TORONTO--(BUSINESS WIRE)--Wi2Wi Corporation ("Wi2Wi" or the "Company") (TSX-V:YTY)is pleased to announce that it has entered into an asset purchase agreement (the “Agreement”) with Precision Devices, Inc. (“Precision”) pursuant to which Wi2Wi has agreed to acquire certain assets and trade liabilities of Precision used in connection with the design, manufacture, distribution, and sale of Precision’s radio frequency products that include crystals, oscillators, filters and a whole range of frequency controllers (the “Purchased Assets”). Precision’s customers include Tier 1 customers in the avionics, military and telecommunications industry.
Pursuant to the Agreement, the Company will purchase the Purchased Assets at a price equal to (i) 4,461,353 common shares in the capital of the Company, or such higher number of common shares representing 5% of the outstanding shares on the Closing date of the transaction; and (ii) US $2.5 million payable in the form of a secured subordinated convertible debenture (the “Debenture”). The Debenture will mature twelve (12) months following the completion of the transaction and will bear interest at the rate of 10.25% per annum payable on the maturity date of the Debenture. Pursuant to the terms of the Debenture, Precision may convert all or any part of the principal amount outstanding under the Debenture into common shares in the capital of the Company (each, a “Share”) at a conversion price of $0.25 per Share and any accrued but unpaid interest thereon at the Market Price (as defined in the policies of the TSX Venture Exchange (“TSXV”)) at the time of conversion. Wi2Wi also granted the holder of the Debenture a security interest against the Purchased Assets.
“This is a great acquisition for Wi2Wi that has just recently monetized a product line for US $2.5 million and reported a turnaround in its operations and earnings. Precision had revenues of US $19 million in 2013. It is highly accretive, providing a boost to the revenues and a strategic fit for the new generation SiP (modules) and subsystems that Wi2Wi intends to develop. The addition of frequency controllers to our product mix greatly enhances Wi2Wi’s product offering in the M2M and IoT space as a wireless solutions provider, which is our specialty.”, said Zachariah Mathews, Wi2Wi’s Chief Operating Officer.
Prakash Hariharan, Interim CEO and Vice Chair of the Company, added “This is consistent with Wi2Wi’s strategy to make tactical accretive acquisitions to move in as a full-fledged service provider in the growing M2M space at the sub-systems level. In addition to avionics and telecommunications, as a wireless solutions provider, Wi2Wi will now be looking to make further inroads in the infrastructure domain that include, among others, smart grids and smart meters to leverage its technology and existing customer relationships with Precision. These are exciting times for the Company as a part of the turnaround process that started earlier this year.”
Wi2Wi Chairman, Dr. Hans Black added “This is a great fit for Wi2Wi and it enables the team to create shareholder value. We will be looking to expand and enhance our product profile on an ongoing basis in the M2M and IoT space.”
This transaction constitutes a Reviewable Transaction under TSXV Policy 5.3 – Acquisitions and Dispositions of Non-Cash Assets and as such, completion of the transaction is subject to TSXV approval.
Wi2Wi is a leader in industrial-class WiFi, WiFi-Bluetooth and GPS system-in-a-package (SiPs). Wi2Wi focuses on industrial (including Automotive), medical, infrastructure (including smart-home/smart building) and government markets worldwide. Wi2Wi’s products and value-added services provide highly integrated, multifunctional wireless sub-systems as complete wireless connectivity solutions for the Machine-to-Machine (M2M) and portable device applications globally. The Wi2Wi product range is designed for long life under a wide range of temperature variables.
Precision Devices, Inc. is part of Avrio Technology Group, LLC. Precision Devices, Inc. is a leading global developer and manufacturer of frequency control and filter products. With an established engineering heritage, Precision Devices, Inc. offers a comprehensive range of precision engineered crystals, LC filters, crystal filters, clock oscillators, voltage controlled crystal oscillators (VCXOs), temperature compensated crystal oscillators (TCXOs) and oven-controlled crystal oscillators (OCXOs). Precision supports customers in a wide range of industry sectors including avionics, space, defense, automotive, telecommunications and consumer products.
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Vice Chairman & Interim CEO
Forward-Looking Statements: This news release contains certain forward-looking statements, including management's assessment of future plans and operations, and the timing thereof, that involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control. Such risks and uncertainties include, without limitation, risks associated with delays resulting from or inability to obtain required regulatory approvals, ability to access sufficient capital, the impact of general economic conditions in Canada, the United States and overseas, industry conditions, stock market volatility. The Company's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits, including the amount of proceeds, that the Company will derive there from. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect the Company’s operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com).
Forward-looking statements are made based on management’s beliefs, estimates and opinions on the date the statements are made and the Company undertakes no obligation to update forward-looking statements and if these beliefs, estimates and opinions or other circumstances should change, except as required by applicable law. All subsequent forward-looking statements, whether written or oral, attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
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