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Eurocontrol Enters into LOI with SICPA for Sale of Subsidiary Global Fluids International S.A.
TORONTO, ONTARIO--(Marketwired - Aug. 18, 2015) -
NOT FOR RELEASE IN THE UNITED STATES OR TO U.S. NEWS WIRE SERVICES.
Eurocontrol Technics Group Inc.
(TSX VENTURE:EUO) ("Eurocontrol" or the "Company"), a Canadian public company specializing in the acquisition, development and commercialization of innovative energy security, authentication, verification and certification technologies, is pleased to announce that it has entered into a non-binding letter of intent (the "LOI") with SICPA Security Solutions SA, a private Swiss company that is a global provider of secured identification, traceability and authentication solutions and services, for the sale of Eurocontrol's 100% owned subsidiary, Global Fluids International S.A. ("GFI"). GFI's Petromark™, a unique and proprietary liquid authentication system is the world's leading solution for fully integrated oil marking, mixing and detection.
Amongst other terms, the LOI provides for a non-refundable deposit of $250,000 coincident with the signing of the LOI, an initial payment of $16 million to be received on the closing of the sale transaction, and a 5% royalty payment on all future GFI contracts, inclusive of both marker and logistics, for a period of six years with contracts signed during the fourth through sixth years being paid until the third anniversary of such contracts with a minimum guarantee of $1.5 million per year for six years.
It is intended that that parties will negotiate and enter into a definitive purchase and sale agreement within 30 days of the date of the LOI and that Eurocontrol will then call a special meeting of shareholders to approve the transaction. Closing of the transaction is subject to a number of conditions including for Eurocontrol, obtaining shareholder and TSX Venture Exchange approval of the transaction.
The Company has organized a conference call for interested parties to obtain more detailed information on the transaction and on SICPA and its plans at 9 am Toronto time. Participating in the call will be Gilles Léraillé, Executive Vice President, Business Development of SICPA, Bruce Rowlands, Chairman and CEO of Eurocontrol, Andres Tinajero, CFO of Eurocontrol and Paul Wood, Director and Chairman of the Special Committee of the Board of Eurocontrol. Interested parties are encouraged to call in advance of the 9 am commencement time utilizing the following dial-in numbers:
Conference access code: 7204577
North American toll-free dial-in number: 855 223 7309
International dial-in number: 647 788 4929
Bruce Rowlands, Chairman and CEO stated, "After a productive and successful due diligence process thus far, we are very pleased with the terms that we have been able to negotiate with SICPA on behalf of Eurocontrol shareholders. The GFI brand becoming part of the SICPA global group of companies will allow GFI to flourish and we believe will result in more contracts, more quickly due to SICPA's breadth of contacts and market penetration. It is a classic case of better together than apart - the combination of the logistics of operating these fuel marking projects with the underlying technology provider will provide a complete integrated Petromark™ offering. Our royalty will be calculated on the combined business as compared to our current revenue which is based solely on the provision of the technology. Eurocontrol also looks forward to supporting the new SICPA/GFI operations through our subsidiary Xenemetrix which will remain the supplier of the ED-XRF analyzers used in the Petromark™ solution."
"The basis of this transaction is the good synergy between SICPA and GFI which both offer comprehensive solutions in their respective fields for the authentication and monitoring of key tax carrying goods and items. Both companies work exclusively with governmental authorities in different countries where SICPA already has sizeable operations and therefore where the introduction of GFI will be facilitated. Equally, both organizations are used to providing top of the range, latest technology-based solutions, pledging at the same time to provide un-contaminated and robust data to state institutions", stated Gilles Léraillé, Executive Vice President, Business Development of SICPA who added, "Another unique characteristic of this transaction is the ''partnership" type of agreement that is envisaged for a noticeable period of time, instead of the typical "seller-buyer" relationship. In this way, the two parties' teams can be harnessed to maximize the chances of success and the realization of a promising upside for both Eurocontrol and the SICPA group."
SICPA is a private Swiss company founded in 1927 as Société Industrielle et Commerciale de Produits Alimentaires" (Industrial and Commercial Food Products Company), the acronym SICPA has been utilized as the company name as the breadth of its services expanded. Originally involved in the production and supply of a special fat used in the milking of cows, SICPA moved into the field of security inks for currency printing in the early 1940's. Since then, SICPA has become a global provider of secured identification, traceability and authentication solutions and services. Every day, governments, companies and millions of people rely on SICPA to protect the integrity and value of their currency, personal identity, products and brands. Today SICPA is an international organization with technologies and services in more than 200 countries around the world, and 3,000 staff of over 50 nationalities. SICPA is a trusted security provider and adviser to governments, central banks, high-security printers and industry through its three global businesses - security inks, government security solutions and product and brand protection solutions. Additional information on SICPA can be obtained by visiting the SICPA website www.sicpa.com.
About Eurocontrol Technics Group Inc.
Eurocontrol through its three wholly owned subsidiaries, Global Fluids International S.A. ("GFI"), Xenemetrix Ltd. ("Xenemetrix") and XwinSys Technology Development Ltd. ("XwinSys"), is a leading provider and innovator of detection and marking systems worldwide. GFI and Xenemetrix are global pioneers in developing and implementing innovative molecular marking systems for the oil industry and XwinSys is currently a development stage company. GFI's unique and proprietary liquid authentication system, Petromark™, is the world's leading solution for fully integrated oil marking, mixing and detection. Xenemetrix is a leading designer, manufacturer and marketer of energy-dispersive x-ray fluorescence ("ED-XRF") systems, a technology that is the most accurate and economic method for determining the chemical composition of many types of materials, including the analysis of petroleum oils and fuel. XwinSys is developing technology and intellectual property that will combine 2D and 3D image processing technology from Brossh Inspection Systems Ltd. of Israel with Xenemetrix's ED-XRF technology for application in the semi-conductor manufacturing process.
For further information on Eurocontrol, please visit the Company's website at www.eurocontrol.ca.
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