Laval, Quebec, September 11, 2014 – Savaria Corporation (TSX: SIS) (“Savaria” or the “Corporation”), North America’s leader in the accessibility industry, today announced the purchase of Silver Cross for a cash consideration of $4.7 million of which $2.5 million is payable immediately and $2.2 million is payable in eight semi-annual installments beginning in six months.
Silver Cross operates a highly successful lead generation program to capture and distribute leads to over 100 affiliates in North America. The business also operates a total of 18 stores including 17 franchise locations, predominantly in Ontario and with four locations in the United States. Silver Cross sells both new and recycled home accessibility equipment and has built a reputation as a trusted source for its clientele in meeting their personal mobility needs.
“Savaria sees tremendous value in the Silver Cross business on several fronts, including the opportunity to aggressively grow the scalable lead generation program that will enhance the business of Savaria dealers and Silver Cross franchisees and its affiliates. We would also like to pursue growth by increasing the number of Silver Cross franchise locations in North America”, said Marcel Bourassa, President and CEO of Savaria.
“With the expertise and backing of Savaria, Silver Cross can expand more quickly in meeting the needs of the rapidly growing seniors market, a market that is looking for high quality, good value and exceptional service. We want to be the go-to source in markets where there is opportunity to fill this gap,” said Silver Cross founder Robert Harvey.
“I am confident that this acquisition will increase our earnings before interest, taxes, depreciation and amortization ("EBITDA") by $1.5 million in 2015 through increased sales of Savaria products, increased volume of leads and related synergies with our brand. Therefore, the Board of Directors has approved an increase to the quarterly dividend of 14% to 4 cents ($0.04) per common share, effective immediately”, concluded Mr. Bourassa.
Founded in 1997, Silver Cross developed a unique position in the home healthcare equipment sector by offering both recycled and new products. The business also pioneered internet search marketing optimization strategies to capture consumers looking for information in the home healthcare sector. Silver Cross will be a new division of Savaria, and Robert Harvey will remain with Silver Cross to assist the Savaria management team with its business development strategy for North America.
Savaria Corporation (savaria.com) is North America's leader in the accessibility industry focused on meeting the needs of people with mobility challenges. Savaria designs, manufactures, installs and distributes primarily elevators for home and commercial use, as well as stairlifts and vertical and inclined platform lifts. In addition, it converts and adapts minivans to be wheelchair accessible. The diversity of its product line, one of the world’s most comprehensive, enables the Corporation to stand out by proposing an integrated and customized solution for its customers’ mobility needs. Its operations in China have substantially grown and the collaboration with Savaria’s other Canadian facilities increases its competitive edge in the market place. The Corporation records some 60% of its revenue outside Canada, primarily in the United States. It has a sales network of some 600 retailers in North America and employs some 410 people at its head office in Laval and at its plants and sales offices in Montreal (Quebec), Brampton and London (Ontario), Calgary (Alberta) and Huizhou (China).
Forward looking statements
Certain statements may constitute forward-looking statements. Such forward-looking statements involve risks, uncertainties and other factors, which may cause actual results, performance or achievements of the Corporation to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements.
For more information, please contact:
Helene Bernier, CA
1-800-931-5655, ext. 248
Chairman of the Board, President and
Chief Executive Officer