Exco Technologies Limited announces purchase of South American extrusion tool business
July 27 2011 - 4:20PM
PR Newswire (Canada)
TORONTO, July 27, 2011 /CNW/ -- TORONTO, July 27, 2011 /CNW/ - 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. To view this news
release in HTML formatting, please use the following URL:
http://www.newswire.ca/en/releases/archive/July2011/27/c7832.html
table border="0" tr td bSource: /b /td td /td td
/td td /td td Exco Technologies Limited (TSX-XTC) /td /tr tr
td bContact: /b /td td /td td /td td /td
td Paul Riganelli, Vice-President, Finance and Chief Financial
Officer /td /tr tr td bTelephone: /b /td td /td td
/td td /td td (905) 477-3065 Ext 7228 /td /tr tr td
bWebsite: /b /td td /td td /td td /td td
a href="http://www.excocorp.com"http://www.excocorp.com/a /td /tr
/table p /p
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