FTG Completes Acquisition of Substantially all of the Assets of Filtran Microcircuits Inc.
Toronto, Ontario – December 31, 2007 – Firan Technology Group Corporation (TSX: FTG) announced today that it has acquired substantially all of the assets from Filtran Microcircuits Inc. (“Filtran”), a Canadian printed circuit board manufacturer based in Ottawa, Ontario and focused primarily on the manufacture of microwave printed circuit boards for high frequency applications. Filtran had annual revenues of approximately $4,000,000 in 2007.
The transaction was effected pursuant to an asset purchase agreement entered into between FTG, Filtran and Filtran’s parent company, Merrimac Industries Inc. (“Merrimac”) (AMEX: MRM). The total consideration payable by FTG is $1.45 million plus the assumption of liabilities valued at approximately $360,000. FTG paid $800,000 of the purchase price at closing with the balance payable near the conclusion of an eight-week transitional period. FTG is financing the acquisition from existing cash and its bank operating line.
The purchase of Filtran’s assets has significant strategic benefit to FTG as it is expected that the acquisition will accelerate its penetration of very high frequency circuit board applications. This market segment’s use of high technology materials and special processing requirements limit competition and is a growing segment including many aerospace and defense applications. Under the terms of the acquisition, FTG has acquired advanced and unique processing equipment, process know-how, all of Filtran’s customer contracts as well as the working capital of Filtran. Also as part of the acquisition, FTG has entered into a separate agreement with Merrimac, to provide printed circuit boards for Merrimac’s internal needs including a specific military program.
“We are excited about this deal as it enables FTG to continue its strategy of consolidating printed circuit board manufacturers into a larger, more capable company that can compete on a world scale”, commented Brad Bourne, President and Chief Executive Officer of FTG. He added, “Canadian manufacturers, including FTG, have been hard hit by the continued year-over-year appreciation of the Canadian dollar and strong commodity prices. Building larger scale, particularly in specialized technologies, is a critical strategy in attempting to overcome these external factors.”
“For FTG, after a short transitional period, this transaction is expected to boost activity in both our Toronto and Chatsworth facilities and should generate positive contribution margin for both sites”, added Mr. Joe Ricci, Chief Financial Officer.
ABOUT FIRAN TECHNOLOGY GROUP CORPORATION
FTG is an aerospace and defense electronics product and subsystem supplier to the North American marketplace. FTG has two operating units.
FTG Circuits is a manufacturer of high technology/high reliability printed circuit boards. Our customers are leaders in the aviation, defense, and high technology industries. FTG Circuits has operations in Toronto, Ontario and Chatsworth, California.
FTG Aerospace manufactures illuminated cockpit panels, keyboards and sub-assemblies for original equipment manufacturers of avionics products as well as airframe manufacturers.
The Company's shares are traded on the Toronto Stock Exchange under the symbol FTG.
This news release contains certain forward-looking statements. These forward-looking statements are related to, but not limited to, FTG’s’s operations, anticipated financial performance, business prospects and strategies. Forward-looking information typically contains words such as “anticipate”, “believe”, “expect”, “plan” or similar words suggesting future outcomes. Such statements are based on the current expectations of management of the Company and inherently involve numerous risks and uncertainties, known and unknown, including economic factors and the Company’s industry, generally. The preceding list is not exhaustive of all possible factors. Such forward-looking statements are not guarantees of future performance and actual events and results could differ materially from those expressed or implied by forward-looking statements made by the Company. The reader is cautioned to consider these and other factors carefully when making decisions with respect to the Company and not place undue reliance on forward-looking statements. Other than as may be required by law, FTG disclaims any intention or obligation to update or revise any such forward-looking statements, whether as a result of new information, future events or otherwise.
For further information please contact:
Bradley C. Bourne,
President and CEO
Tel: (416) 299-4000 x 314
Firan Technology Group Corporation
Joseph R. Ricci,
Vice President and CFO
Tel:(416) 299-4000 x 309
Firan Technology Group Corporation