The Environmental Group Limited (ASX: EGL) had made an announcement about the acquisition of RCR Energy Service Assets with the help of the press release. It is also important to note that the company is engaged in the process of carrying out operations with the help of three business units namely Total Air Pollution Control, Baltec IES, and EGL Water. Coming to the company’s management, Ms. Lynn Richardson is the company’s Chairman, and Mr. David Cartney is the company’s Director (Non-Executive).
As per the press release dated January 7, 2019, Environmental Group had stated that they have joined hands with RCR Tomlinson Limited’s administrators with regards to the acquisition of RCR Energy Service’s assets. Coming to the funding requirements, there are expectations that, initially, the acquisition would be financed by using the present debt facilities of Environmental Group. Also, the acquisition might get wrapped up in the H1 of January 2019. RCR Energy Service extends customer services 24/7 like automation support, electrical as well as mechanical support. Let us now have a brief look at the past performance of RCR Energy Services.
RCR Energy Services has been delivering robust performance as it possesses strong profitability history and the company had garnered sales amounting to $21.5 million in FY 2018 and, during the same period, they have posted EBIT (or Earnings before interest and tax) amounting to $1.5 million. The issued press release also stated that the acquisition happens to be the strategy of Environmental Group Limited which focuses on having the presence in the each of the Australian state as well as the strategy of developing the environmental business to raise the water quality, enhance the waste to energy production, decrease the emissions of carbon as well as refine the quality of air. Also, the above-mentioned acquisition would allow Environmental Group to utilize its present products towards the customers of RCR Energy Services as well as the acquisition would also help in building the increased engineering capabilities.
RCR Energy Service’s senior management team would be joining the Environmental Group. The release which got issued also stated that the Environmental Group would be working towards tapping the acquisition as well as growth prospects which would be falling under the context of their environmental platform. With the help of these, the new and fresh shareholders, as well as the present ones, can able to take the benefits of their deployments which have been made in the Environmental Group.
Let have a look at the performance of Environmental Group’s stock. The last traded price of Environmental Group is A$0.035 per share, and its market capitalization happens to be $7.61 million. However, the annual dividend yield of Environmental Group stood at 1.71%. In the time horizon of the previous three months, the stock has delivered the return of -36.36% while over the last 6 months, the return was -5.41%.
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