H2O Innovation Enters into an Agreement to Acquire the business of Leader Evaporator Co., Inc. Strengthening its Position in the Maple Industry
April 12 2022 - 3:00PM
(TSX: HEO) – H2O Innovation Inc. (“H2O Innovation” or the
“Corporation”) is proud to announce that a binding letter of intent
has been entered into with respect to the acquisition of the
business carried on by Leader Evaporator Co., Inc. (“Leader”).
Leader has been selling maple farming equipment and products for
more than 130 years to maple syrup producers located mainly in the
United States. The brand is positioned as the perfect combination
between tradition and quality.
H2O Innovation, through its maple business line,
is already an important player in the maple industry for the last
30 years, by manufacturing and selling equipment for the
manufacture of maple syrup to producers located in both Canada and
the USA. The Corporation distinguishes itself by its capacity to
develop and manufacture innovative solutions and products built
around its membrane filtration expertise, in its facility of 81,390
sq. ft. located in Ham-Nord, Quebec. The maple business line of H2O
Innovation was also among the first in the industry to introduce
the H2O-Smartrek technology, providing accurate intelligence to
optimize the collection of maple sap, the remote monitoring and the
control of a complete maple production.
This transaction should allow H2O Innovation to
increase its market share in the maple industry, primarily in the
United States of America, to solidify its position as manufacturer
of maple equipment and products and to expand its manufacturing
capabilities with an additional facility of 103,780 sq. ft. located
in the Town of Swanton, VT. In addition, H2O Innovation will add 53
distributors and dealers to its current distribution network of
nearly 50 distributors. Through this transaction, H2O Innovation
will inherit the expertise, talent and manufacturing know-how of
more than 50 employees working at the Swanton facility.
The transaction is expected to close before July
1, 2022 and is subject to customary closing conditions for this
kind of transaction. The transaction will be financed using the
Corporation’s available cash and/or existing credit facilities.
“This transaction is a perfect fit for H2O
Innovation’s maple business line as we already foresee multiple
synergies. We envision partnering with Leader’s customers to
continue building a business of significant value, one that honors
the legacy of Leader, and thus, becoming one of the most important
players in the maple industry. The transaction will also contribute
to solidifying customer retention and to creating additional
recurring revenues. The acquisition is expected to increase
revenues coming from maple equipment and products by 60% to 70% and
to expand our manufacturing capabilities to answer the growing
demand of the maple industry,” said Frédéric Dugré,
President and Chief Executive Officer of
H2O Innovation.
“We are very excited about this transaction
because it capitalizes on Leader’s historical legacy for quality
and innovation, while positioning it to be a truly international
brand, giving the resources and capabilities to, within a few
years, become the maple industry’s market leader. The synergies
between the Leader and H2O Innovation product lines and the harmony
of our company cultures makes this a perfect fit. And with the
maple farming sector poised for a major growth cycle, this
transaction sets Leader and H2O Innovation up for a very strong
decade of growth,” stated Jeff Smith, President of
Leader.
Prospective DisclosuresCertain
statements set forth in this press release regarding the operations
and the activities of H2O Innovation as well as other
communications by the Corporation to the public that describe more
generally management objectives, projections, estimates,
expectations or forecasts may constitute forward-looking statements
within the meaning of securities legislation. Such forward-looking
statements include, but are not limited to, the completion of the
transaction described herein, the effects of the integration of
acquired business and the ability to achieve projected synergies.
Forward-looking statements concern analysis and other information
based on forecast future results, performance and achievements and
the estimate of amounts that cannot yet be determined. Those
forward-looking statements, based on the current expectations of
management, involve a number of risks and uncertainties, known and
unknown, which may result in actual and future results,
performance, and achievements of the Corporation to be materially
different than the said forward-looking statements. Information
about the risk factors to which the Corporation is exposed is
provided in the Annual Information Form dated September 27, 2021
available on SEDAR (www.sedar.com).
About
H2O Innovation Innovation
is in our name, and it is what drives the organization. H2O
Innovation is a complete water solutions company focused on
providing best-in-class technologies and services to its customers.
The Corporation’s activities rely on three pillars: (i) Water
Technologies & Services (WTS) applies membrane technologies and
engineering expertise to deliver equipment and services to
municipal and industrial water, wastewater, and water reuse
customers, (ii) Specialty Products (SP) is a set of businesses
that manufacture and supply a complete line of specialty chemicals,
consumables and engineered products for the global water treatment
industry, and (iii) Operation & Maintenance (O&M)
provides contract operations and associated services for water and
wastewater treatment systems. Through innovation, we strive to
simplify water. For more information, visit
www.h2oinnovation.com.
Source: H2O Innovation Inc.
www.h2oinnovation.com
Contact: Marc Blanchet+1 418-688-0170
marc.blanchet@h2oinnovation.com
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