July 20, 2011Insituform Technologies Inc. (nasdaq global select market:INSU) has announced that in addition to the recent organic growth initiatives of its Energy and Mining group in the Middle East, it has closed on the acquisition of CRTS Inc., an Oklahoma company (CRTS), and executed definitive agreements to acquire Hockway Ltd. and Hockway Middle East FZC, based in the United Kingdom and UAE, respectively (collectively, Hockway).
Insituform president and CEO Joe Burgess stated, “These acquisitions will strengthen and expand Insituform’s Energy and Mining group’s presence and capabilities in the Middle East, North America and Brazil. CRTS has performed significant work in Saudi Arabia over the past few years and we expect it to continue to expand its presence in Saudi Arabia and other countries in the Middle East.
“Additionally, we believe that CRTS’s patented and other proprietary robotic pipe coating technologies distinguish the company from its competitors and allow the company to achieve compelling production efficiencies in both onshore and offshore pipe coating projects. Hockway, which has operated in the United Kingdom since 1975, established a base of operations in Dubai in 2009. From its Dubai office, Hockway provides cathodic protection products and services throughout the Middle East, including Iraq.
“These acquisitions complement Insituform’s organic growth in the Middle East, which includes an office opened in Oman in January 2010, significant projects performed by United Pipeline Systems in the Middle East over the past several years, Corrpro Companies’ long-term relationship with and work for Kuwaiti Oil Co. and the recently announced joint venture in Saudi Arabia between Saudi Trading & Research Co., Ltd. and Corrpro Companies.”
CRTS, a privately-held company based in Tulsa, Okla., delivers proprietary internal and external coating services and equipment for new pipeline construction projects from offices in North America, the Middle East and Brazil. For 2010, CRTS had total revenues of approximately $13.3 million and earnings before interest, taxes and depreciation (EBITDA) of approximately $3.8 million. The transaction closed on June 30.
CRTS president James A. Huggins said, “CRTS is excited about the opportunity this relationship represents. Insituform and its many business units are perfectly positioned to help us grow and increase the product offerings to both our customer bases. We share markets, customers and customer-focused product and service solutions.”
Hockway was established in the United Kingdom in 1975 to service the cathodic protection requirements of British engineers working in the Middle East. In 2009, Hockway established operations in Dubai, United Arab Emirates. Hockway provides both onshore and offshore cathodic protection services in addition to manufacturing a wide array of cathodic protection components. For 2010, Hockway had total revenues of approximately $10 million and EBITDA of approximately $0.9 million. The transaction is expected to close on or around July 31, 2011 following approval from the regulatory authorities in the UAE.
Dorwin Hawn, Insituform senior vice president, Energy and Mining Division, said, “Since 2009, Insituform has been focused not only on the growth of our Energy and Mining businesses but on strategic expansion into the Middle East. We believe these transactions will accelerate our growth throughout the Middle East. In addition, the capabilities of CRTS and Hockway will strengthen the technical resources of our Energy and Mining team.”