Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) recently priced its $25 million worth offering of Senior Notes due February 1, 2019. Subject to customary closing conditions, the company expects this offering to be completed on November 24, 2014. The Notes were priced at 99.5% of face value, plus unpaid interest and pre-issuance accrued from August 1, 2014.
Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) plans to use the net proceeds to repay indebtedness under its senior secured revolving credit facility and for general corporate purposes. The indebtedness incurred in connection with the company’s recent acquisition of Magnus Pacific Corporation, where Great Lakes paid $25 million in cash at closing.
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The Acquisition
Magnus’ acquisition is estimated to add about $118 million of revenue in the current year to Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD). The acquisition will also contribute $90 million to the company’s backlog.
Magnus brings wide range of competencies and geographic footprint across Denver, Dallas and Seattle. Magnus offers geotechnical and environmental solutions including mine reclamation, wetlands improvements, slurry wall construction and ground stabilization.
Jon Berger, CEO of Great Lakes, said that the acquisition will facilitate the company’s strategy to become a ‘preeminent’ environmental services provider. It will broaden the company’s suite of capabilities and help build on the success of Terra Contracting and dredging business.
The Financials
Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) ended 3Q14 with backlog of $470.6 million and cash and cash equivalents of $21.08 million. The company’s dredging revenues increased 7.5% to $167.1 million and environmental & remediation revenue increased 2.9% to $37.2 million during the quarter. Great Lakes’ dredging business was impacted by lower utilization in the coastal protection market and several other factors.
Mr. Berger said that the company is focusing to grow environmental & remediation segment and Magnus Pacific acquisition will add to its growth. The segment performed well and executed several large jobs during 3Q14.
