Clearford Water Acquires UV Pure

Clearford Water Systems Inc. Announced the Acquisition of a 90.5% Interest in UV Pure Technologies Inc., a Toronto-Based Manufacturer and Distributer of Ultraviolet Systems for the Purification of Potable Water, Grey Water and Wastewater, Based on Its Proprietary Crossfire™

Clearford Water Systems Inc. ("Clearford" or the "Company"), (TSX-V: CLI), today announced the acquisition of a 90.5% interest in UV Pure Technologies Inc. ("UV Pure"). UV Pure is aToronto-based manufacturer and distributer of ultraviolet systems for the purification of potable water, grey water and wastewater, based on its proprietary Crossfire™ technology, with over 14,000 systems installed. UV Pure has averaged approximately 10% annual revenue growth with positive operating earnings in each of the past 5 years. Operating earnings for the fiscal year endedMay 31st, 2014 were$374,000on revenues of$2.9 million(determined using Canadian Accounting Standards for Private Enterprises). Following the completion of the acquisition UV Pure will have no debt.

Clearford will acquire 90.5% of all outstanding shares of UV Pure for a cash payment of$2.5 million, subject to adjustments at closing. UV Pure's management team will retain the remaining shares of UV Pure. UV Pure will operate as a corporate subsidiary of Clearford, under the leadership of its President and CEO,Richard (Rick) Vansant. Clearford is funding the acquisition and adding to working capital by sale of a mortgage loan receivable and additional long-term debt. Clearford is providing today an$800,000non-refundable deposit which will be applied against the purchase price. The transaction is expected to close on or beforeDecember 10th, effectiveOctober 31st, 2014, subject to the approval of the TSX Venture Exchange.

The market for ultraviolet purification of water and wastewater is estimated to be over$1 billionannually, with growth forecasted at 14% annually by independent market research firms. UV Pure's product line is based on proprietary Crossfire™ technology that is a generational step ahead of the technology used by competitors. The product line is lower in capital and operating cost per unit of water flow, easier to install, and both easier and cheaper to maintain.

Clearford is currently the distributor of UV Pure's products inColombia, and sees the acquisition as a strategic addition to ClearRecover™, the final step in the Company's Clearford One™ wastewater collection and treatment system to deliver clean and pure water.

Mr.Kevin Loiselle, President and CEO of Clearford, commented: "We are very excited to add UV Pure and its Crossfire™ technology to the Clearford family. Our experience asColombiadistributor has demonstrated that there is a robust worldwide market for this technology. Test results using Crossfire™ directly on ClearDigestTMeffluent delivered through ClearConvey™ indicate that the Clearford OneTMsystem can produce treated and disinfected water to meet the needs of many areas in the developing world without the need for a wastewater treatment plant. We look forward to introducing UV Pure toIndiaand other international markets.

Mr.Richard Vansant, President and CEO of UV Pure, welcomed the opportunity to build the market position of Crossfire™ in cooperation with Clearford: "Our leadership team is excited to begin the next chapter of UV Pure's growth story in partnership with Clearford Water Systems. The technologies of both companies are targeted toward distributed treatment applications for municipal, industrial and commercial customers, the fastest growing segment of the global market. We believe that the combination of Clearford One™ and Crossfire™ will leverage the strengths of Clearford and UV Pure to maximum advantage", Mr. Vansant said.

Source: DigitalJournal

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Taxonomy

• Business Expansion
• Technology
• Ultraviolet