Enterprise Group, Inc. Announces Letter of Intent to Purchase Specialized Underground Infrastructure Construction Company

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Enterprise Group, Inc. Announces Letter of Intent to Purchase Specialized Underground Infrastructure Construction Company
Marketwire.com - Feb 28, 2013

ST. ALBERT, ALBERTA--(Marketwire - Feb. 28, 2013) - Enterprise Group, Inc. ("Enterprise" or "Company") (TSX:E) is pleased to announce the signing of a letter of intent to purchase a highly successful specialized underground infrastructure construction company (the "private company") with operations based in Alberta.

The private company is a leader in specialized underground infrastructure construction in Western Canada. Enterprise's strategy is to continue to grow the private company in its core competencies while expanding services to a larger customer base while leveraging the synergies available through Enterprise's existing operations. For the year ended 2012, preliminary unaudited sales revenue for the private company was approximately $14.9 million and EBITDA was approximately $5.8 million.

Enterprise will purchase the shares of the private company for $12 million and will be funded by cash, asset debt financing, and $1,000,000 in vender take-back financing to be paid over two years. Completion of this acquisition will be subject to negotiation of a definitive share purchase agreement, satisfactory due diligence by Enterprise, completion of the asset-based debt financing and customary closing conditions. Enterprise expects to close the transaction on or before May 1, 2013.

Management is currently discussing available funding options with its investment banking advisors.

Enterprise Group, Inc. is a construction services company operating in the energy, utility and transportation infrastructure industry. The Company's focus is primarily underground construction and maintenance and above ground plants and facilities and specialized equipment rental. The Company's strategy is to acquire complementary service companies in Western Canada, consolidating capital, management and human resources to support continued growth.

Forward Looking Information

Certain statements contained in this news release constitute forward-looking information. These statements relate to future events or the Company's future performance. The use of any of the words "could", "expect", "believe", "will", "projected", "estimated" and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the Company's current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. In particular, statements with respect to the completion of the proposed acquisition, the terms and conditions of the transaction, the completion of an asset-based debt financing and financial information relating to the private company include forward-looking information. The proposed acquisition may not be completed on the terms and conditions contemplated herein or at all. The Company's Annual Information Form and other documents filed with securities regulatory authorities (accessible through the SEDAR website www.sedar.com) describe the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference. The Company disclaims any intention or obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as may be expressly required by applicable securities laws.

Non-GAAP Measures

This news release contains references to EBITDA. The Company uses accounting principles that are generally accepted in Canada (the issuer's "GAAP"), which includes without limitation, International Financial Reporting Standards ("IFRS"). EBITDA is not a measure that has any standardized meaning prescribed by IFRS and is therefore referred to as a non-GAAP measure. This non-GAAP measure used by the Company may not be comparable to a similar measure used by other companies. Management believes that in addition to net income, EBITDA is a useful supplemental measure as it provides an indication of the results generated by the Company's principal business activities prior to consideration of how those activities are financed or how the results are taxed. EBITDA is calculated as net income excluding depreciation, amortization, interest and taxes.

Contact Information

First Canadian Capital Corp.
Daniel Boase
416-742-5600
DBoase@firstcanadiancapital.com
145 Front Street East
Toronto, ON M5A 1E3

Enterprise Group, Inc.
Leonard D. Jaroszuk
President & CEO
780-418-4400

Enterprise Group, Inc.
Desmond O'Kell
Vice President
780-418-4400
contact@EnterpriseGRP.ca
www.EnterpriseGRP.ca