TORONTO, July 27, 2011 /PRNewswire/ - Exco Technologies
Limited (TSX-XTC) today announced that it has entered into an
asset purchase agreement for the acquisition of a customer's
extrusion tool making business situated in Colombia. The
acquisition secures for Exco an experienced workforce and an
agreement to supply the majority of the customer's extrusion
tooling requirements. In addition to the all cash purchase
price of approximately $750,000.00,
Exco will move, over the next several months, machinery and
equipment worth approximately $1
million from Exco's recently closed AluDie facility in
Canada to Columbia and Exco will
invest an additional amount of approximately $1 million for leasehold improvements and
additional machinery and equipment over the next year. The
operating results are expected to be accretive in the second year
of operation. The agreement is subject to usual conditions
and is expected to close in October of this year.
Exco currently exports approximately
$5 million worth of extrusion tooling
to a number of South American countries including Colombia.
Once Exco has concluded this acquisition and satisfied its supply
agreement obligations to the Customer it will transfer this
business to the Colombian facility over the next 2 to 3
years. This is expected to make available some capacity at
Exco's remaining Canadian extrusion die facility which can then be
used to meet North American demand as economic conditions
improve. It is expected that once this process is complete
the Colombian business will generate annual sales of approximately
$8 million to $10 million. This is
consistent with Exco's goal of pursuing market share in developing
regions and manufacturing in low cost jurisdictions.
Exco Technologies Limited is a global
supplier of innovative technologies servicing the die-cast,
extrusion and automotive industries. Through our 10 strategic
locations, we employ 1,994 people and service a diverse and broad
customer base.
This news release contains forward-looking
information and forward-looking statements within the meaning of
applicable securities laws. We use words such as "anticipate",
"plan", "may", "will", "should", "expect", "believe", "estimate"
and similar expressions to identify forward-looking information and
statements especially with respect to closing and completion dates,
investment amounts and Exco Colombia sales levels for future
years. Such forward-looking information and statements are
based on assumptions and analyses made by us in light of our
experience and our perception of historical trends, current
conditions and expected future developments, as well as other
factors we believe to be relevant and appropriate in the
circumstances. Readers are cautioned not to place undue reliance on
forward-looking information and statements, as there can be no
assurance that the assumptions, plans, intentions or expectations
upon which such statements are based will occur.
Forward-looking information and statements are subject to known and
unknown risks, uncertainties, assumptions and other factors which
may cause actual results, performance or achievements to be
materially different from any future results, performance or
achievements expressed, implied or anticipated by such information
and statements. These risks, uncertainties and
assumptions are described in the Company's Management's
Discussion and Analysis included in our 2010 Annual Report, in our
2010 Annual Information Form and, from time to time, in other
reports and filings made by the Company with securities regulatory
authorities.
While the Company believes that the
expectations expressed by such forward-looking information and
statements are reasonable, there can be no assurance that such
expectations and assumptions will prove to be correct. In
evaluating forward-looking information and statements, readers
should carefully consider the various factors which could cause
actual results or events to differ materially from those indicated
in the forward-looking information and statements. Readers are
cautioned that the foregoing list of important factors is not
exhaustive. Furthermore, the Company disclaims any
obligations to update publicly or otherwise revise any such factors
or any of the forward-looking information or statements contained
herein to reflect subsequent information, events or developments,
changes in risk factors or otherwise.
SOURCE Exco Technologies Limited