Enerflex Systems Income Fund
TSX : EFX.UN

Enerflex Systems Income Fund

July 06, 2007 09:05 ET

Enerflex Announces Letter of Intent to Acquire Kentech Group

CALGARY, ALBERTA--(Marketwire - July 6, 2007) - Enerflex Systems Income Fund (TSX:EFX.UN), a leading supplier of products and services to the global energy sector, today announces it has entered into a letter of intent in support of its worldwide growth strategy.

Enerflex has entered into an exclusive letter of intent to acquire a 100% interest in Kentech Group Holdings Ltd. and its subsidiaries ("Kentech Group"), headquartered in the Republic of Ireland. The letter of intent provides that the parties will proceed in good faith to enter into a definitive purchase and sale agreement by mid September 2007.

Kentech Group is a privately-owned multi-national company. Enerflex President & CEO, Mr. J. Blair Goertzen, noted that, "Kentech Group is a specialized engineering, procurement, construction, commissioning and maintenance organization providing mechanical, electrical, instrumentation and telecommunications services to the global energy sector with scale and reach in the Middle East, Europe and the Former Soviet Union that aligns extremely well with Enerflex's strategic plan."

Mr. Goertzen further stated, "We are excited about the potential this acquisition brings to our regionalization strategy. Kentech Group has a solid, experienced management team in all of its international locations. Further, the culture and core values of each company are very similar, which will enable us to quickly move forward with a clear unified focus. There is a wealth of opportunities available to the combined organizations that position us for further expansion."

Kentech Group currently has operations in the Middle East (Kuwait, Qatar and Dubai and Abu Dhabi in the United Arab Emirates), the Former Soviet Union (Azerbaijan, Kazakhstan and Sakhalin Island, Russia) and Latin America. Kentech Group's revenue for the year ended December 31, 2006 was approximately $80 million.

Enerflex continues its due diligence review with closing of the transaction expected in mid September 2007.

Enerflex Systems Income Fund is a leading supplier of products and services to the global oil and gas production industry. Our core expertise lies between the wellhead and the pipeline. Enerflex provides natural gas compression, power generation and process equipment for sale or lease, hydrocarbon production and processing facilities, electrical, instrumentation and controls services and a comprehensive package of field maintenance and contracting capabilities. Through our ability to provide these products and services in an integrated manner, or as standalone offerings, Enerflex offers its customers a unique value proposition.

Headquartered in Calgary, Canada, Enerflex has approximately 2,700 employees. Enerflex, its subsidiaries, interests in affiliates and joint-ventures operate in Canada, Australia, the Netherlands, the United States, Germany, Pakistan, Egypt, Indonesia and Malaysia. Enerflex's trust units trade on the Toronto Stock Exchange under the symbol "EFX.UN".

Forward-Looking Statements

Certain information contained herein constitutes forward-looking information under applicable securities laws. All statements, other than statements of historical fact, which address activities, events or developments that we expect or anticipate may or will occur in the future, are forward-looking information. Forward-looking information typically contains statements with words such as "seek", "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "project", "potential", "targeting", "intend", "could", "might", "should", "believe" or similar words suggesting future outcomes or outlook. The following discussion is intended to identify certain factors, although not necessarily all factors, which could cause future outcomes to differ materially from those set forth in the forward-looking information. The risks and uncertainties that may affect the operations, performance, development and results of Enerflex's businesses include, but are not limited to, the following factors: the impact of general economic conditions; industry conditions, including the adoption of new environmental and other laws and regulations and changes in how they are interpreted and enforced; volatility of oil and gas prices; oil and gas product supply and demand; risks inherent in Enerflex's ability to generate sufficient cash flow from operations to meet its current and future obligations; increased competition; the lack of availability of qualified personnel or management; labor unrest; fluctuations in the foreign exchange or interest rates; stock market volatility; opportunities available to or pursued by Enerflex and other factors, many of which are beyond the control of Enerflex.

The reader is cautioned that these factors and risks are difficult to predict and that the assumptions used in the preparation of such information, although considered reasonably accurate by Enerflex at the time of preparation, may prove to be incorrect or may not occur. Accordingly, readers are cautioned that the actual results achieved will vary from the information provided herein and the variations may be material. Readers are also cautioned that the foregoing list of factors and risks is not exhaustive. Additional information on these and other risks, uncertainties and factors that could affect Enerflex's operations or financial results are included in our filings with the securities commissions or similar authorities in each of the provinces of Canada, as may be updated from time to time. There is no representation by Enerflex that actual results achieved will be the same in whole or in part as those set out in the forward-looking information. Furthermore, the forward-looking statements contained herein are made as of the date hereof, and Enerflex does not undertake any obligation to update publicly or to revise any forward-looking information, whether as a result of new information, future events or otherwise, unless required by law. Any forward-looking information contained herein is expressly qualified by this cautionary statement.

Contact Information

  • Enerflex Systems Income Fund
    P. John Aldred
    Executive Chairman
    (403) 236-6800
    (403) 236-6816 (FAX)
    or
    Enerflex Systems Income Fund
    J. Blair Goertzen
    President & CEO
    (403) 236-6800
    (403) 720-4385 (FAX)
    or
    Enerflex Systems Income Fund
    Gail P. Boehm
    Interim Vice-President & CFO
    (403) 236-6800
    (403) 720-4385 (FAX)
    or
    Enerflex Systems Income Fund
    Sidney G. Mose
    Vice-President Business Development
    (403) 236-6800
    (403) 720-4385 (FAX)