GL&V expands in Europe
GL&V (Groupe Laperrière & Verreault) – Ticker Symbols: LV.A, LV.B / TSE
Trois-Rivières, September 27, 2000 — At today's Annual General Meeting of Shareholders in Montreal, GL&V announced the signing of an agreement with the COINPASA Group (Bilbao, Spain), to merge its European proprietary rights with those of ENERTEC, S.A. (formerly Beloit Ibèrica), a subsidiary of COINPASA. The closing of the transaction is scheduled for the coming weeks. This merger will be followed by the creation of the subsidiary GL&V Pulp and Paper Europe, which will be integrated into GL&V's Pulp and Paper Group to strengthen its position in Europe subsequent to the recent acquisitions of Celleco and Beloit. This joint venture will be equally owned by GL&V and the COINPASA Group and will contribute sales of approximately $50 million to GL&V's revenues as of the first year.
"We are pleased with this agreement which will expand and consolidate our sales, design and engineering organization and position our trademarks for the long term in Europe. Enertec has been an exclusive licensee of Beloit for the full range of pulp and paper manufacturing equipment since 1983. It is also the leading designer and manufacturer of pulp and paper production equipment in Spain and Portugal. It is a cutting-edge company with a young, dynamic team that has in-depth knowledge of our products and European markets. Besides exporting to several countries in Europe, Enertec sells some of its products in Latin America and Asia. We will integrate its mechanical engineering team and exchange our technologies and trademarks for European markets," indicated Laurent Verreault, President and Chief Executive Officer of GL&V.
"Our North American network is well established, running smoothly and profitably. Our new developments in Australia and Europe will have a major impact on our synergies and international positioning," added Mr. Verreault. On September 19, 2000, GL&V created GL&V Australia Pty. Ltd. after acquiring the assets of ADDAX Australia Pty. Ltd., formerly Beloit Australia Pty. Ltd., and combining its operations with those of GL&V/Dorr-Oliver Pty. Ltd.
GL&V will set up mixed markets in South America, Africa and the Asia Pacific region to optimize its sales force and increase the penetration of its international trademarks.
Optimizing its sales network is one of management's priorities to increase GL&V's efficiency following its various acquisitions worldwide. In markets outside North America and Europe, GL&V will promote its international trademarks through the same pipeline to eliminate duplicate networks and maximize sales efforts. "GL&V Australia marks a first step in this direction," explained Mr. Verreault.
Consistent with its integration strategy, GL&V has divested close to $10 million in non-strategic assets and operations and reduced its long-term debt by more than 20% over the past five months. Other asset disposals are planned from now to the end of the year.
William Saulnier, Vice-President, Finance and Administration, pointed out to shareholders that "since 1996, GL&V has more than tripled its revenues and net earnings." He added that "the solid performance it has sustained for several quarters is due not only to its acquisitions, but also to its strategy over the past five years, during which it has been an efficient integrator. It has made eight acquisitions in four years, which have rapidly contributed to sales and earnings even though some of the acquired entities were in a precarious financial position."
Over the past five months, GL&V has divested various non-strategic assets for proceeds of close to $10 million, which were used to reduce its long-term debt by an equivalent amount. Since the beginning of fiscal 2001, the long-term/equity ratio has improved from 1.5:1 to 1.0:1. These disposals include GL&V Pulp Group Inc.'s equipment in Nashua and a building in Australia. In the coming months, the Company will continue to reduce its long-term debt by making further asset disposals that could exceed $20 million by year-end, as well as by generating cash flows from operations.
Payment of a special dividend of $0.10 per share Toward a half-billion $ in revenues by 2001
GL&V is confident and optimistic about the future. Over the next two years, it will pursue the integration under way while continuing to develop its product mix by way of small acquisitions and strategic alliances. The Company expects to achieve revenues of $425 to $450 million by March 31, 2001. Outside the Shareholders' Meeting, GL&V's Board of Directors voted in favour of paying a dividend of $0.10 per share, which will be paid on November 6, 2000, to all shareholders of record as at October 16, 2000.
Profile
Founded in 1975, GL&V is a world leader in the design and manufacture of engineered proprietary equipment for the pulp and paper industry and other strategic markets, consisting mainly of chemicals, food, mining, minerals, energy and the environment. The Company holds the proprietary rights to most of the machinery used in its customized technological solutions. Its equipment is manufactured primarily in its plants in North America, as well as by various subcontractor partners. GL&V's network extends into more than 40 countries on five continents. The Company has operations and/or sales representatives in Canada, the United States, Europe, Australia, Africa, Asia, and South America, in addition to sales agents in most industrialized regions. GL&V employs close to 1,400 people worldwide.
For information:
Laurent Verreault
Chairman of the Board,
President and Chief Executive Officer
GL&V
Tel: (514) 284-2224
William Saulnier
Vice-President, Finance and Administration
GL&V
Tel: (819) 371-8265
Provided by: GL&V Pulp and Paper Group