Bird Construction Inc. has signed an agreement to acquire all of the outstanding shares of H.J. O’Connell, Limited for approximately $77.5 million. The purchase price and related transaction expenses of $1 million will be funded with approximately $33.5 million of existing working capital, $30 million through equipment financing and $15 million by way of vendor take back financing. The acquisition is expected to be completed on or about August 31.
H.J. O’Connell has been involved in the heavy construction, civil construction and contract surface mining sectors since 1931 with operations in Newfoundland & Labrador, Northern Quebec and Manitoba. There is no geographic market sector overlap between the current operations of Bird and H.J. O’Connell. Its diversified business includes expertise serving the mining, energy, industrial, and infrastructure construction markets, with specialization in northern and remote site related projects. Certain key members of H.J. O’Connell’s executive and management teams have agreed to remain as employees and to assist Bird in the management of H.J. O’Connell’s ongoing growing operations.
H.J. O’Connell operates a large fleet of heavy civil and mining equipment in support of its construction and mining operations. The equipment and expertise in earthwork and surface mining that H.J. O’Connell brings will permit Bird to expand its civil industrial business into new scopes of work. As well, Bird’s recognized expertise in industrial building construction creates excellent opportunities to expand the services offered to H. J. O’Connell’s loyal customer base. H.J. O’Connell’s unaudited earnings for its year ended May 31, 2011 were $13.8 million.