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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): May 3, 2000
HANOVER COMPRESSOR COMPANY
(Exact Name of Registrant as Specified in Charter)
Delaware 1-13071 76-0625124
(State or Other (Commission File Number) (IRS Employer
Jurisdiction of Incorporation) Identification No.)
Incorporation)
12001 North Houston Rosslyn 77086
Houston, Texas 77086 (Zip Code)
(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (281) 447-8787
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Item 5. Other Events.
See the following press release announcing the acquisition of Applied Process
Solutions, Inc. by Hanover Compressor Company.
HANOVER COMPRESSOR TO ACQUIRE APPLIED PROCESS SOLUTIONS, INC.
ADDITION STRENGTHENS COMPRESSION, GAS HANDLING OFFERING AND GEOGRAPHIC REACH
HOUSTON--(BUSINESS WIRE)--May 3, 2000--Hanover Compressor Company (NYSE: HC -
news), the leader in outsourced compression services for the natural gas
industry, today announced it has signed a definitive agreement to acquire
Applied Process Solutions, Inc. (APSI), one of the world's leading suppliers of
natural gas and oil processing equipment, in an all-stock transaction.
Under terms of the agreement, which has received the approval of the Boards of
Directors of both companies, Hanover will acquire APSI in a stock transaction
for approximately 1,150,000 shares of Hanover common stock. Michael J. McGhan,
President and Chief Executive Officer of Hanover Compressor, said this strategic
acquisition would provide a substantial benefit to shareholders by extending
Hanover's global market reach in outsourced services to the natural gas
industry.
Comprised of such well-established companies as T.H. Russell Co. of Tulsa,
Oklahoma, and Maloney Industries of Calgary, Alberta, Canada, APSI is a
worldwide leader in the design, fabrication and installation of a full range of
processing, treating and production equipment. APSI has sales, engineering and
manufacturing facilities in Tulsa, OK, Houston, TX, Calgary and Edmonton,
Alberta, Canada, Mexico City, Beijing, China and London and Birmingham, England,
positioning the company to significantly add to Hanover's geographic market
reach and existing outsourced turnkey gas treating and gas handling business.
APSI has almost 500 employees and production facilities in the U.S., Canada and
the U.K. APSI had 1999 revenues of $73.9 million and anticipates revenues of
approximately $95 million this year.
"Several years ago, a key South American customer asked Hanover to provide
outsourced gas treating services together with our core contract compression
service to meet their full gas handling needs," said McGhan. "From this small
start, Hanover has built a substantial outsourced gas treating business around
the world, operating skid-mounted mobile processing plants that are provided
with outsourced compression services in certain applications. APSI's know-how,
experience and worldwide presence greatly enhances Hanover in this growing part
of our business, adding world-class process design and manufacturing capability,
substantial international experience and customer relationships which will
enable our company to compete more effectively on large-scale, turnkey projects.
The acquisition of these leading companies is highly complementary to our core
compression rental and services business and enhances Hanover's ability to
provide a broader range of outsourcing solutions and provides us immediate
access to markets in Europe, Africa, the Middle East and the Asia-Pacific
region."
"Our customers increasingly seek an outsourced solution to their production,
separation and treatment needs which often require substantial compression,
making the fit with Hanover an
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especially good one for our customers and employees," said Brad Goebel,
President and CEO of Applied Process Solutions. "We are pleased to join the
Hanover family."
Maloney Industries Inc. is a worldwide leader in the engineering and manufacture
of skid-mounted process equipment for the oil processing industry. This includes
equipment such as separators, heaters, free water knock outs, and oil emulsion
treaters. Maloney also supplies skid-mounted dehydration units, skid-mounted oil
and gas production equipment, sulfur recovery plants and gas treating
facilities. It has expanded its international presence with the acquisition of
UK-based Burnett & Lewis Ltd., and Tubefabs Ltd. and Wells-Hall Manufacturing
Ltd. of Edmonton, Alberta, Canada.
T.H. Russell Co. is a leader in the engineering, manufacture, and installation
of skid-mounted gas processing equipment such as gas liquid recovery plants, gas
and liquid treating plants and fractionation plants. It also supplies a variety
of refinery equipment including crude distillation, isomerization, catalytic
reforming, vacuum distillation, and hydro treating units.
Hanover Compressor Company is the market leader in full service natural gas
compression and a leading provider of service, financing, fabrication and
equipment for contract natural gas handling applications. Hanover provides this
equipment on a rental, contract compression, maintenance and acquisition
leaseback basis to natural gas production, processing and transportation
companies that are increasingly seeking outsourcing solutions. Founded in 1990
and a public company since 1997, its customers include premier independent and
major producers and distributors throughout the Western Hemisphere.
This news release contains forward-looking statements intended to qualify for
the safe harbors from liability established by the Private Securities Litigation
Reform Act of 1995, including statements regarding the completion of the
transaction and the demand for Hanover's products and services. These
projections and statements are based on management's estimates and assumptions
with respect to future events and financial performance and are believed to be
reasonable, though are inherently uncertain and difficult to predict. Actual
results could differ materially from those projected as a result of certain
factors. A discussion of these factors is included in the Company's periodic
reports filed with the Securities and Exchange Commission including its Form
10-K for the fiscal year ended December 31, 1999.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HANOVER COMPRESSOR COMPANY
Date: May 5, 2000 By: /s/ Michael J. McGhan
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Name: Michael J. McGhan
Title: President and Chief Executive Officer
