Mullen Group Ltd. To Acquire ContainerWorld Forwarding Services Inc.

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Jan 17, 2024, 06:00 ET

OKOTOKS, AB, Jan. 17, 2024 /PRNewswire/ - (TSX: MTL) Mullen Group Ltd. ("Mullen Group", "We", "Our" and/or the "Corporation") is pleased to announce that it has entered into a letter of intent ("LOI") to acquire Richmond, British Columbia based ContainerWorld Forwarding Services Inc. and its operating subsidiaries ("ContainerWorld"). The LOI contemplates standard due diligence and the execution of a purchase and sale agreement, both of which have been initiated. The transaction is scheduled to close in the second quarter of 2024, subject to regulatory approval and final closing conditions.

ContainerWorld is a Canadian logistics company that offers integrated supply chain solutions to the alcoholic beverage and hospitality industries. Through a network of customs and sufferance bonded warehouses, ContainerWorld provides: inventory management, freight forwarding, warehousing, and distribution services to international and domestic customers in the provinces of British Columbia and Ontario.

"The addition of ContainerWorld demonstrates our continued strategic focus of diversifying service offerings into verticals and markets that we consider as great long-term opportunities. Globally, alcoholic beverages is a trillion-dollar industry and here in Canada, it is a multi-billion dollar industry that is expected to grow as the Canadian population grows. ContainerWorld is a leading integrated logistics provider to international and domestic wine, beer and spirits producers that are looking for a safe and reliable customs bonded service provider in Canada. This acquisition further expands our operations in the provinces of British Columbia and Ontario, home to fifty percent of Canada's population, and will add over one million square feet of warehousing space to Mullen Group," said Mr. Murray K. Mullen, Chair and Senior Executive Officer.

"We are delighted to have ContainerWorld join our expanding logistics network. It is an excellent company with a long history, traits we consider important to our investment strategy. Founded by Dennis Chrismas, ContainerWorld has grown to be one of the largest alcoholic beverage logistics companies in Canada. I am also pleased to announce that Dennis Chrismas will continue in his current role and will oversee the business as we transition ContainerWorld from a private company to being part of a large public company," added Mr. Mullen.

ContainerWorld will operate within Mullen Group's Logistics & Warehousing segment ("L&W segment") and it is expected to generate annualized revenue of approximately $150.0 million. We expect operating income before depreciation and amortization ("OIBDA") margins to be consistent with the L&W segment, once we have implemented our disciplined business practices, process improvements and technology. Mullen Group will be funding the transaction from its existing credit lines.

About Mullen Group Ltd.

Mullen Group is one of Canada's largest logistics providers. Our network of independently operated businesses provide a wide range of service offerings including less-than-truckload, truckload, warehousing, logistics, transload, oversized, third-party logistics and specialized hauling transportation. In addition, we provide a diverse set of specialized services related to the energy, mining, forestry and construction industries in western Canada, including water management, fluid hauling and environmental reclamation. The corporate office provides the capital and financial expertise, legal support, technology and systems support, shared services and strategic planning to its independent businesses.

Mullen Group is a publicly traded corporation listed on the Toronto Stock Exchange under the symbol "MTL". Additional information is available on our website at www.mullen-group.com or on the Corporation's issuer profile on SEDAR+ at www.sedarplus.ca.

Contact Information

Mr. Murray K. Mullen - Chair, Senior Executive Officer and President
Mr. Richard J. Maloney - Senior Operating Officer
Mr. Carson P. Urlacher - Senior Accounting Officer
Ms. Joanna K. Scott - Senior Corporate Officer

121A - 31 Southridge Drive
Okotoks, Alberta, Canada T1S 2N3
Telephone: 403-995-5200
Fax: 403-995-5296

Disclaimer

Mullen Group may make statements in this news release that reflect its current beliefs and assumptions and are based on information currently available to it and contains forward-looking statements and forward-looking information (collectively, "forward-looking statements") within the meaning of applicable securities laws. This news release may contain forward-looking statements that are subject to risk factors associated with the overall economy and the oil and natural gas business. These forward-looking statements relate to future events and Mullen Group's future performance. All forward looking statements and information contained herein that are not clearly historical in nature constitute forward-looking statements, and the words "may", "will", "should", "could", "expect", "plan", "intend", "anticipate", "believe", "estimate", "propose", "predict", "potential", "continue", "aim", or the negative of these terms or other comparable terminology are generally intended to identify forward-looking statements. Such forward-looking statements represent Mullen Group's internal projections, estimates, expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. These forward-looking statements involve known or unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Mullen Group believes that the expectations reflected in these forward-looking statements are reasonable; however, undue reliance should not be placed on these forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. In particular, forward-looking statements include but are not limited to the following: (i) the close of the acquisition of ContainerWorld in the second quarter of 2024; and (ii) ContainerWorld will generate annualized revenue of approximately $150.0 million and OIBDA margins consistent with the Mullen Group's L&W segment. These forward-looking statements are based on certain assumptions and analysis made by Mullen Group in light of our experience and our perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. These assumptions include but are not limited to the following: (i) that Mullen Group will be satisfied with its due diligence review of ContainerWorld; (ii) that Mullen Group will receive the required regulatory approvals and that final closing conditions will be met; (iii) that Mullen Group will be able to execute on the transition of ContainerWorld from a private company to a large public company; (iv) that Mullen Group will be able to maintain the customers and sufferance bonds after the closing of the acquisition; and (v) that Mullen Group will be able to retain ContainerWorld customers and carry on business in the normal course after the closing of the acquisition. The forward-looking statements contained in this news release is expressly qualified by this cautionary statement. The forward-looking statements contained herein is made as of the date of this news release and Mullen Group disclaims any intent or obligation to update publicly any such forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable Canadian securities laws. Mullen Group relies on litigation protection for forward-looking statements.

SOURCE Mullen Group Ltd.