Orbit Garant Drilling Inc. (TSX: OGD) today announced the acquisition of Forage+. Under terms of the transaction, Orbit Garant has purchased all of the issued and outstanding shares of 9129-5632 Quebec Inc., doing business as Forage+, a specialized drilling company operating seven drilling rigs.
As part of the transaction, Orbit Garant is acquiring a 100,000-metre drilling services contract with Osisko Mining Corp. (TSX:OSK), a Forage+ customer.
The purchase price consists of $1.5 million in cash and 457,142 payable in common shares of Orbit Garant representing an aggregate amount of $1.6 million, issued at an allocated value of $3.50 per share and the payment amount of $624,456 to the Vendors in order to compensate for the difference between the 30-day average trading price of $2.134 per share and the allocated value of $3.50 per share.
The parties have agreed to a contractual escrow agreement with a release period of over 30 months. Larry Belanger, CEO of Forage+, has entered into a 12-month employment contract with Orbit Garant.
"We expect this transaction to be immediately accretive and to generate approximately $2.6 million in incremental EBITDA over the next 12 months," said Eric Alexandre, President and Chief Operating Officer. "This strategic acquisition will further leverage our established infrastructure, expand on our already strong market position of specialty drilling in the Abitibi region of Quebec, and bring the company an important new customer."
Osisko hold a 100 per cent interest in the Canadian Malartic gold deposit in the Abitibi region of Quebec, Canada. On September 8, 2008, Osisko filed an initial NI 43-101-compliant resource estimate for the main deposit, with a gold resource of 7.69 million ounces in the Measured & Indicated category and 720,000 ounces in the Inferred category.
Eric Alexandre added, "Completion of the drilling program at the Canadian Malartic gold deposit will require the use of additional specialized drills. Through our manufacturing subsidiary, Soudure Royale, Orbit Garant is very well positioned to meet this need." -- www.cnxmarketlink.com
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