MONTREAL, Nov. 2, 2011 /CNW Telbec/ - Mitec Telecom Inc. ("Mitec") (TSX:
MTM) today announced that it has arranged to sell its Keragis military
division, located in Poway, California to Robert Rector and Maria
Rector (the "Rectors"), the founders of Keragis.
The transaction is valued at approximately $1 million and was comprised
of a combination of cash and cash equivalents, debt (secured on the
assets of Keragis and personally guaranteed by the Rectors), an ongoing
royalty and redemption of Mitec shares. Mitec's decision to divest
Keragis resulted from a significant evaluation of its technology,
status in its market as well as other factors involving its
"The analysis of Keragis led to the conclusion that its performance to
date has not achieved the milestones that Mitec demands in order to
ensure long-term sustainable profitability", said Jeffrey Mandel,
Mitec's President and Chief Executive Officer.
"Keragis offers very compelling technology that has succeeded in
catching the attention of several large military players, but Mitec
believes it still requires specialized hands-on support in addition to
substantial capital investment in order to achieve its full
commercialized potential", said Mandel. "The Rectors are better
positioned to be able to provide the hands-on support and capital
commitment that is required to realize on Keragis' opportunities."
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. Mitec is located in Montreal, Canada. Mitec is listed
on the Toronto Stock Exchange under the symbol MTM. On-line
information about Mitec is available at www.mitectelecom.com.
SOURCE MITEC TELECOM INC.
For further information:
| Source: || Mitec Telecom Inc. |
| Contact: |
| Mr. Jeffrey Mandel |
President, Chief Executive Officer and Chairman of the Board of Directors
Tel.: (514) 694-9000