Rand Buys Two Integrated Tug/Barge Units from KK
The acquisition was structured with $35.5m cash paid at closing (including $31m financed with third party debt), $5.1m of attractively priced junior seller paper and 1,305,963 shares of the company's common stock.
Laurence Levy, chairman and CEO of Rand, said: â€œWe are very enthusiastic about this highly strategic acquisition and expect that it will result in an additional $0.25 to $0.30 in free cash flow per common share for our fiscal year ending March 31, 2012.â€
Scott Bravener, president of Lower Lakes, said: â€œThe acquisition of these vessels allows us to expand our fleet at a price well below replacement cost, improve the profitability of our existing fleet by better aligning our assets to the trade patterns that they are best suited for and provides for greater flexibility in the scheduling of our vessels. Given our current order book as well as additional customer demand expected in connection with the acquisition, the two vessels are fully booked for the upcoming sailing season.
â€œIn addition, as a result of this acquisition we have elected to defer a drydocking and major capital expenditure program planned for this winter for our smallest, oldest and least profitable vessel. The continued growth of our Company enhances our competitive position as a leading provider of bulk freight shipping services throughout the Great Lakes region and illustrates our long-term commitment to our customers, employees and shareholders.â€
Will the acquisition benefit Rand?
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