FirstOnSite Restoration G.P. Inc. (the general partner of FirstOnSite Restoration L.P.), Canada's largest independent disaster restoration services provider, has announced that it has reached a definitive asset purchase agreement with U.S.-based Interstate Restoration LLC, subject to court approval, under which Interstate Restoration will acquire FirstOnSite. The terms of the agreement are not being disclosed at this time.

 

The combination of FirstOnSite and Interstate Restoration will create the second largest independent North American restoration and reconstruction services provider, giving it greater breadth of capabilities and resources to compete more effectively and to provide the highest quality service to clients. With 19 branch locations across the United States, Interstate Restoration is one of the largest emergency restoration and reconstruction service providers for commercial enterprises.

 

"By combining FirstOnSite and Interstate Restoration, we will significantly improve our ability to deliver to our clients uninterrupted, best-in-class restoration and reconstruction services on both sides of the border," said Stacy Mazur, CEO, Interstate Restoration. "The combined companies bring financial strength, a broader customer base and a wide array of resources, talented personnel and new proficiencies. FirstOnSite is well known for its experienced workforce and brings a complementary culture that focuses on rebuilding lives after disasters. Together, we will have the scale necessary to respond to commercial and residential emergencies across Canada and the U.S., from localized disasters to major catastrophes."

 

"Our vision has always been to be the first and best choice for insurers, property owners and employees. Interstate Restoration brings exceptional industry and operational expertise, and this sale allows us to join forces and serve customers across the continent," said Dave Demos, CEO of FirstOnSite Restoration. "Interstate Restoration complements our Canadian service, and we intend to work together to share best practices across the border."

 

The transaction, which has the full support of each company's board of directors and FirstOnSite's key financial stakeholders, will be implemented by way of proceedings under the Companies' Creditors Arrangement Act (CCAA). As such, today, FirstOnSite sought and has been granted an order by the Ontario Superior Court of Justice for a stay of proceedings under the CCAA.

 

The companies expect the transaction to close in less than two months. Delos Capital, a U.S.-based private equity fund, will provide Interstate Restoration with committed financing for the transaction.

 

"As part of our strategy of backing the best management teams in their respective industries, we are proud to support the Interstate Restoration team and FirstOnSite to continue to build the best-in-class restoration company in North America," said Matt Constantino, founder of Delos Capital.

 

Alvarez & Marsal Canada Securities ULC acted as FirstOnSite's financial advisor and investment banker in the sale and investment solicitation process. Under the terms of the Initial Order, FTI Consulting Canada Inc. will serve as the Court-appointed Monitor of FirstOnSite. Details of the CCAA filing and related matters will soon be available on the Monitor's website.