CORAL GABLES, Fla.,
Oct. 20, 2014 /PRNewswire/ -- MasTec,
Inc. (NYSE: MTZ) today announced that it has acquired WesTower
Communications, Inc. ("WesTower"), a U.S. subsidiary of
Exchange Income Corporation (TSX:EIF). WesTower is a
telecommunications services firm, focusing on construction and
maintenance of communications infrastructure related to wireless
networks throughout the United States. WesTower's operations
have experienced significant revenue expansion, growing from
approximately $100 million in annual
revenues in 2010, to approximately $450
million in projected revenues in 2014. WesTower
currently provides services to a number of major wireless carriers
through 16 regional operating offices located throughout the
Eastern, Central and Western United
States, and currently has approximately 1,600 employees.
In the transaction, MasTec acquired all of the issued and
outstanding equity interests of WesTower for a one-time payment of
approximately $199 million in cash,
subject to customary purchase price adjustments. At closing,
WesTower had approximately $159
million in tangible net worth, comprised mostly of working
capital of $151 million, including
approximately $18 million in
cash.
Jose Mas, MasTec's Chief
Executive Officer, commented, "We are very excited about the
geographic expansion, increased market penetration and skilled
employee base that WesTower adds to our existing wireless
operations. WesTower's current operating margin and working capital
levels are indicative of industry-wide challenges managing the
complexities of rapid growth in wireless construction
services. These are challenges which MasTec faced and
overcame in our existing wireless operations through the
development of our processes and systems, which we believe to be a
competitive advantage. We are in a unique position to improve
WesTower's post-acquisition operating results and working capital
efficiency, and expect to expand margins, reduce working capital
requirements and grow the combined business with multiple
customers."
George Pita, MasTec's Chief
Financial Officer, commented, "We believe that once WesTower's
operations are integrated into MasTec billing systems and
processes, we will be able to substantially reduce overall working
capital levels in these operations by as much as 20%. We anticipate
that this transaction, exclusive of merger integration costs, will
be accretive to 2015 diluted earnings per share in the range of
$0.05- $0.10. For our upcoming fourth
quarter, we anticipate that this transaction, exclusive of merger
integration costs, and due to WesTower's seasonally lower fourth
quarter revenue expectations, will be approximately $0.01-$0.03 dilutive to diluted earnings per
share".
Management will hold a conference call to discuss this
transaction on Tuesday, October 21,
2014 at 9:00 a.m. Eastern
time. The call-in number for the conference call is
(913) 981-5509 and the replay number is (719) 457-0820, with a pass
code of 5186679. The replay will be available for 30
days. Additionally, the call will be broadcast live over the
Internet and can be accessed and replayed through the Investors
section of the Company's website at www.mastec.com.
MasTec, Inc. is a leading infrastructure construction company
operating mainly throughout North
America across a range of industries. The Company's primary
activities include the engineering, building, installation,
maintenance and upgrade of energy, utility and communications
infrastructure, such as: electrical utility transmission and
distribution; natural gas and petroleum pipeline infrastructure;
wireless, wireline and satellite communications; power generation,
including renewable energy infrastructure; and industrial
infrastructure. MasTec's customers are primarily in these
industries. The Company's corporate website is located at
www.mastec.com. Jose Mas, CEO
of MasTec, has led the Company since April of 2007.
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act. These
statements are based on management's current expectations and are
subject to a number of risks, uncertainties, and assumptions,
including the effect of economic downturns on demand for our
services, reduced capital expenditures by our customers, reduced
financing availability, customer consolidation and technological
and regulatory changes in the industries we serve; market
conditions, technological developments and regulatory changes that
affect us or our customers' industries; trends in electricity, oil,
natural gas and other energy source prices; our ability to
accurately estimate the costs associated with our fixed price and
other contracts, including any material changes in estimates for
completion of projects, and performance on such projects; customer
disputes related to our performance of services; disputes with, or
failures of, our subcontractors to deliver agreed-upon supplies or
services in a timely fashion; any material changes in estimates for
legal costs or case settlements or adverse determinations on any
claim, lawsuit or proceeding; our ability to replace non-recurring
projects with new projects; the timing and extent of fluctuations
in geographic, weather, equipment and operational factors affecting
the industries in which we operate; our ability to attract and
retain qualified personnel, key management and skilled employees,
including from acquired businesses, and our ability to enforce any
noncompetition agreements, integrate acquired businesses within
expected timeframes and achieve the revenue, cost savings and
earnings levels from such acquisitions at or above the levels
projected; any exposure related to divested businesses; any
exposure resulting from system or information technology
interruptions or data security breaches; the impact of U.S.
federal, local or state tax legislation and other regulations
affecting renewable energy, electricity prices, electrical
transmission, oil and gas production, broadband and related
projects and expenditures; the effect of state and federal
regulatory initiatives, including costs of compliance with existing
and future environmental requirements; increases in fuel,
maintenance, materials, labor and other costs; fluctuations in
foreign currencies; risks associated with operating in
international markets, which could restrict our ability to expand
globally and harm our business and prospects or any failure to
comply with laws applicable to our foreign activities; the highly
competitive nature of our industry; our dependence on a limited
number of customers; the ability of our customers, including our
largest customers, to terminate or reduce the amount of work, or in
some cases, the prices paid for services on short or no notice
under our contracts; the impact of any unionized workforce on our
operations, including labor availability and relations; liabilities
associated with multi-employer pension plans, including
underfunding and withdrawal liabilities, for our operations that
employ unionized workers; the adequacy of our insurance, legal and
other reserves and allowances for doubtful accounts; the
collectability of amounts owed us by our customers; restrictions
imposed by our credit facility, senior notes, convertible notes and
any future loans or securities; our ability to obtain performance
and surety bonds; the outcome of our plans for future operations,
growth and services, including business development efforts and
cost reduction measures, backlog, acquisitions and dispositions;
any dilution or stock price volatility that shareholders may
experience in connection with shares we may issue as consideration
for earn-out obligations or as purchase consideration in connection
with past or future acquisitions, or as a result of conversions of
convertible notes or other stock issuances; liabilities associated
with our participation in joint ventures and other losses
associated with non-consolidated investees; our ability to settle
conversions of our convertible notes in cash due to contractual
restrictions, including those contained in our credit facility, and
the availability of cash; as well as other risks detailed in our
filings with the Securities and Exchange Commission. Actual results
may differ significantly from results expressed or implied in these
statements. We do not undertake any obligation to update
forward-looking statements.
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SOURCE MasTec, Inc.