This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

General Finance Corporation Expands North American Leasing Operations With Strategic Acquisition Of Portable Liquid Storage Tank Container Assets

PASADENA, Calif., March 3, 2014 (GLOBE NEWSWIRE) -- General Finance Corporation (Nasdaq:GFN), the parent company of businesses in the mobile storage, modular space and liquid containment industries (the "Company"), today announced that it has entered into a definitive agreement to acquire substantially all the assets and assume certain liabilities of the affiliated companies, Lone Star Tank Rental LP, based in Kermit, Texas, and KHM Rentals, LLC, based in Kenedy, Texas, (collectively "Lone Star") for a total purchase consideration of $95 million, subject to certain working capital and other adjustments to be determined after the closing date.

Lone Star leases portable liquid storage tank containers and containment products, as well as provides certain fluid management services, to the oil and gas industry in the Permian and Eagle Ford basins of Texas through a fleet of more than 1,200 units. Unaudited revenues for Lone Star for the year ended December 31, 2013 totaled $45 million.

"This business combination creates an exciting opportunity for us," said Ronald F. Valenta, Chief Executive Officer of General Finance Corporation. "Lone Star is led by an experienced and motivated management team and will be a strong fit with our North American leasing operations, enabling us to expand our level of services to our portable liquid storage tank container customers and further bolster our presence in the oil and gas industry. We believe this acquisition will position us to capitalize on the growth opportunities in our country's key energy producing regions across Texas and to strengthen our capacity for increased revenue growth, profitability, and attractive shareholder returns."

The purchase price multiple is approximately 5.8 times Lone Star's adjusted EBITDA (earnings before interest, income taxes, depreciation and amortization) for the year ended December 31, 2013. Of the total purchase consideration, the sellers will receive $75 million in cash, $10 million in shares of the Company's common stock (the amount of which will based on the average of the closing per share market price during the 15-day trading period ending three days prior to the closing date of the transaction), $5 million payable over five years for a non-compete agreement, and $5 million payable over two years for a general indemnity holdback. The Company expects that the cash portion of the consideration payable at closing will be satisfied by $10 million from existing cash resources, $40 million from availability under an amended and expanded North American senior credit facility, which is currently at Pac-Van, and $25 million at the corporate level from a two-year secured term loan. 

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG

Markets

DOW 18,132.70 -81.72 -0.45%
S&P 500 2,104.50 -6.24 -0.30%
NASDAQ 4,963.5270 -24.3630 -0.49%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs