Comarco Enters Into Agreement to Sell Interest in SwissQual AG
January 23 2006 - 6:30AM
PR Newswire (US)
IRVINE, Calif., Jan. 23 /PRNewswire-FirstCall/ -- Comarco, Inc.
(NASDAQ:CMRO) today announced that it has agreed to sell its
minority interest in SwissQual AG ("SwissQual") to a wholly-owned
subsidiary of Spirent plc (LSE:SPT)(NYSE:SPM), a leading
communications technology company based in the United Kingdom.
Highlights -- A wholly-owned subsidiary of Spirent plc ("Spirent")
has agreed to acquire 100 percent of the outstanding shares of
SwissQual for consideration totaling up to approximately $70.5
million. This transaction is expected to close within the next
three business days. Consummation of this transaction is subject to
a number of closing conditions, including no material change in the
assets or liabilities of SwissQual since January 1, 2006 and the
satisfaction or waiver of other customary closing conditions. There
can be no assurance that the closing conditions will be satisfied
or that this transaction will be consummated. -- Approximately
$39.8 million in cash is expected to be paid at the close of the
transaction with an additional $9.0 million put into escrow to
secure certain indemnification obligations. The escrow is expected
to be released within 24 months. In addition, up to $21.8 million
in contingent consideration may be paid within 24 months upon
satisfaction of certain performance and other requirements. The
purchase agreement contains customary representations and
warranties for transactions of this type. The Shareholders of
SwissQual, including Comarco, have agreed to indemnify Spirent for
breaches of representations, warranties, and covenants. -- Upon
closing, Comarco expects to receive approximately $6.7 million of
the closing consideration, net of transaction costs, for its 18
percent ownership interest in SwissQual and may receive up to an
additional $5.5 million, or18 percent of any escrow distribution
and contingent consideration, within 24 months. Additionally,
subject to the transaction closing, SwissQual declared a one-time
dividend of which Comarco's share is approximately $0.5 million. --
Comarco purchased its 18 percent investment in SwissQual during
July 2001 for approximately $1.1 million in cash. -- SwissQual is
expected to continue as exclusive reseller of Comarco's Seven.Five
product platform for the European marketplace for a 12- month
period. -- Comarco intends to use the proceeds from the sale of the
SwissQual investment to support investment required to maintain and
further Comarco's worldwide leadership position in wireless quality
of service test systems. Additionally, the Company is evaluating
potential additional uses of cash proceeds that may be in excess of
the Company's foreseeable working capital requirements. "Through
our collaboration with SwissQual, Comarco's Seven.Five product
platform has dominated the European quality of service market for
wireless test systems and now has a significant installed base
throughout Europe, said Tom Franza, Comarco President and CEO.
"This installed base, comprised of the major wireless carriers
throughout Europe, has made a significant investment in our
Seven.Five platforms. Our long-term goal is to expand the
relationship with these customers as well as add new ones."
Forward-Looking Information This news release includes
"forward-looking statements" that are subject to risks,
uncertainties, and other factors that could cause actual results or
outcomes to differ materially from those contemplated by the
forward-looking statements. Forward-looking statements in this
release are generally identified by words such as "believes,"
"anticipates," "plans," "expects," "will," "would," and similar
expressions that are intended to identify forward-looking
statements. A number of important factors could cause our results
to differ materially from those indicated by these forward-looking
statements, including, among others, failure to receive the
contingent consideration from the sale of our investment in
SwissQual, as well as amounts held in escrow; the disruption in our
relationships with SwissQual or in SwissQual's operations; failure
to expand our sales and support capabilities in regions
historically serviced by SwissQual; activities by us and others
regarding protection of intellectual property; and competitors'
release of competitive products in our home markets and other
actions. Further information on potential factors that could affect
our financial results are included in risks detailed from time to
time in our Securities and Exchange Commission filings, including
without limitation our annual report of Form 10-K for the year
ended January 31, 2005. Although we believe that the expectations
reflected in the forward-looking statements are reasonable, we
cannot guarantee future results, levels of activity, performance,
or achievements. Moreover, neither any other person nor we assume
responsibility for the accuracy and completeness of the forward-
looking statements. We undertake no obligation to revise or update
publicly any forward-looking statements for any reason. About
Comarco Based in Irvine, Calif., Comarco is a leading provider of
wireless test solutions for field test applications, wireless
emergency call box systems, and ChargeSource universal mobile power
products for laptop computers, cellular telephones, and other
handheld devices. The Company's Web sites can be found at
http://www.comarco.com/ and http://www.chargesource.com/.
DATASOURCE: Comarco, Inc. CONTACT: Tom Franza, President and CEO,
+1-949-599-7440, or , or Dan Lutz, Vice President and CFO,
+1-949-599-7556, or , both of Comarco, Inc.; or investors, Douglas
Sherk, CEO, , or Jennifer Beugelmans, Senior Vice President, both
of EVC Group, Inc., +1-415-896-6820, for Comarco Web site:
http://www.chargesource.com/ Web site: http://www.comarco.com/
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