Compact Power Equipment Centers to raise growth funds in Canada
By Murray Pollok09 September 2011
Compact Power Equipment Centers, the company that provides rental services at 280 Home Depot stores in the US, is to raise up to C$25 million by floating on the TSX-Venture Exchange in Toronto, Canada.
The majority of the funds will be used by Compact Power to continue with the expansion of its rental operations at Home Depot stores.
Roger Braswell, president and chief executive officer of Compact Power, told IRN that the Toronto market was a good place for small companies to raise funds.
The transaction values Compact Power at C$20 million, and funds of up to C$25 million will be raised when the flotation is completed.
Mr Braswell said the rental business has been expanding steadily since it won the contract with Home Depot in late 2009. The initial aim was to provide rental services at 110 locations and that had grown to 170 locations last year. Currently the business has rental stories at 280 Home Depot stores.
"We have 280 stores in 17 States, and our intention is to grow the business in the US and Canada, so we have quite a long way to go", he said. Being a listed company will make it easier to raise growth funds in the future, said Mr Braswell.
Compact Power used financial advisors to identify a ‘capital pool company' - Snow Eagle Resources - to enable it to float. Capital pool companies are businesses with no operations that are created to make it easy for small companies to go public. Compact Power and Snow Eagle will combine and the new entity's shares will trade on the TSX-Venture Exchange.
Compact Power rents mini-skid loaders, aerial equipment, loaders, mini excavators, trenchers, aerators, chipper shredders and stump grinders at the Home Depot locations.
A Compact Power subsidiary, Compact Power Services, employs 240 technicians in the US and Canada to maintain and repair the rental fleet and also provide repair and maintenance services to clients including Best Buy, Boeing, GE, Home Depot, Levolor, Office Depot, Siemens, Target and Walmart.