SECURE shareholders will own nearly 52% in the combined company, while Tervita shareholders will hold 48% stake
Canada-based energy services firms SECURE Energy Services and Tervita have agreed to merge to form a combined midstream infrastructure and environmental solutions business, in an all-share transaction.
The combined company will have an implied total enterprise value of around $2.3bn. It would operate under brand name SECURE, and continue its operations from its headquarters in Calgary, Alberta.
Upon closing of the transaction, SECURE shareholders will own nearly 52% and Tervita shareholders 48% in the combined company.
SECURE chairman, president, and chief executive officer Rene Amirault said: “We are pleased to announce the combination of these two great companies, resulting in the creation of a larger scale midstream infrastructure and environmental solutions business.
“Together, our highly talented teams will be better positioned to serve our customers, optimize existing infrastructure assets and operations and to drive greater discretionary free cash flow to the bottom line.
“We look forward to working with the Tervita Board of Directors and team, and we are excited about the value creation opportunities of this Transaction for all stakeholders.”
The transaction is expected to result highly complementary midstream infrastructure asset bases and environmental service lines, delivering enhanced scale, utilization, efficiencies, and expanded services for the combined company’s customers.
The combined company is expected to provide enhanced free cash flow generation resulting from greater scale and significant annual integration cost savings of $75m.
SECURE provides solutions to upstream oil and natural gas companies operating in western Canada and certain regions in the US.
The company has a network of midstream processing and storage facilities, crude oil and water pipelines, and crude by rail terminals located throughout key resource plays in western Canada, North Dakota and Oklahoma.
Tervita is an environmentally-focused waste service provider in Canada. It provide an array of services and environmental management solutions for customers in the energy, industrial, and natural resource sectors, mainly in Western Canada.