Element entered into a definitive agreement to acquire 100% of TLSI Holdings Inc., the holding company of TLS Fleet Management, from Scotiabank and the company’s other minority shareholders for aggregate consideration of approximately $146.7 million plus debt. The transaction provides Element with more than $430 million of lease assets.

Element’s expansion into the fleet leasing industry represents a natural extension of its core business of providing equipment financing to businesses across Canada. Upon completion of the transaction, Element would become Canada’s largest independent Canadian leasing company, with total assets of approximately $1 billion. Element believes that the acquisition of TLS enhances the diversification of Element’s operations by providing a low-risk earnings stream that is complemented by significant fee based revenue, including cost management and fleet optimization services. The strength of TLS’ platform is evidenced by its strong track record of double-digit return-on-equity. Upon completion of the Transaction, TLS will continue to operate under the “TLS Fleet Management” brand name, within a new vertical of Element named “Element Fleet Leasing.”

“Our vision is for Element to become one of North America’s leading independent providers of lease financing,” stated Steven Hudson, chairman and chief executive officer of Element. “The acquisition of TLS will accelerate the growth of our business both through the strength of its platform and the extensive cross-selling opportunities with our other clients. Element’s extensive familiarity with the fleet management business, gained through the senior management team’s prior involvement with Newcourt Fleet Management, will enable us to capitalize on this rare opportunity,” Hudson added.

TLS’ core business is providing vehicle fleet leasing and management solutions and related service programs to Canadian companies, including service cards, remarketing, maintenance management and accident services. TLS, Canada’s fourth largest fleet leasing company, has operated across Canada since 1980 and currently manages over 750 fleets representing over 22,000 leased vehicles.

Scotiabank acquired majority control of TLS in 2009 after having previously held a minority ownership position.

The definitive agreement provides that Element will acquire all of the outstanding shares of TLSI Holdings Inc. The transaction is currently expected to close by June 29, 2012. The approximately $500 million funding required for the transaction will be satisfied through a combination of approximately $120 million in cash and drawing approximately $380 million against a new, $400 million facility secured against the TLS financial assets.

GMP Securities L.P. and BMO Capital Markets acted as financial advisors to Element in connection with the transaction and Blake, Cassels & Graydon acted as Element’s legal counsel.

Element also announced it intends to sell, on a private placement bought deal basis, an aggregate of 14.3 million Special Warrants at a price of $5.25 per Special Warrant for gross proceeds of approximately $75 million, to a syndicate of underwriters co-led by GMP Securities, Barclays Capital Canada and BMO Capital Markets acting as joint bookrunners. The syndicate also includes RBC Capital Markets, CIBC World Markets and Scotia Capital.

The proceeds of the offering will be used to fund Element’s future growth and for general corporate purposes and is scheduled to close on May 31, 2012.