[Chem News]
NEWS RELEASE TRANSMITTED BY CANADIAN CORPORATE NEWS
FOR: AMERICAN ECO CORPORATION
TSE SYMBOL: ECX
NASDAQ SYMBOL: ECGOF
MARCH 4, 1997
American Eco Completes Chempower Merger
HOUSTON, TEXAS--American Eco Corporation and Akron, Ohio based
Chempower, Inc. (NASDAQ - CHEM) announced that Chempower, Inc.,
have completed a merger with a subsidiary of American Eco whereby
Chempower shareholders received consideration of US$6.20 per share
for approximately 7.8 million shares of Chempower. The total cost
to American Eco was partially funded by a placement by American
Eco of US$15.0 million 9.5 percent 10 year Convertible Debentures,
to US institutional investors convertible after 181 days into the
common shares of American Eco at a price based on a formula of the
market price of the shares at the time of conversion. In
addition, certain of the principal shareholders of Chempower, Inc.
agreed to take US$19.9 million of one year notes in lieu of cash.
The merger agreement had been previously approved by Chempower
shareholders and requisite regulatory authorities.
Michael E. McGinnis, President & CEO of American Eco stated,
"Chempower's profitable domination of power generation maintenance
and construction services in the Midwest and Northeast
significantly enhances American Eco's market penetration and
geographic coverage for its multi-national clients. In addition,
Chempower strengthens American Eco's financial position through
their annuity type contracting relationships balancing risk as
they pertain to backlogs."
Chempower which is a major service contractor in the utility
industry, was founded by Toomas J. Kukk, Chairman and CEO who
continues as the senior executive of Chempower.
Chempower is a manufacturing, construction and environmental
services company for the power generation industry through
subsidiaries in 14 eastern US States from New Jersey to Indiana in
the mid-west and Alabama in the south. Specific products and
services include, insulation, fabrication, mechanical construction
and abatement. In the year ended December 31, 1995, Chempower had
earnings of US$2.2 million on revenues of US$78.7 million, with
current maintenance contracts and a manufacturing backorder
position of approximately US$25.0 million. This acquisition will
constitute a 17 percent increase in American Eco's current backlog
position.
American Eco is a leading North American provider of single source
construction, engineering, management, maintenance, and
environmental remediation services in the refining, petrochemical,
utility, and forest products industries.
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