationary tower
cranes, elevators and hoists, and other lifting equipment used in a
wide array of construction projects. In addition, the Company
provides product support including installation, maintenance,
repair, and parts and services for equipment provided and other
equipment used by its construction industry customers. With a fleet
of over 1,000 cranes and other construction equipment and
unparalleled customer service and support, Essex supplies a wide
variety of innovative lifting solutions for construction projects
related to power generation, petro-chemical, refineries, water
treatment and purification, bridges, highways, hospitals,
shipbuilding, offshore oil fabrication and industrial plants, and
commercial and residential construction.
About Coast Crane Company
Founded in 1970, Coast Crane Company has grown to become the
market leader for innovative lifting solutions throughout Western
North America, Alaska, Hawaii, Guam and the South Pacific. The
Company provides both used and new equipment including rough
terrain cranes, boom trucks, tower cranes, and other lifting
equipment. Products are rented and sold through a regional network
including 13 branch locations and covering over 3,000 customer
accounts. Coast Crane enjoys strong working partnerships with the
leading crane and lifting manufacturers in the U.S. and has a
dedicated and unparalleled customer service and support team.
Some of the statements in this press release and other written
and oral statements made from time to time by Essex, Coast and
their respective representatives are “forward-looking statements”
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. These statements include statements regarding the intent
and belief or current expectations of Essex, Coast and their
respective management teams and may be identified by the use of
words like "anticipate", "believe", "estimate", "expect", "intend",
"may", "plan", "will", "should", "seek", the negative of these
terms or other comparable terminology. Investors are cautioned that
any such forward-looking statements are not guarantees of future
performance and involve risks and uncertainties, and that actual
results may differ materially from those projected in the
forward-looking statements. Important factors that could cause
actual results to differ materially from Essex’s or Coast’s
expectations include, without limitation, the continued ability of
Essex and Coast to successfully execute their respective business
plans, the possibility of a change in demand for the products and
services that Essex provides (through its subsidiary, Essex Crane)
and that Coast provides, the failure to obtain Bankruptcy Court
approval of the Coast acquisition, intense competition which may
require us to lower prices or offer more favorable terms of sale,
our reliance on third party suppliers, our indebtedness which could
limit our operational and financial flexibility, global economic
factors including interest rates, general economic conditions,
geopolitical events and regulatory changes, our dependence on our
management team and key personnel, as well as other relevant risks
detailed in our Annual Report on Form 10-K and other periodic
reports filed with the Securities and Exchange Commission and
available on our website, www.essexcrane.com. The factors listed
here are not exhaustive. Many of these uncertainties and risks are
difficult to predict and beyond management’s control.
Forward-looking statements are not guarantees of future
performance, results or events. Essex assumes no obligation to
update or supplement forward-looking information in this press
release whether to reflect changed assumptions, the occurrence of
unanticipated events or changes in future operating results or
financial conditions, or otherwise.
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