The Company is a diversified, acquisition-oriented corporation focused on acquisition opportunities in the industrial products and transportation sectors, in particular businesses that are suited for public markets, except for their size. The business plan of the Company is to invest in profitable, well-established companies with strong cash flows operating in niche markets . The objectives of the Company are:
(i) to provide Shareholders with stable and growing cash dividends;
(ii) to maximize Share value through on-going active monitoring of its Operating Subsidiaries; and
(iii) to continue to acquire additional companies or businesses or interests therein in order to expand and diversify the Company’s investments.
The Company’s acquisition strategy is to target strong niche businesses with strong cash flows, which acquisitions are well suited for public markets as income generating vehicles, except for their size. The Company seeks to acquire businesses with the following characteristics: (i) attractive margins; (ii) defensible market position; (iii) low maintenance capital expenditures; (iv) identifiable competitive advantage(s); and (v) barriers to market entry by competitors. The Company seeks to retain the key management personnel following acquisitions and have such key management personnel own an equity interest in the Company. Management believes that profitable, well-established family-owned or closely held businesses with strong cash flows and which operate in niche markets present an attractive investment opportunity due to the fact that many such businesses do not have a succession plan. Management believes that the Company will be able to continue to implement its investment strategy of acquiring businesses with these characteristics to provide additional cash flow and further enhance long-term Shareholder value.
Attributes of target companies:
- Profitable, mid-market companies with an emphasis on manufacturers or processors.
- Strong management team
- Demonstrable growth opportunity
- Sustainable annual EBITDA with a diverse customer base.
Purchase prices are based on a multiple of historical sustainable EBITDA.
Implementation of Acquisition Strategy
Since its inception to the date hereof, the Company has completed a number of acquisitions spread over that time. The timing of each acquisition is noted below in the subsidiary description below.
The Company currently owns Operating Subsidiaries in three niche business segments:
(ii) Specialty Manufacturing; and
(iii) Infrastructure .
The Operating Subsidiaries operate autonomously and maintain their individual business identities. The Company relies on the high quality management teams of its Operating Subsidiaries and does not rely on operating synergies to justify acquisitions.
It is the intention of management to continuously monitor the Company’s Operating Subsidiaries, and to undertake future acquisitions and divestitures as deemed beneficial to the Company.
Internal Growth Strategy
The Company closely monitors management of the Operating Subsidiaries to ensure that the Operating Subsidiaries continue to have sound business operations and expansion strategies, where appropriate. Management seeks to identify and exploit potential synergies among the Company’s Operating Subsidiaries.
The Operating Subsidiaries of the Company on the date hereof are listed below. For a more extensive description of each of the Operating Subsidiaries, please refer to our subsidiaries section of this website.
Perimeter Aviation LP (acquired in 2004)
Perimeter operates a scheduled airline service to northern Manitoba communities. Perimeter operates its scheduled airline service out of its main terminal and cargo facility located at the Winnipeg International Airport. In addition to the scheduled airline service, Perimeter also: (i) provides medevac services to northern communities; (ii) operates a flight training school specializing in commercial instrument flight rating licenses; and (iii) undertakes charter work on behalf of major courier companies.
4873999 Manitoba Ltd. (acquired in 2004)
4873999 Manitoba, owns fuel tank assets that are used by the airline service operations of Perimeter.
Keewatin Air LP (acquired in 2005)
Keewatin operates an airline and medevac services business that serves communities in Manitoba and Nunavut.
Calm Air International LP (acquired in 2009)
Calm Air operates a scheduled airline service to Nunavut and northern Manitoba communities. In addition to its scheduled service, Calm Air provides dedicated cargo and chartered services. Calm Air provides its services from its three main bases in Winnipeg, Thompson and Churchill, Manitoba.
Bearskin Lake Air Service LP (acquired in 2011)
Bearskin operates a scheduled airline service in Ontario and Manitoba. Bearskin utilizes a common aircraft type throughout its operations that are suited for regional travel that it serves.
Custom operated a fleet of helicopters used to provide passenger and cargo transportation services to government agencies, utilities, First Nations groups, mining companies and other customers. Custom operates out of five bases, including Winnipeg, Thompson, Gillam, and Garden Hill in Manitoba and Rankin Inlet in Nunavut.
Regional One Inc. (acquired in 2013)
Based out of Florida, Regional One is focused on supplying regional airline operators around the world with various after-market aircraft, engines, and component parts.
Overlanders Manufacturing LP (acquired in 2006)
Overlanders is an ISO-9001 certified manufacturer of precision sheet metal and tubular products serving companies in a diversified mix of industries in British Columbia and the Pacific Northwest of the United States.
Water Blast Manufacturing LP (acquired in 2007)
Water Blast manufactures specialized heavy-duty pressure washer and steam systems, and is the exclusive distributor in its geographic market of Alberta, British Columbia the Northwest Territories, south-eastern Saskatchewan, and North Dakota for Hotsy pressure washer cleaning equipment, which is used for a variety of light commercial and heavy duty industrial applications.
In December 2011 certain reorganization transactions took place between Water Blast and another subsidiary of the Company, Jasper Tank Ltd. (originally acquired in 2005). The operating assets of Jasper Tank, who is a manufacturer located in Spruce Grove, Alberta which specializes in manufacturing custom tanks for the transportation industry, was transferred to Water Blast and Jasper Tank Ltd was wound up into the Company.
Stainless Fabrication, Inc. (acquired in 2008)
Stainless Fabrication, a Missouri state corporation, is the custom designer and manufacturer of stainless steel tanks, vessels and processing equipment for the pharmaceutical, chemical, ethanol, food and beverage, dairy and transportation industry.
WesTower Communications (acquired in 2011)
WesTower Communications operates throughout Canada and United States in the wireless communication industry, mainly in the design, erection, reinforcing, maintenance and servicing of towers and related equipment. The operations of WesTower Communications are spread over Canada and the United States.
For a detailed summary of the Operating Subsidiaries and their respective businesses, see “Narrative Description of the Business” in the Company’s Annual Information Form.