WINNIPEG, MANITOBA, CANADA — Ag Growth International Inc. (AGI) announced on Nov. 11 that AGI, Vicwest Inc. and Kingspan Group plc have entered into an agreement in which Kingspan will acquire all of the issued and outstanding shares of Vicwest and AGI will acquire substantially all of the assets of Vicwest's Westeel Division.
Headquartered in Winnipeg, Manitoba, Canada, Westeel is a leading provider of grain storage solutions in Western Canada offering a wide range of on-farm and commercial products for the agricultural industry.
Westeel also has a growing international platform focused on complementary geographies and offering highly engineered crop storage and handling solutions. For the year ending Dec. 31, Westeel is expected to generate Adjusted EBITDA of approximately C$20 million. The estimated Adjusted EBITDA reflects earnings of the Westeel business (before any costs associated with Vicwest's corporate support functions that will not be transferred to AGI as part of the transaction) less incremental corporate support costs AGI estimates will be required post-closing.
The aggregate purchase price for the Transaction is C$221.5 million in cash, which reflects an enterprise value for Westeel of approximately C$210 million and C$11.5 million attributed to certain assets that will be acquired by AGI at closing, including net cash and working capital adjustments and the facility in Regina, Saskatchewan, Canada, that is currently for sale.
"AGI's vision is to become the global market leader in grain handling, storage and conditioning solutions. Today's acquisition will add an iconic Canadian brand of grain storage to AGI's already impressive stable of leading manufacturers of grain handling and conditioning equipment, including Westfield, Hi Roller, Tramco and Batco," said Gary Anderson, president and chief executive officer of AGI. "Westeel provides a complementary product offering to expand our growth platform within North America and around the world. Combined we create a Canadian-based agricultural champion, providing an expanded North American platform to leverage globally while in turn reducing our overall risk profile to emerging market development.”