Atlas Engineered Announces Due Diligence Completion for Future Acquisition in Western Canada

Atlas Engineered Products (“Atlas”, “AEP” or the “Company”) announces that the Company has completed due diligence for a truss manufacturing company located in Western Canada (the “Target”) and intends to close the transaction in early Spring of 2025.

“We are excited to announce the completion of due diligence for the Target. This is the most robust M&A pipeline we have ever seen and now is the time to move forward with strategic acquisitions that expands our reach into new locations as we continue to grow our national footprint,” said Hadi Abassi, CEO & President, Founder. “We are progressing with acquisitions and steadily advancing our organic growth initiatives, including robotic implementation. Recently, we have expanded our sales team to capture more market share and enhance our sales presence in the U.S. market. These approaches ensure our continuous growth and expansion, aligning with both our short-term and long-term strategic goals.”

The Company will now start working on a share purchase agreement where AEP intends to acquire all the issued and outstanding shares of the Target (the “Proposed Transaction”) for the purchase price of $3.8 million in cash and stock, plus a working capital adjustment to be determined and finalized after closing of the transaction. The land and buildings on which the Target’s facilities are located will be leased from the current owners and terms will be finalized while working on the share purchase agreement. The Target generated a previous 3-year average revenues of over $11 million, net income of approximately $950,000 and non-IFRS measure adjusted EBITDA of approximately $1.15 million (see “Non-GAAP/Non-IFRS Financial Measures”). This Proposed Transaction will potentially be financed using a combination of the Company’s existing cash, common shares of the Company issued to the vendor, and bank financing. AEP is currently assessing which combination of financing is the best strategically for the short- and long-term growth plans of the Company.

This Proposed Transaction is aligned with the Company’s strategic acquisition plan and expands our geographical reach. AEP will bring its considerable operating synergies and material buying power to this anticipated new addition to the AEP group of companies.

The Company will release more details at time of closing of the Proposed Transaction which is targeted for early Spring of 2025. Closing of the Proposed Transaction also remains subject to a number of conditions, including the approval of the TSX Venture Exchange (the “Exchange”), if such approval is required under the rules and policies of the Exchange.

About Atlas Engineered Products Ltd.

AEP is a growth company that is acquiring and operating profitable, well-established operations in Canada’s truss and engineered products industry. We have a well-defined and disciplined acquisition and operating growth strategy enabling us to scale aggressively and apply new technologies, giving us a unique opportunity to consolidate a fragmented industry of independent operators.

Contact:

Jake Bouma – Representative for AEP – (604) 317-3936 – jake.bouma@atlasaep.ca

Source: Atlas Engineered Products Ltd.