Mirage Holdings, Inc. Signs a 'Letter of Intent' for Two Acquisitions
26 February 1999
Mirage Holdings, Inc. Signs a 'Letter of Intent' to Acquire the Remaining Positions in Network Solutions (Pvt.)Ltd. and Netsol UK, Ltd.
SANTA MONICA, Calif., Feb. 26 -- Mirage Holdings, Inc.
(OTC Bulletin Board: MGHI) ("Mirage") today announced that it has secured a
'Letter of Intent' to fully acquire Network Solutions (Pvt.)Ltd. and Netsol
UK, Ltd. Mirage presently owns a 51% equity interest in Network Solutions
(Pvt.) Ltd. a Pakistan based software development house. Mirage also owns a
43% equity interest in Netsol UK, Ltd. which is a related company of Network
Solutions (Pvt.)Ltd. This acquisition will give Mirage the remaining interest
of 49% of Network Solutions (Pvt.) Ltd. and 57% of Netsol UK, Ltd.
Mr. Najeeb Ghauri, President and CEO of Mirage commented that "Mirage has
successfully negotiated the letter of intent to acquire Network Solutions
(Pvt.) Ltd. and Netsol UK, Ltd. to continue Mirage's expansion plan in the
'Information technology' industry. This strategy is consistent with our
earlier announcement of focusing exclusively in the technology sector.
Subject to regulatory approvals and appropriate valuations, Mirage intends to
acquire the balance of Network Solutions (Pvt.) Ltd. and Netsol UK, Ltd. The
letter of intent currently proposes an issuance of 4.2 million shares of
Mirage in exchange for the remaining 49% stock of Network Solutions (Pvt.)
Ltd. and 57% stock of Netsol UK, Ltd. There is no cash component required to
consummate this acquisition." Mr. Ghauri continues, "At this time we have
retained a nationally recognized consulting firm to conduct a thorough "due
diligence" and a complete valuation of both of the companies. We expect to
complete the due diligence, get required approvals from the shareholders and
SEC by mid-March 1999 to complete this acquisition."
Upon a successful completion of the acquisition, an expanded management
team and board will be put in place. After the acquisition, the company will
be led by the existing Chief Executive Officer of Network Solutions (Pvt.)
Ltd. Mr. Salim Ghauri, who will be the President and Chief Executive Officer
of newly combined companies. Mr. Najeeb Ghauri will assume the role of Chief
Operating Officer and Chief Financial Officer at that time. The number of
board members would be enlarged to seven from current three members.
Network Solutions (Pvt.) Ltd. has been in business for over 3 years now,
head quartered in Lahore, Pakistan. Network Solutions (Pvt.) Ltd. is the
first Pakistani based software house to be certified as 'ISO 9001' which is
one of the most prestigious accreditation for software developers. The
company specializes in lease and finance software systems targeted for the
automotive captive leasing and finance industry. According to a recent
estimate by the Equipment Leasing Association (ELA), the size of this market
in North America alone is $180 billion annually. The customer's list of
Netsol has grown to include blue chip companies such as the Mercedes-Benz
Finance Companies in Australia, the United Kingdom, Singapore, Thailand,
Taiwan and Europe. Netsol also has other key customers outside of the leasing
industry such as ICI, Plc of the United Kingdom and Fuzzy! Informatik of
Germany. Network Solutions (Pvt.) Ltd. posted a revenue of about $500,000 in
the first half ended December 1998 as compared to about $94,000 same period of
1997. The operating profit was $53,825 as compared to a loss of ($128,424) in
the same period of 1997.
Netsol UK, Ltd. has been in business for over a year now and is located in
Milton Keynes, UK. This is the sales and marketing arm for Network Solutions
(Pvt.) Ltd. which has a team of over 20 IT professionals and consultants.
Netsol UK, Ltd. serves the customers based in Europe and provide dedicated
service to customers like Mercedes-Benz Finance Ltd, UK and ICI, Plc. The
Company posted revenues of over $2.1 Million in the first half of fiscal 1999
period, the period ending December 31, 1998. The operating profit for this
period was $221,201 or about 11% of sales.
Mr. Najeeb Ghauri, CEO of Mirage summarized the impact of this latest
development by saying, "the management team of Mirage is extremely excited
about the prospects for the acquisitions of these two entities, especially
because both of these entities are already profitable. We are very confident
that this latest development will enhance shareholder value and it is a giant
leap forward for Mirage."
Included in this material are "forward-looking statements" within the
meaning of Section 27 A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. Although the company
believes that the expectations reflected in such forward-looking statements
are reasonable, it can give no assurance that such expectations reflected in
such forward-looking statements will prove to have been correct. The letter
of intent is not binding and therefore there can be no assurance that the
acquisitions will be completed.