MISSISSAUGA, Ontario, Dec. 4, 2007 (PRIME NEWSWIRE) -- D Mecatronics Inc. (Pink Sheets:DMTN) today announced that it has completed a definitive proxy statement regarding the written, preliminary proposal of Investment Group "LesKo," a Russian investment company, to purchase either substantially all of D Mecatronics assets or at least a majority of D Mecatronics common stock. The proxy materials can be viewed and downloaded now on D Mecatronics' website (www.dmecatronics.com). The proxy materials include detailed instructions on how to vote.
The proxy materials relate to a special meeting of the shareholders of D Mecatronics, to be held on December 14, 2007 at 10:00 a.m., local time, at D Mecatronics headquarters, 7669 Kimbel Street, Mississauga, Ontario Canada. D Mecatronics stockholders of record as of the close of business on November 14, 2007 will be entitled to vote at the special meeting, which will consider the preliminary purchase proposal submitted the Company.
On September 17, 2007, the Company's Vice President and Director received a written preliminary proposal from Investment Group "LesKo," a Russian investment company representing the interests of an undisclosed client (hereafter "LesKo") expressing interest in the Company's "potential interest in selling the assets which also include experience, all the patents, technologies and equipment" of the Company.
On September 21, 2007, LesKo sent the Company another letter stating "the estimation of the cost of the company's assets (120 million) which has been agreed by us during the discussion seems to be a good base for further negotiations." Subsequently LesKo gave the Company an unsigned preliminary proposed "Common Stock Purchase Agreement" dated November 5, 2007, which proposed a purchase and sale of the Company's common stock at a purchase price of forty nine cents (US$0.49) per share.
These preliminary proposals from LesKo discuss a possible, but not definite, future offer for either a purchase of substantially all of the Company's assets or a purchase of at least a majority of the Company's outstanding common stock. Either proposal would require, at some future date, an affirmative vote from our shareholders approving such action. The special meeting on December 14 will consider the question of whether a majority of the Company's shareholders have interest in further negotiations with LesKo. At the special meeting, shareholders will be asked to vote for or against the Company's pursuit of further negotiation of the preliminary proposal with LesKo.
"We emphasize that at this point the negotiations are preliminary, and neither party has given any assurances that an agreement can be reached or that material terms can be agreed upon. Many of the material facts remain undisclosed at this time, but we intend to complete a due diligence review as part of further negotiations. The purpose of a Special Shareholder Meeting at this preliminary stage is to hold a non-binding referendum on shareholder interest in the proposal, so as to give LesKo a preliminary indication about whether future shareholder consent for a firm offer has any possibility of being obtained," wrote Berardino Paolucci, President of the Company, in his cover letter to the definitive proxy materials dated December 3, 2007.
If or when a final definitive agreement with LesKo is reached, the Company will provide another proxy statement and hold another shareholder meeting in which further disclosure and voting will occur. The Company anticipates that this preliminary non-binding referendum will help encourage LesKo to continue further negotiations with the Company.
The Company's Board of Directors has unanimously approved further negotiation of the preliminary purchase proposal from LesKo and has determined that it should take the preliminary purchase proposal seriously and engage in further negotiations with and due diligence investigation of Investment Group "LesKo" to determine whether their proposal is suitable for the Company and the holders of the Company's common stock.
The Company's Board of Directors unanimously recommends that stockholders vote "FOR" the further negotiation of the preliminary purchase proposal. The proposal requires the approval of a majority of the D Mecatronics shares that are present or represented by proxy at the shareholder meeting.
Shareholders are encouraged to read the Company's definitive proxy materials in their entirety as they provide, among other things, a discussion of the process that led to the preliminary proposal.
D Mecatronics shareholders are reminded that their vote is very important regardless of the number of shares of common stock they own. Whether or not shareholders are able to attend the Special Meeting in person, they should complete, sign and date the proxy card and return it as soon as possible, and no later than 10:00 am on December 14, 2007.
Shareholders who have questions about the proposed buyout or need assistance in submitting their proxy or voting their shares should contact Dino Paolucci Jr. (Vice President and Director of public relations)
About D Mecatronics Inc.: (http://www.dmecatronics.com/)
D Mecatronics Inc. supplies components, integrated systems and robotic modules to the world's top ten automotive suppliers. Through independent subsidiaries the Company offers sector and technology specific solutions to enable our customers to dramatically accelerate time-to-market and revenue.
To date, the Company's primary activities include design, build and installation of tube-related automated systems used by automotive parts and assembly suppliers. The Company is currently offering products such as Seat Frame Systems, IP Tube systems and Integrated Bend-Weld Systems for the automotive industry.
The D Mecatronics Inc. logo is available at http://www.primenewswire.com/newsroom/prs/?pkgid=2180
Forward-looking statements in this release are made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties, including without limitation, continued acceptance of the Company's products, increased levels of competition for the Company, new products and technological changes, the Company's dependence on third-party suppliers, and other risks detailed from time to time in the Company's periodic reports filed with the Securities and Exchange Commission.