Carillion Buys 60% Stake In Canada's Rokstad Power, To Buy Rest Later

LONDON (Alliance News) - Carillion PLC Monday said it has agreed to buy a 60% stake in the trade ...


Alliance News | 1 December, 2014 | 7:24AM

LONDON (Alliance News) - Carillion PLC Monday said it has agreed to buy a 60% stake in the trade and assets of British Columbia, Canada-based Rokstad Power Corp for up to GBP33 million, boosting its presence in the electric power transmission and distribution market.

Family-owned Rokstad employs over 600 staff in providing transmission and distribution power line services, including specialist live line operations, in "strategic locations" primarily across Canada, Carillion said.

It made revenue of GBP108.5 million and pretax profit of GBP13.1 million in the 12 months to June 30.

The total amount Carillion will pay for Rokstad is dependent on the financial performance of the acquired assets. It will pay in installments, including a GBP11 million payment in 2014 and GBP10 million in 2015. The remaining payments will be made over 2016 and 2017, will be based on Rokstad's performance, and will be capped at a combined GBP12 million.

The British company has also committed to acquire the remaining 40% in Rokstad after five years at a multiple of 4.5 times Rokstad's 2019 earnings before interest, tax, depreciation and amortisation, capped at a maximum additional consideration of GBP42 million.

Carillion said that it will consolidate all of Rokstad's net debt on to its balance sheet as soon as the initial deal is completed, some GBP21 million.

''Acquiring this interest in The Rokstad Group is an important strategic step in the development of our transmission and distribution business," Carillion Chief Executive Richard Howson said in a statement.

"Rokstad's knowledge, skills and culture complement our own. This acquisition will therefore create significant new opportunities for us to grow our transmission business and capitalise on the unprecedented pipeline of work in the power transmission and distribution markets through extending our offering to new and existing customers," he added.

By Steve McGrath; stevemcgrath@alliancenews.com; @stevemcgrath1

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