GEM seen to have multi-million dollar accretive revenue impact for
OTTAWA, July 2 /CNW Telbec/ - Thermal Energy International Inc.
(TSX-V:TMG) (www.thermalenergy.com) (the "Company" or "Thermal Energy")
announced today it has completed the acquisition of Gardner Energy Management
Ltd. ("GEM"), of Bristol, U.K. (the "Transaction").
As per the terms of the Transaction, announced on April 7, 2008, Thermal
Energy made a base payment of (pnds stlg)2.7 million ($5.38 million CAD) upon
closing July 1, 2008. Funds for this transaction were raised in the Company's
recently announced $15 million private placement involving a number of the
most recognized renewable energy and sustainability focused funds in Toronto,
New York and London.
An additional payment of up to (pnds stlg)1.3 million (approximately
$2.6 million CAD) may be made on an earn-out basis in a combination of cash
and shares over a three-year period subject to defined future growth targets
of the GEM(R) business unit.
"We are delighted to have been able to finalize this acquisition in such
an accelerated time frame in accordance with our plan," said Thermal Energy
President and CEO Tim Angus. "Thermal Energy's recent success in securing the
capital to finance the Transaction from institutional investors is further
validation of Thermal Energy's business strategy and recognition of the
excellent value GEM can deliver to the Company and its shareholders.
"I am pleased to welcome the GEM team to the Thermal Energy family.
Together we are well-positioned to capitalize on current and future market
opportunities and deliver even greater value to customers," said Mr. Angus.
The Company is pleased to confirm that Tim Gardner, founder and Managing
Director of GEM will remain with the company to assist Thermal Energy's
management team in overseeing a smooth and seamless integration into a single
organization serving customers with an expanded solution offering.
"I am pleased and confident in the future growth prospects of the GEM(R)
product line as a result of our joining the Thermal Energy team," said
Mr. Gardner. "I look forward to working together to advance the widespread
acceptance and adoption of GEM(R)".
The Transaction is seen by management to have a significant positive and
immediate impact on Thermal Energy's revenues. On a trailing 12-month basis,
GEM's revenues were in excess of $3.2 million. Historically GEM has
experienced compounded annual growth of 25%. The Company anticipates continued
strong growth prospects in the U.K. and plans to leverage the synergies of the
acquisition to further increase overall GEM(R) product line revenues in
FY 2009 and subsequent years. This includes anticipated growth from expanded
sales activity in China, North America and other European markets.
In May 2008, GEM signed a preferred supplier agreement with a
high-ranking Global 500 life sciences company, with operations in more than
110 countries. This global preferred supplier agreement is expected to result
in substantial growth for the GEM(R) business unit over the next five years
and provide excellent cross selling opportunities for TEI's other energy and
emission reduction solutions.
The Transaction provides a number of significant operational, strategic
and market synergies, detailed in the April 7, 2008 press release which may be
Meetings have been scheduled at GEM's headquarters in Bristol, U.K. in
mid-July to discuss sales growth and marketing strategies including the
introduction of Thermal Energy's heat recovery and other energy and greenhouse
gas reduction solutions to GEM's customer base which includes a number of
Global 500 corporations.
NOTE: This press release may contain forward-looking statements relating
to, and amongst other things, based on management's expectations, estimates
and projections. Such statements including those about the Company's strategy
for growth, product development, market position, expected expenditures and
financial results are forward looking statements. These statements are not
guarantees of future performance and involve a number of risks, uncertainties
and assumptions. Many factors could cause results to differ materially from
those stated. The Company disclaims any obligation to publicly update or
revise any such statements.
About Thermal Energy
Thermal Energy International Inc. is an innovative technology company
providing custom energy and emission reduction, and bioenergy solutions.
Headquartered in Ottawa, Canada, TEI is a designer, design build developer,
fabricator, owner, operator and supplier of proprietary and patented energy
conservation, renewable energy and environmental technology solutions. Thermal
Energy is a fully accredited professional engineering firm, and offers
advanced process and applications engineering services. The Company is a proud
member of the Chicago Climate Exchange (CCX). FLU-ACE(TM), DRY-REX(TM),
THERMALONOx(TM) and THERMALOZOMAx(TM), THERMAL AUD(TM) and GEM(R) are
trademarks of Thermal Energy International.
About Gardner Energy Management (GEM)
Gardner Energy Management Ltd. (GEM), (www.gemtrap.com) was established
in the U.K. in 1995 to manufacture and market the GEM Venturi Orifice Steam
Trap. The company won the UK Engineering Council's Environmental Award for
Engineers in 1998 and the Institution of Chemical Engineers' Best New Product
in 1999. To date, more than 50,000 GEM Steam Traps have been installed across
Europe as a "no-fail" permanent replacement for traditional steam traps. The
GEM traps have been demonstrated to provide significant reductions in the
overall cost of steam production with a commensurate reduction in greenhouse
gases and other emissions. More recently, GEM steam traps have been introduced
into North America and China with positive results and these markets represent
a significant untapped opportunity going forward. GEM was acquired by Thermal
Energy International Inc. in July, 2008.
For more information about Thermal Energy International Inc.
(TSX-V: TMG), visit our website at www.thermalenergy.com.
THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT
RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
For further information:
For further information: Tim Angus, President and CEO, (613) 723-6776;
Stuart McCarthy, Investor Relations and Communications, (613) 723-6776 x 220,
(613) 762-4321 - cell, firstname.lastname@example.org