FT. LAUDERDALE, Fla., Dec. 17, 2004 (PRIMEZONE) -- Hairmax International, Inc. (OTCBB:HRMX) Management today announced the company will acquire Arcotect Digital Technology Ltd. in an exchange transaction in which Arcotect will become a wholly owned subsidiary. The complete acquisition and merger is expected to be completed within the month.
Arcotect Limited, headquartered and based in Hong Kong, China, is helping digitalize the country of China's communication network.
In the area of cable TV ("CATV"), Nanhai was selected as the first pilot test city to digitalize its CATV (a complete transformation) by combining both government and commercial funding sources to develop a digital television ("DTV") network. An agreement was reached between the local government of Nanhai District and Arcotect with Arcotect being the sole contractor of the project, to digitalize its existing 360,000 CATV subscriber base. Arcotect has agreed to provide one set-top box free for each of the existing CATV subscribers and to establish a data broadcasting platform. In return, Arcotect will receive a share of the basic CATV subscription fees, PayTV fees and other related fees to repay Arcotect's capital investment in set-top box and to provide revenue to Arcotect for a period of twenty years.
Arcotect's conversion project commenced in December of 2003. As of today, approximately 70,000 set-top boxes have been installed for the conversion of analog TV into digital signal. For the operation of this project in Nanhai, Arcotect has employed more than 100 staff in providing marketing, sales, technical and financial management. At present, subscriber management and call centre systems developed by Arcotect have been in use with well trained staff operation. As of today, Arcotect projects that net profits for the first year should be more than RMB10 million and there will be significant increase in the second year.
Arcotect's management team of senior personnel comes from Hong Kong with substantial experience on CATV content management, software and internet development, marketing and corporate finance management. Together with good China connections through local senior staff, Arcotect is expected to have great opportunity to obtain more related projects in the near future. Arcotect has a vision. With China in the process of both converting television services from analog to a digital service and reforming the state-owned CATV administration to establish market driven commercial operation, Arcotect plans to capture the opportunities arising from the growth of China's CATV and information industry. In this aspect, Arcotect has signed some memorandum of understanding with cities near Nanhai. For further business development, Arcotect intends to develop itself into a national-wide content management corporation over TV cable network in China
This press release may include statements that constitute "forward-looking" statements usually containing the words "plans," "expects," "believes," "projects," "intends" or similar expressions. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. The risks and uncertainties are detailed from time to time in reports filed by the company with the Securities and Exchange Commission including forms 8K, 10-SB, and 10-KSB. These risks and uncertainties include, but are not limited to the following: Company's limited working capital, competitive nature of consumer services, consumer spending habits, legal and economic uncertainties, and changes in consumer shopping trends and or availability of financing.