LAVAL, QC, Jan. 22, 2013 /CNW Telbec/ - Today Ergoresearch Ltd (TSXV: ERG), Quebec's leading manufacturer of "intelligent" foot and specialty orthotics known primarily for its Clinique du pied Équilibre and Orthoconcept banners, is announcing the acquisition of all issued and outstanding shares of Laboratoire M.P. Langelier, LL Customs Inc., 2947-9052 Québec Inc. and Laboratoire M.P. Langelier/Lanoue Inc., hereafter referred to as "Langelier Orthèses Chaussures", a firm with headquarters in Beloeil (Québec).
Founded in 1967 by Mrs Marie-Paule Langelier and run by her son Michel since 2008, Langelier Orthèses Chaussures ranks among the leaders in its field in Quebec. The firm offers specialized services for custom foot orthotics, as well as custom and "comfort" shoes through its network comprised of six laboratories, one franchised laboratory and 40 service centres across the province.
For Michel Langelier, President of Langelier Orthèses Chaussures, the transaction ensures a healthy future for the family business. "It's an important page that's being turned in Langelier's history. We are pleased it will continue to evolve in a growth environment, offering our network a promising future and allowing our personnel to diversify its areas of expertise with new practices and technologies."
The president and CEO of Ergoresearch, Mr Sylvain Boucher, said he was pleased with the outcome of this transaction. "Langelier ranks second in the Quebec foot orthotics industry. This strategic acquisition will permit us to consolidate the Ergoresearch offer, gain a presence on a number of geographic markets until now unexplored, broaden our distribution network and reinforce our position as Quebec's leader. It will also constitute a showcase for our proprietary technologies and products, namely for our new OdrA orthotic device, a revolutionary knee osteoarthritis treatment".
Ergoresearch is self-financing this transaction. Since it intends to eventually refinance the acquisition through a bank loan, management is currently evaluating different financing models.
Shares of Langelier Orthèses Chaussures were acquired at a distance, in an arm's length transaction through its subsidiary, Ergorecherche Inc., 100% of which is owned by Ergoresearch Ltd. The purchase price amounted to $4.6M and is paid out as follows:
- $3,188,762 in cash, on closing;
- $811,238 by the assumption of the existing long-term debt of Langelier Orthèses Chaussures;
- $600,000 in the form of a promissory note to the sellers, to be paid out over three years at an annual interest rate of 3.75%.
The purchase price is subject to adjustment according to the total working capital available on January 1 2013, the date on which the transaction took effect. It is said to amount to $730,000 as will be reported in the consolidated audited financial statement of Langelier Ortheses Chaussures.
No finder's fee was incurred to conclude the transaction.
According to Langelier Orthèses Chaussures' unaudited financial statements for the year ended December 31 2011, the firm recorded $6,241,852 in revenues. Revenues for the eleven-month interim period ended November 30 2012 total $5,928,736, a 3.6% increase compared to the previous year.
Consolidated net profit for the eleven-month period ended November 30 2012 was $14,802 compared to $223,291 for the twelve-month period ended December 31 2011. Ergoresearch Ltd will not, in the future, be required to assume certain non-recurring expenses paid out during the fiscal year ended 2012. These non-recurring expenses amount to $310,000.
Total consolidated assets for the eleven-month period ended November 30 2012 were $3,299,285 compared to $2,982,088 for the twelve-month period ended December 31 2011.
Total consolidated liability for the eleven-month period ended November 30 2012 rose to $1,593,970 compared to $1,291,573 for the twelve-month period ended December 31 2011.
Shareholders' equity for the eleven-month period ended November 30 2012 was $1,705,315 compared to $1,690,515 for the twelve-month period ended December 31 2011.
This transaction is conditional to approval by the TSX Venture Exchange.
Ergoresearch has developed Quebec's leading network of orthotics clinics, with over 60 corporate and satellite centres under the Clinique du pied Équilibre and Orthoconcept banners. The leading manufacturer of "intelligent" foot orthotics and specialty orthotics, it is a trend-setter in creating durable medical equipment and software for the orthopedics market. Ergoresearch has developed and commercialized Expert-Fit™, the first robotized custom-fit orthotics manufacturing software program, launched the first Living Lab in Canada and more recently, a new generation of world-patented orthotic device called the OdrA, that revolutionizes the treatment of pain associated with knee osteoarthritis. Ergoresearch Ltd is listed on the Toronto Stock Exchange (TSXV) under the symbol ERG.
About Langelier Orthèses Chaussures
Langelier Orthèses Chaussures is a family business whose mission is to improve the physical condition of its patients through its expertise and technology. Ranked among Québec's leading foot orthotics providers, it offers a full range of products and services while focusing on its specialty, foot wellness. The know-how and skills of Langelier Orthèses Chaussures' 80 or so employees − 20 of whom are certified orthotists devoted to the health of their patients - are available through its network comprised of six laboratories, one franchised laboratory and 40 service centres across the province.
Certain statements in this Press Release contain forward-looking statements and information that may entail certain risks related to uncertainties. Such statements are based on management's expectations and no assurance can be given that potential future results or circumstances described in the forward looking statements will be achieved or will occur. Such risks factors include, but are not limited to, those related to the Corporation's ability to finance its activities, competition, ability to negotiate and maintain partnerships, the market acceptance of the said product, fluctuations in operating results, the impact of general economics, industry and market conditions, the ability to recruit and retain qualified employees, the success of research and development programs, fluctuations in cash flow, expectations regarding market demand for particular products, the strength of intellectual property, market dependence on new product development, the trust invested in sub-contractors or their core personnel, as well as other documents containing risks and uncertainties which are put forth every now and then by the firm to various Canadian securities and exchange commissions and made available at www.sedar.com.
The reader should not give great importance to forward-looking statements as (i) the results may differ from conclusions, predictions or projections contained in such forward-looking statements; and (ii) certain important factors or hypothesis taken into account in reaching conclusions or the preparation of a projection or prediction may prove to be incorrect in fact.
Management disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or circumstances.
All figures are in Canadian dollars, unless otherwise specified.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE: Ergoresearch Ltd
For further information:
Sylvain Boucher, President and CEO − Ergoresearch Ltd
Tel.: 450-973-6700, ext. 213 / [email protected]
Isabelle Vallée, Director − Communications and Public Relations, Ergoresearch Ltd
Tel.: 450-973-6700, ext. 233 / Cell: 514-377-0485 / [email protected]
Michel Langelier, President − Langelier Orthèses Chaussures
Tel.: 450-467-0762 / [email protected]