A well-known northern trucking company, with its headquarters in North Bay, has been sold to a Toronto company called Titanium Transportation Group.
The transaction is expected to close on December 1.
ProNorth is based in North Bay, with additional terminals in Mississauga and Sudbury, and facilities in Timmins.
"It's all good," Ted Daniel, CEO of Titanium told BayToday. "It will create opportunity for ProNorth to expand."
When asked about possible layoffs, Daniel said, "Absolutely not. We're looking to grow. We're a public company with a lot of money in the bank to invest in our future growth and get our shareholders a good rate of return over the next five to 10 years.
"So no job losses, we're hoping to increase the amount of freight by using our ability to expand our network, not shrink it."
Daniel says there will be other acquisitions.
ProNorth was founded by Brian Glass in 1986 and has a well-established customer base throughout Ontario.
In a letter to employees, Glass said, "The sale will position ProNorth to become modern, competitive, efficient and will be able to better service its customer base, both present and future."
"Titanium provides a unique and compelling opportunity to participate in the rapid growth of a new generation transportation company. We are excited to be joining the Titanium team."
Glass will be a shareholder of Titanium.
ProNorth provides truckload van shipping services to over 250 customers, with 110 power units, 280 trailers and 150 employees and independent owner operators. The acquisition of ProNorth will increase Titanium's fleet size by over 30%, to a total of over 450 power units and over 1,200 trailers.
"We're a young company and we're looking to take good existing established companies that are looking into the next generation of companies," explained Daniel.
Under the terms of the definitive purchase agreement, Titanium will acquire all of the stock of ProNorth for total cash consideration of $5.8 million and 1,750,000 common shares. Upon closing, ProNorth is expected to have approximately $1.7 million of cash on hand. The remaining $4.1 million of the cash consideration will be funded using Titanium's existing credit facilities. The shares of Titanium to be issued in connection with the transaction will be subject to a two-year escrow arrangement.
Titanium will also be purchasing certain real estate used in the operation of ProNorth for the aggregate purchase price of $2.5 million. The purchase of the real estate will be funded using $250,000 of cash on hand and a $2.25 million nine year interest-free vendor-take back financing agreement.
Daniel added," This acquisition expands Titanium's geographic profile in Northern Ontario, allows for synergies with Titanium's existing lanes and Bracebridge terminal, and creates a platform for growth in the region. In addition, ProNorth's dry van business is highly complementary to Titanium's existing flatbed business in Northern Ontario."
Titanium services Canada and the United States, with approximately 350 power units, 1,000 trailers and 400 employees and independent owner operators.
The company has also been ranked by PROFIT magazine as one of Canada's Fastest Growing Companies for seven consecutive years.
