Clearford Announces the Acquisition of an Ontario Private Water Utility, and Additional Debt Financing
Ottawa, Ontario – (June 4, 2018) – Clearford Water Systems Inc. (“Clearford” or the “Company”), (TSX-V: CLI), today announced the acquisition of a privately owned local water utility in Ontario’s Niagara Region that provides safe drinking water for approximately 300 residents on the shores of Lake Erie.
The utility was purchased in an all cash deal from a private owner. The utility’s assets include regulatory permits and permanent infrastructure for water intake from Lake Erie, a drinking water treatment plant, and a water distribution pipe network to deliver potable water to residences. The Company is also looking at options to expand the customer base which may include new developments and existing residences or commercial operations serviced by private wells.
The acquisition will be the foundation of Clearford Water Utility (Ontario) Inc., a new subsidiary set up to acquire water and wastewater assets in Ontario. This is the latest stage in the execution of the Company’s business model of becoming a full-service water utility and technology provider after the initial acquisition of Koester Canada and its Team Aquatic operations division in November 2017. “We expect to increase the recurring revenue and operational profit generated from this new utility in the coming years as we implement best management practices and evaluate strategic upgrades that will lower the overall operating costs for the utility,” said Kevin Loiselle, President and CEO of Clearford.
“We will continue to review acquisition targets in an effort to make additional similar strategic acquisitions as Clearford is now in an excellent position to deploy this new utility model for other communities in Ontario that can benefit from the unique combination of professional services, end-to-end engineered solutions and project-based financing that we have put together to support the Company’s growth plans over the past year,” he concluded.
In conjunction with this acquisition, Clearford announced that it has entered into two new loan agreements. The total value of the new loans is US$2.26 million. Both loans are 10-year term loans and bear a 9.75% interest rate with interest payable semi-annually. The Company also announced that it has received final approval for the C$1.65 million convertible debenture it previously announced.
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About Clearford Water Systems Inc.
Clearford Water Systems is a provider of unified water management solutions for the design, deployment, finance and operation of water infrastructure systems. The Company’s technology-based water solutions include Clearford One® wastewater infrastructure systems, Clearford M-brane™ packaged treatment solutions, and a full range of UV Pure® water disinfection products. Clearford is the winner of the Frost & Sullivan 2017 Enabling Technology Leadership Award for Global Decentralized Water & Wastewater Treatment. For more information, visit www.clearford.com.
Forward Looking Statements
This news release contains certain statements that constitute forward-looking statements as they relate to the Company and its management. Forward-looking statements are not historical facts but represent management’s current expectation of future events, and can be identified by words such as “believe”, “expects”, “will”, “intends”, “plans”, “projects”, “anticipates”, “estimates”, “continues” and similar expressions. Although management believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that they will prove to be correct.
By their nature, forward-looking statements include assumptions and are subject to inherent risks and uncertainties that could cause actual future results, conditions, actions or events to differ materially from those in the forward-looking statements. If and when forward-looking statements are set out in this news release, Clearford will also set out the material risk factors or assumptions used to develop the forward-looking statements. Except as expressly required by applicable securities law, the Company assumes no obligation to update or revise any forward looking statements. The future outcomes that relate to forward-looking statements may be influenced by many factors, including, but not limited to: industry cyclicality; the ability to secure third party agreements; successful integration of Clearford’s system with third party technology; competition; reduction in demand for products; collection from customers; relationships with suppliers; product liability; intellectual property; reliance on key personnel; environmental; interest rates; uninsured and underinsured losses; operating hazards; risks of future legal proceedings; income tax matters; credit facilities; availability and terms of financing; distribution of securities; restrictions on potential growth; effect of market interest rates on price of securities; and potential dilution.
For more information contact:
Kevin Loiselle, President & CEO
Clearford Water Systems Inc.
Phone: (613) 599-6474 ext. 303