Finning to acquire Kramer Cat
By Andrew Macklin
May 7, 2015 – Finning International Inc. announced it has reached an agreement to purchase the operating assets of the Cat dealership of Kramer Ltd. for approximately $230 million, subject to working capital adjustments. In 2014, the acquired dealership business generated approximately $275 million in revenue.
Finning will become the approved Cat dealer in Saskatchewan in July of this year, subject to customary closing conditions. After a remarkable 70 years of service in Saskatchewan, the Kramer family has decided to retire from the equipment dealership business.
“It’s been an honour to lead the Kramer Cat dealership for the past 23 years and I am proud of our organization’s many accomplishments,” says Tim Kramer, President of Kramer Ltd. “Having spent considerable time with members of the Finning team, I am confident Finning will be a great addition to the province of Saskatchewan and our employees are joining a successful Canadian business that cares about its employees, customers and the community.”
This acquisition combines complementary capabilities, customer bases and highly skilled employees across Finning’s territory in British Columbia, Alberta, Yukon, Northwest Territories and part of Nunavut with Kramer’s presence in Saskatchewan.
“Expanding Finning’s Western Canadian operations into Saskatchewan is a great strategic fit and represents a compelling growth opportunity for our company, employees, customers and shareholders,” says Scott Thomson, President and CEO, of Finning International. “We have great respect for the Kramer family legacy and everything they have achieved. We will build on their strong heritage by growing the business, providing our customers with a terrific experience, and contributing to communities in Saskatchewan. This acquisition is also a testament to our current Finning employees in Canada who have worked tirelessly to put us in the strategic and financial position to make this opportunity possible.”
The two companies already share common customers who operate across these adjacent territories and will benefit from the continuity and support of a single dealer. Customers will also benefit from improved equipment and parts availability, world-class product support and access to Finning’s extensive branch network of 50 locations.
For Finning, Saskatchewan is a highly attractive growth opportunity that diversifies its revenue base into sectors such as potash and uranium. The acquisition will be funded with cash and will be immediately accretive to earnings per share.
Joining Finning is a talented and dedicated team of 475 Kramer employees with a deep understanding of the local market and well-established customer relationships throughout the province at parts, sales and service locations in Estevan, Kindersley, Battleford, Regina, Saskatoon, Swift Current and Tisdale in addition to Cat Rental Stores in Regina and Saskatoon.
Tony de Sousa has been named the executive to lead Finning Saskatchewan. He will be based in the Saskatchewan headquarters, which will remain in Regina. Tony has been with Finning for 39 years and has extensive senior leadership experience in sales, service and operations. Tony and his family will move from Edmonton to Regina.