Edmonton-based K-Bro Linen Income Fund (TSX:KBL.UN) has reached an agreement to acquire a Burnaby-based linen business for $11.5 million with additional amounts paid for working capital.
The name of the business was not disclosed, however, K-Bro said the B.C. business provides linen services for health care facilities in Vancouver and hospitality customers in Greater Vancouver and Whistler.
It reported annual revenue of $14.4 million for the year ending June 30, 2009 and adjusted earnings before income taxes and depreciation of $1.7 million. K-Bro said the deal will be immediately accretive to the income fund.
The deal is expected to close in January and will be financed from the fund's existing line of credit.