MONTREAL, May 9 /CNW Telbec/ - Mitec Telecom Inc. ("Mitec") (TSX: MTM), a leading designer and manufacturer of mobile wireless, fixed wireless, broadcast and satellite components is pleased to announce that it has entered into a definitive agreement with a Quebec-based provider of microwave components to sell certain assets relating to Mitec's legacy satcom business. Mitec anticipates that gross proceeds of $2.9 million in cash will be generated from this sale which is expected to close within a few days.
"This transaction, combined with the sale of Mitec's China-based RF conditioning business earlier this year, has generated gross proceeds of $7 million in cash to Mitec and further enhances Mitec's balance sheet, without shareholder dilution", said Jeffrey Mandel, Mitec's President and CEO.
"As we continue with our analysis of Mitec's various divisions with the objective of unlocking value, it became clear to us that we could monetize these product lines very efficiently and deliver significant value to shareholders.
"We now have substantial cash on hand, which, when combined with cost cutting initiatives at divisional as well as corporate levels, positions Mitec to capitalize on potential opportunities in the future", said Mandel.
About Mitec Telecom Inc.
Mitec is a leading designer and provider of radio frequency (RF) products for the telecommunications and satellite communications industries, as well as a variety of other sectors. Mitec sells its products worldwide to network providers for incorporation into high-performing wireless networks used in voice and data/internet communications. Headquartered in Montreal, Canada, Mitec also operates a facility in California. Mitec is listed on the Toronto Stock Exchange under the symbol MTM. On-line information about Mitec is available at www.mitectelecom.com.
Due to confidentiality provisions, Mitec is generally not able to disclose the names of its major customers or the financial data related to sales transactions. Certain statements in this release, including statements regarding future results and performance, are forward-looking statements based on current expectations. The accuracy of such statements is subject to a number of risks, uncertainties and assumptions that may cause actual results to differ materially from those projected, including, but not limited to, the effect of general economic conditions, decreases in demand for Mitec's products, fluctuations in selling prices and adverse changes in general market and industry conditions and other factors listed in Mitec's public filings with the appropriate securities regulatory authorities.
SOURCE MITEC TELECOM INC.
For further information: Mr. Jeffrey Mandel, President, Chief Executive Officer and Executive Chairman, email@example.com, Tel.: (514) 694-9000; Source: Mitec Telecom Inc.