Chemtrade Logistics Income Fund to Acquire Polytec, a Provider of Turnkey Water Treatment Solutions
Polytec was founded over 30 years ago and provides turnkey water treatment solutions to a diverse customer base, primarily in the food-processing industry but also in the municipal market.
The purchase of Polytec will add a unique solutions platform to Chemtrade's line of water treatment chemicals products. Chemtrade's North American-wide footprint and internal business systems will be used to leverage Polytec's business, with opportunities for cross-selling in the U.S. and Canada as well as more efficient management of overall business systems.
'This transaction will enable Chemtrade to expand its footprint in water solutions for the food-processing industry and municipal markets while also adding to our range of products,' said Scott Rook, President and CEO of Chemtrade. 'Polytec's founder Jack Harmon has built a company with the reputation of providing the best quality service and products. It is an excellent addition to Chemtrade's capabilities, broad spectrum of customers, logistics network, and technical expertise. Furthermore, the acquisition of Polytec is well-aligned with our strategy of growing the water business and represents an important step towards delivering on the growth pillars of Chemtrade's Vision 2030.'
Commenting on the acquisition, Chemtrade's CFO, Rohit Bhardwaj, said 'Our successful leverage reduction strategy has provided Chemtrade with the financial flexibility to pursue compelling growth opportunities such as the acquisition of Polytec while continuing to maintain a conservative balance sheet and leverage within our target range without diluting our unitholders. Our capital deployment decisions remain grounded in financial discipline and are aligned with our goal of driving sustainable earnings growth and attractive total unitholder returns.'
Polytec's founder Jack Harmon has committed to staying actively involved in the business in the months following the close of the sale to ensure a smooth transition for employees and customers.
'Polytec was founded over 30 years ago with the commitment to provide customers with high quality service, products, and technology. Over the years, Polytec invested in manufacturing facilities across four Southeastern states with the ability to support customer programs throughout the USA and internationally. The combination of Polytec and Chemtrade will reinforce our manufacturing and service capabilities as we aim to use our knowledge, service, and products to keep our customers compliant with water quality regulations,' said Jack Harmon, founder of Polytec. 'Chemtrade shares a similar vision, and I am confident that the combination of Polytec's unique water treatment solutions and Chemtrade's footprint will further accelerate our growth and the quality service we provide to our customers.'
Advisors
BMO Capital Markets served as financial advisor and Dorsey & Whitney LLP as legal advisor to Chemtrade.
About Chemtrade
Chemtrade is a Canadian company, headquartered in Toronto, Ontario, which operates a diversified business providing industrial chemicals and services to customers across North America and around the world. Chemtrade is one of North America's largest suppliers of sulphuric acid, spent acid processing services, inorganic coagulants for water treatment, sodium chlorate, sodium nitrite and sodium hydrosulphite. Chemtrade is also a leading producer of high purity sulphuric acid for the semiconductor industry in North America. Chemtrade is a leading regional supplier of sulphur, chlor-alkali products, and zinc oxide. Additionally, Chemtrade provides industrial services such as processing by-products and waste streams.
Caution Regarding Forward-Looking Statements
Certain statements contained in this news release constitute forward-looking statements within the meaning of certain securities laws, including the Securities Act (Ontario). Forward-looking statements can be generally identified by the use of words such as 'anticipate', 'continue', 'estimate', 'expect', 'expected', 'intend', 'may', 'will', 'project', 'plan', 'should', 'believe' and similar expressions. Specifically, forward-looking statements in this news release include statements with respect to certain future expectations about: Chemtrade's ability to obtain regulatory approvals, to close the acquisition transaction and the timing thereof; the source of funding for the transaction; Chemtrade's ability to maintain ample liquidity and leverage following the transaction; Chemtrade's ability to leverage Polytec's business across North America and via its internal business systems; its ability to cross sell in the US and Canada and to more efficiently manage overall business systems; Chemtrade's ability to expand its water solutions footprint for the food-processing industry and municipal markets while adding to its range of products; and the length of time Mr. Harmon will remain as a consultant.
Forward-looking statements in this news release describe the expectations of the Fund and its subsidiaries as of the date hereof. These statements are based on assumptions and involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements for a variety of reasons, including without limitation the risks and uncertainties detailed under the 'RISK FACTORS' section of the Fund's latest Annual Information Form and the 'RISKS AND UNCERTAINTIES' section of the Fund's most recent Management's Discussion & Analysis.
Although the Fund believes the expectations reflected in these forward-looking statements and the assumptions upon which they are based are reasonable, no assurance can be given that actual results will be consistent with such forward-looking statements, and they should not be unduly relied upon. Except as required by law, the Fund does not undertake to update or revise any forward-looking statements, whether as a result of new information, future events or for any other reason. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement.
Further information can be found in the disclosure documents filed by Chemtrade Logistics Income Fund with the securities regulatory authorities, available at www.sedarplus.com.
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