TORONTO, Aug. 8, 2005 (PRIMEZONE) -- Sparrowtech Multimedia Corporation (Pink Sheets:SPMC) ("Sparrowtech") is pleased to announce that it has acquired 100 percent of Yuan Chien Computer Company Limited ("Yuan Chien") effective August 5, 2005.
"The acquisition of Yuan Chien is a significant step for Sparrowtech as it opens business relations and opportunities in Asia," stated Cornelia Volino, President. "In addition, this acquisition will significantly increase shareholder value and demonstrate the commitment Management has towards establishing Sparrowtech's solid foundation within the technology and media sectors."
Under the terms of the Stock Exchange Agreement, Yuan Chien becomes a wholly owned subsidiary of Sparrowtech as Sparrowtech acquired all of the issued and outstanding capital stock and registered capital of Yuan Chien from its shareholders in exchange for 10,000 shares of the common stock of Sparrowtech. For a period of up to six months (extendable to one year if agreed by both parties), the former shareholders of Yuan Chien have the option to reacquire 75 percent of Yuan Chien capital stock by tendering their 10,000 shares of Sparrowtech common stock to Sparrowtech. Should this option be exercised, the remaining 25 percent of Yuan Chien capital stock will be distributed as a pro-rata dividend to the Sparrowtech shareholders within 30 days.
About Yuan Chien (www.yuan-chien.com)
Yuan Chien, based in Hong Kong, was established on November 1, 1999. Yuan Chien is in the production business of computer hardware, which includes computer main boards, LAN cards and VGA cards. Yuan Chien also provides tailor-made design services of educational software and online computer games. China, Taiwan, Hong Kong and Singapore are the key target markets for these product lines. Mr. Chen Hui Tung, one of the Directors of Yuan Chien, is well known in the industry for his designs and productions of educational software as well as for intellectual online computer games.
Sparrowtech is also pleased to announce that Chan Kin Keung, a Director of Yuan Chien, has been appointed to the Board of Directors of Sparrowtech. Mr. Chan has over 20 years experience in the sales and marketing of computer products in Hong Kong and throughout China. He maintains a good working relationship with computer distributors such as Acer, Bytepro, and Topcon. Mr. Chan is responsible for the commercial activities of Yuan Chien including the marketing of all product applications.
About Sparrowtech (www.sparrowtech.net)
Sparrowtech is positioning itself to launch the foremost and innovative brand networking application specifically designed for food service, hospitality and tourism professionals and domestic culinarians. Yuan Chien is the first major acquisition for Sparrowtech. In addition to the benefits derived from synergies between the two companies, Yuan Chien adds substantial value to Sparrowtech, as Yuan Chien will act as a stepping-stone for Sparrowtech to develop its Internet B2B and B2C businesses in Asia, particularly in China. Sparrowtech will continue to seek additional opportunities and acquisitions domestically and internationally for the benefit of Sparrowtech and its shareholders.
Sparrowtech further announces that Michelle Twiss no longer holds the position of Secretary nor is a member of the Board of Directors. Helen Chester, current Vice President and Director was appointed Secretary of Sparrowtech effective August 5, 2005.
A number of statements contained in this press release are forward-looking statements that are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve a number of risks and uncertainties including but not limited to: competitive market conditions, successful integration of acquisitions, and the ability to secure additional sources of financing. The actual results that Sparrowtech may achieve could differ materially from any forward- looking statements due to such risks and uncertainties.