The Selling Company: Parkland Pipeline Contractors, Ltd. is a leading small- to mid-bore pipeline construction company operating throughout Western Canada. The company serves the oil & gas majors and the larger independent exploration and production companies that produce and ship oil sands bitumen-derived petroleum, conventional petroleum, and natural gas in the Western Canadian Sedimentary Basin.
Why the company was sold: Nearing retirement age, the shareholders sought a reduction in their personal risk profiles and liquidity, having prepared the company for sale by putting a successor management team in place.
Capital Alliance’s Performance: Capital Alliance identified a dozen qualified and highly interested buyers for the company. Ultimately, three buyers submitted offers, all of which were in excess of 40% higher than the seller’s price expectations. The sellers selected an acquirer who offered the largest amount of cash at closing, an attractively structured earn out, and a guaranteed CAPEX investment in the company to support meeting the earn out targets.
Terms of the Transaction: The transaction valuation exceeded the seller’s expectations by a substantial amount. Capital Alliance negotiated favorable terms for working capital, indemnification of the buyers by the sellers, and a deal that included no escrow.
The Acquiring Company: Tetra Tech was a $1.87 billion market cap public company at the time the deal was closed. Tetra Tech is focused on growth in the energy infrastructure services market space.
