RICHMOND, British Columbia, April 12, 2007 (PRIME NEWSWIRE) -- CON-SPACE Communications Ltd. (TSX-V:CCB) (http://www.con-space.com), a world leader in specialized voice communication products, today announced that it completed the acquisition of Search Systems, Inc. ("Search Systems") of Bakersfield, CA, a leading manufacturer and supplier of enhanced search and inspection systems using video, sound and vibration technology.
CON-SPACE expects the combination of the two companies to increase both sales and earnings to the benefit of its shareholders. The combined annual sales are expected to exceed $17M with annual earnings in excess of $2.5M.
Search Systems was acquired for a purchase price of US$9.9 million plus certain post-closing adjustments. The acquisition included vendor take-back financing to the former owners of US$1.5 million payable with interest at 6% per annum over 7 years, which is secured by a charge on the assets of Search Systems, subject to bank debt and acquisition financing debt to Turret.
Financing for the acquisition included a $6,000,000 five year loan from Turret Oy AB ("Turret") of Finland. As part consideration for the loan, Turret received warrants for 300,000 shares exercisable for five years at a price of $1.00 during the first three years, $1.10 during the fourth year, and $1.22 during the fifth year. CON-SPACE also completed a private placement of 4,000,000 Units at $1.00 each, including 1,500,000 Units to Turret and 2,500,000 Units to Aearo Company I of Indianapolis, Indiana, for gross proceeds of $4,000,000. Each Unit includes one share and one-quarter warrant with each whole warrant exercisable over five years at a price of $1.00 during the first three years, $1.10 during the fourth year, and $1.22 during the fifth year.
CON-SPACE is also very pleased to announce that Mr. Rahul Kapur of Indianapolis, Indiana has joined its Board of Directors. Mr. Kapur is the Senior Vice-President of Aearo Company, an international designer and manufacturer of innovative safety products and communication systems.
About SEARCH SYSTEMS
Search Systems is a world leader in the design and manufacture of technical search, surveillance and inspection systems. Its video/audio systems, including the Searchcam 2000, Searchcam Patrol System, Under Vehicle Inspection System, the Searchcam EntryLink plus the DELSAR Life Detector are used around the world by search and rescue teams, law enforcement, the military, customs inspection tactical teams and industrial inspection personnel.
About CON-SPACE
CON-SPACE is recognized worldwide as the leading designer and manufacturer of specialized voice communication equipment used by police, fire, rescue, government agencies, militaries, municipalities and general industry. CON-SPACE has distribution throughout North America, Great Britain, Australia, parts of Asia, South America, and Europe. CON-SPACE also supplies many other manufacturers with private labeled products.
This press release is available on CON-SPACE's official on-line investor relations site for investor commentary, feedback and questions. Investors are asked to visit http://www.agoracom.com and view the CON-SPACE Investor Contact & Information Centre. Alternatively, investors are asked to e-mail all questions and correspondence to CCB@Agoracom.com
"Forward-looking" statements in this release involve risks and uncertainties associated with, among others, economic, industry conditions, technological development, and competition and should not be relied upon as actual results may differ materially from those projected.
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