Don Sutherland has rejected a lot of suitors over the years, but he thinks his exacting standards have paid off.
Stuart Olson Inc. (TSX:SOX) announced on Wednesday that it’s buying Studon Electric & Controls Inc. — the Red Deer company that Sutherland helped found and remains the president of — for $76.2 million. The deal is expected to close by Jan. 25, subject to Competition Bureau and TSX approval.
Sutherland said Thursday that he’s tickled with the sale, which has been in the works for a couple years. It’s in the best interests of Studon’s approximately 20 shareholders, as well as the company’s employees, clients and suppliers, he said.
“I was able to satisfy both groups of people.”
Sutherland said that Studon, which provides construction, maintenance and turnaround services to the oil and gas, pipeline and petrochemical industries, will benefit greatly from its link to Stuart Olson, a Calgary-based company that’s active in building construction, commercial and industrial electrical contracting, and industrial insulation services.
“This will really open the doors for us in areas where we couldn’t get through before,” he said.
“We’ve already got some stuff now that’s starting to roll in, just because of the announcement.”
But what really separated Stuart Olson from the other would-be buyers who have knocked on Sutherland’s door is its philosophy with respect to staff, clients and suppliers.
“They have almost an identical culture to ours, and that was the biggest selling feature to me.”
During a teleconference on Thursday, Stuart Olson president and CEO David LeMay also commented on how well the two companies fit together.
“Culturally, our companies are very similar,” he said. “We also have complementary service lines and end markets. Our target geographies overlap, which will make it easier to work together, but our client rosters do not.
“There is lots of room for cross-selling and bundling of services.”
LeMay also praised Studon’s management team. In fact, little is expected to change from Studon’s current operations, he said.
“They’ll continue to operate under the Studon name; they’ll be an affiliated brand with Stuart Olson.”
Sutherland confirmed that he’ll still head up Studon’s operations as president.
“They gave me the autonomy to run the company.”
He plans to take that entrepreneurial ball and run with it.
“I want these guys to realize they bought the best-in-industry, electrical instrumentation contractor. I’m going to prove that.”
Sutherland anticipates growth at Studon, which currently employs about 700 people but has topped 1,000 during busy periods.
“The opportunities that I know of that (Stuart Olson) can bring to the table: we’re going to need more project managers, we’re going to need more administrators, we’re going to need more safety people.”
Incorporated in 1995, Studon was started by Sutherland and his longtime friend Marty Hilsenteger.
Boosted by a turnaround contract for Nova Chemicals Inc. the following year, the company began a period of rapid growth — including through acquisitions.
In recent years, Studon has been named a Red Deer and District Chamber of Commerce Business of the Year and one of Canada’s 50 Best Managed Companies, and Sutherland was a finalist for an Ernst & Young Prairies Entrepreneur of the Year Award.
Earlier this month, a portion of Red Deer College’s downtown Donald School of Business was named Studon and Electric Control Learning Common in recognition of the more than $500,000 that Sutherland — an RDC alumnus — has donated to the college.