Perma-Fix Environmental Services, Inc. announced it has signed a definitive agreement to acquire Safety and Ecology Holdings Corporation (SEC) from Homeland Security Capital Corporation (Homeland). Under the terms of the agreement, Perma-Fix will pay Homeland approximately $24.5 million consideration, consisting of $22.0 million in cash, subject to working capital adjustments, along with a 3-year unsecured $2.5 million promissory note, bearing an annual interest rate of 6%. Simultaneous with the closing, certain key management investors of SEC will purchase approximately $1.0 million of Perma-Fix' restricted common stock, with the purchase price for the stock to be deducted from the cash portion of the purchase price payable to Homeland. Perma-Fix expects the acquisition will be accretive to earnings, excluding any one-time acquisition-related expenses. The acquisition is subject to certain closing conditions, including financing, and is expected to be completed during the third quarter of 2011.
SEC, headquartered in Knoxville, Tennessee, specializes in the remediation of nuclear materials for the U.S. Department of Energy, U.S. Department of Defense, and other federal agencies. The company employs more than 450 employees and, based on Homeland's 2010 Form 10-K, generated approximately $86.0 million in revenue and $3.3 million in net income for the fiscal year ended June 30, 2010.
Dr. Louis F. Centofanti, Chairman and Chief Executive Officer, stated, "The acquisition of SEC dramatically expands our nuclear services capabilities. On a combined basis, we can now offer customers, both government and commercial, one of the broadest and most comprehensive end-to-end nuclear waste solutions in the industry. We believe that this expansion of our nuclear service capabilities, coupled with our existing nuclear waste treatment expertise, clearly places us at the forefront of the industry and should enhance our value to our customers and our shareholders. SEC brings a highly qualified management team who we feel will integrate well and complement our current management."
Christopher Leichtweis, Chief Executive Officer of SEC, stated, "We are excited to become a part of Perma-Fix Environmental Services, a true leader and innovator in the nuclear services industry. As we unite through this transaction, our technologies and capabilities provide a much broader platform from which to grow the business, offering complete solutions to our customers."