Glendale to Sell Electronics Division to Circuit World
- Revenue of combined entity exceeds $50 million, creating Canada's largest aerospace and defence supplier of advanced technology printed circuits -
Toronto Stock Exchange Symbol: GIN
OAKVILLE, ON, June 5 -- Glendale International Corp. (TSX:GIN) announced today that it has entered into a merger agreement to sell its wholly- owned subsidiary, Firan Technology Group Inc., to Circuit World Corporation (TSX:CCW), a leading manufacturer of printed circuit boards (PCBs) based in Toronto, Canada.
Under the terms of the agreement, Circuit World will satisfy the purchase price by issuing to Glendale 8,541,987 Circuit World common shares. Circuit World common shares closed yesterday at $1.20 per share on the Toronto Stock Exchange. Following the successful closing of the transaction, Glendale will own approximately 49% of the outstanding shares of Circuit World and will nominate four directors of Circuit World's proposed seven member Board. The transaction requires the approval of Circuit World shareholders and the satisfaction of other conditions typical of a transaction of this nature. Shareholders of Circuit World will vote on the merger at the meeting of shareholders scheduled for June 30, 2003. If shareholders approve the merger, closing of the transaction is expected to occur on or about July 4, 2003. The Boards of Directors of both companies have unanimously voted in favor of the proposed merger.
"We view the sale of our electronics division as a long-term strategic investment in Circuit World providing shareholders of Glendale an opportunity to benefit from a stronger, more viable, pure-play technology business," said Mr. Edward Hanna, President, Chief Executive Officer and Chairman of Glendale. "Recent challenges in the PCB market require manufacturers to invest in new state-of-the-art equipment, process controls and systems, driving up the minimum viable size of competitors in this marketplace. Given the complementary nature of these two organizations, we believe we will be able to recognize cost savings across both businesses through better capacity utilization, reduced material and overhead costs, and increased leverage with suppliers."
Based on the most recent annual financial statements for the two companies, the combined entity has approximately $50 million in annualized revenue, creating Canada's largest aerospace and defence supplier of advanced technology printed circuits and ranking among the top 25 PCB manufacturers in North America. The integration period is expected to last approximately three months, following which it is anticipated that the combined entity will capitalize on strategic efficiencies generated from its newly created critical mass and cross-selling opportunities within its strong client base.
About Circuit World Corporation
Circuit World is a high-technology fabricator of high-density, multi- layered printed circuit boards. Approximately 80% of its sales are derived from the Avionics, Telecommunications, Medical and Advanced Test industries in the U.S., with the remainder in Canada.
About Firan Technology Group
Firan Technology Group manufactures various electronic products. Through its Precision Division, Firan Technology manufactures printed circuit boards primarily for large US corporations in the electronics industry. Through its Edgelit Division, the business manufactures aircraft illuminated instrument panels for commercial aircraft manufacturers in the civil and military aviation industries. In addition, Edgelit also manufactures electro- luminescent lamps for use in illuminated instrument panels and a variety of other products sold to various commercial and aviation companies.
About Glendale International
Glendale International Corp. is a diversified Canadian company that operates through autonomous subsidiaries in Canada and the U.K. The Corporation is the largest Canadian manufacturer of recreational vehicles (RVs) and sells its extensive product range through dealers in Canada and the U.S. Glendale's other subsidiaries and divisions include U.K. based Fernau Avionics and Oakville, Ontario based Quality Plastics.
Glendale International Corp. is publicly traded on the Toronto Stock Exchange ("TSX") under the symbol "GIN" and has approximately 12.5 million common shares outstanding.
To reach Glendale via the worldwide web logon to www.glendaleint.com.
This press release contains certain forward-looking statements that reflect the current views and/or expectations of management of Glendale with respect to its performance, business and future events. Such statements are subject to a number of risks, uncertainties and assumptions. Actual results and events may vary significantly.