Toromont Industries Ltd.
TSX : TIH

Toromont Industries Ltd.

September 01, 2005 18:11 ET

Toromont Sells Sterling Trucks Division

TORONTO, ONTARIO--(CCNMatthews - Sept. 1, 2005) - Toromont Industries Ltd. (TSX:TIH) announced today that it has sold the assets of its Sterling Trucks Division ("Sterling") to a subsidiary of Harper Detroit Diesel Limited.

Thanks to strong division leadership, excellent staff and the support of our customers Ontario Sterling has been the leading Sterling dealership in Canada for each of the past three years. However, at this time we have reached a crossroads - either grow the business by opening further locations and investing more capital - or continue to focus on our core Equipment Group businesses which include Toromont Cat and Battlefield (The Cat Rental Store) which have consistently provided Toromont with much stronger returns on our investment. "After careful consideration relative to Toromont's long-term strategic direction, we determined that our shareholders, employees and customers would all be better served if we sold this business unit to an industry participant and redeployed our capital into our other businesses," said Hugo T. Sorensen, President and Chief Executive Officer of Toromont.

Over the past twelve months, Ontario Sterling has accounted for approximately $50 million or about 3% of Toromont's annual consolidated revenues. The proceeds on sale of Sterling assets are estimated to be approximately $16 million, pending finalization of the August 31, 2005 accounts. Toromont expects to report a gain on the transaction of approximately one cent per share, to be included in third quarter 2005 results.

Toromont Industries Ltd. (TSX: TIH) operates through two business segments: The Equipment Group and the Compression Group. The Equipment Group includes one of the world's largest Caterpillar dealerships by revenue and geographic territory in addition to industry leading rental operations. The Compression Group is a North American leader specializing in the design, engineering, fabrication, and installation of compression systems for natural gas, fuel gas and carbon dioxide in addition to process systems and industrial and recreational refrigeration systems. Both groups offer comprehensive product support capabilities. Toromont employs approximately 4,000 people in more than 100 locations. This press release and more information about Toromont Industries can be found on the Web at www.toromont.com.

Contact Information

  • Toromont Industries Ltd.
    Wayne S. Hill
    Executive Vice President & Chief Financial Officer
    (416) 667-5776
    or
    Toromont Industries Ltd.
    Hugo T. Sorensen
    President & Chief Executive Officer
    (416) 667-5527