Alternative Fuel Systems Inc. Acquires Gas Regulator Business
28 October 1998
Alternative Fuel Systems Inc. Acquires Gas Regulator Business
CALGARY, Alberta--(AutomotiveWire)--Oct. 28, 1998--Alternative Fuel Systems Inc. (AFS) has concluded the acquisition of the gas regulator division (2- and 3-stage) of Sherex Industries Ltd., a privately-owned Canadian company recognized as a world leader in natural gas vehicle (NGV) refueling technologies.
Sherex has headquarters in Burlington, Ontario, with divisions in Quebec and New York.
The Sherex patented regulators are integral components of the AFS Sparrow and Eagle fuel management systems for converting gasoline and diesel engines to natural gas (NG) operation. This acquisition significantly improves the AFS competitive position, providing a distinct pricing advantage for large volume orders while increasing profit margins.
AFS assumes Sherex Industries' regulator customer base, which includes Mercedes, BMW, Volvo, John Deere, and Freightliner Corp. The Sherex regulator division also supplies regulators to Clean Air Partners (CAP), an AFS associate company. CAP is the developer of technologies for Caterpillar diesel dual fuel engines.
AFS will increase direct and distributor sales, and expand marketing to competing kit suppliers, engine builders, and to the large original equipment manufacturer (OEM) market. All regulator orders and service requests will be directed to AFS at the Burlington location. Service, quality control, and support to customers will continue to be a priority. Manufacturing and engineering will remain in Burlington with the support of the AFS engineering division.
The regulator division is expected to initially generate an additional US$3.5 million in sales for AFS in 1999.
In Europe, AFS projects 1999 sales of 1,600 regulator units with major purchasers being Volvo, BMW, MAN, NEOPLAN, and Mercedes Benz Upfitter LPG Techniek. Regulators are being tested by Volkswagen, OPEL, IVECO, DAF, Thomas, Renault and Scania. In Japan, orders have been confirmed from Suzuki, orders are pending with Toyota, and discussions are underway with Mitsubishi. In South America, automobile converter ETNA has recently purchased 100 3-stage regulators and is in discussion to purchase an additional 900 units.
AFS expects the demand for its fuel management systems to increase significantly as projects and contracts currently under negotiations throughout the world are completed.
Sherex Industries (www.sherex.com) and sister company, Sherex/OPW Inc., have invested extensively in product development and marketing. Their regulators are well known in the industry and distributed worldwide. (OPW is a Dover Corp. company, www.dovercorporation.com)
Sherex has maintained the superior design and manufacture of their products to exacting engineering specifications for state-of-the-art performance and safety. The compact and lightweight regulators have resolved the issues of fuel flow management while enhancing engine performance and fuel economy. A unique feature of the technology allows temperature stability in extreme climate conditions. The 2-stage pressure regulator is used with fuel injection systems or to replace other high-pressure regulators. The 3-stage regulator is used with carburetion systems or atmospheric-like injection systems.
AFS is a total service organization that designs, manufactures, markets and installs engine fuel management systems for converting gasoline and diesel engines to compressed natural gas (CNG). AFS is on the cutting edge of advanced technology hardware and software with their SPARROW (natural gas conversion for gasoline engines) system, patented EAGLE (Diesel dual fuel system), and revolutionary Reversing Flow Catalytic Converter (RFC).
AFS is listed on the Vancouver Stock Exchange, trading symbol ATF.V.
The Vancouver Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.