FORT WAYNE, Indiana, Jan. 23 /CNW/ - WaterFurnace Renewable Energy, Inc.
[WFI:TSX] announces that it has acquired (the "Acquisition") the fixed
assets and technology of Hyper Engineering Pty located in New South
Wales, Australia pursuant to a purchase agreement dated January 21,
2011 between, among others, WaterFurnace, Hyper Engineering, Eco
Engineering Pty and John Thomas Reay, for an aggregate purchase price
of US$2,788,436. Hyper Engineering designs and builds devices that
limit the inrush current that electric motors draw upon start up. By
reducing inrush current the life of electric motors is extended, but
most importantly, local electric power quality is improved and annoying
light flicker is eliminated.
WaterFurnace plans to expand the global marketing and sales of this
device. WaterFurnace also plans to incorporate technology developed by
Hyper Engineering into the design of its core heat pump products. On a
larger scale, this technology has the potential to reduce stress on the
electric utility infrastructure and make those systems more efficient.
Management believes that the Acquisition will have a positive impact on
revenues and profitability in the medium and long-term.
Pursuant to the Acquisition, WaterFurnace will satisfy the purchase
price by issuing 81,467 common shares (the "WaterFurnace Shares") and
paying US$788,436 in cash. WaterFurnace has also entered into a
consulting agreement with Eco Engineering to provide WaterFurnace
technical sales and application support, as well as to assist with new
product development efforts. Eco Engineering is owned by John Reay, the
seller of Hyper Engineering. WaterFurnace has incorporated the assets
into two new wholly owned Australian subsidiaries. WaterFurnace plans
to continue Hyper Engineering's operations with the same employee base
and facility. WaterFurnace International Asia Pacific Pty was
incorporated to assist with WaterFurnace's international sales efforts.
The issuance of the WaterFurnace Shares is subject to the approval of
TSX. TSX has accepted notice of WaterFurnace's intention to issue the
shares in connection with the Acquisition, but will not give approval
of such issue until it receives confirmation of the details of the
final purchase agreement and a legal opinion.
The WaterFurnace Shares will be subject to a regulatory four and a half
month hold period commencing on their date of issue.
More Information: WaterFurnace designs, manufactures and distributes geothermal heat
pumps. The geothermal units use the renewable solar energy stored just
below the surface of the earth to dramatically reduce the energy
consumed by buildings for heating, cooling and hot water.
WaterFurnace Renewable Energy, Inc. is traded in both Canadian dollars
and U.S. dollars on the Toronto Stock Exchange under the symbol WFI for
Canadian dollars and WFI.U for U.S. dollars.
Forward-Looking Information Cautionary Notice
Certain statements in this release constitute forward-looking statements
within the meaning of applicable Canadian securities laws.
Forward-looking statements include statements as to growth
opportunities and the potential benefits associated with WaterFurnace's
acquisition of Hyper. Readers are cautioned not to place undue reliance
on such statements. Investors should not rely solely on this
information to make investment decisions. These statements are subject
to certain assumptions, risks and uncertainties, including the
following: uncertainty regarding the future sales performance and
revenue associated with assets and technology acquired; WaterFurnace's
ability to successfully market the acquired technology; the risk that
expected synergies resulting from the Acquisition will not materialize;
and the risk of incurring unexpected costs integrating the assets and
technology acquired from Hyper. In addition, WaterFurnace's sales are
related to the cost and stability of electricity, fuel oil, propane and
natural gas. Federal, state and provincial building codes and energy
incentives can also impact sales. WaterFurnace is subject to standard
risks associated with most companies, such as normal competitive
pressures. These and other risks could cause WaterFurnace's actual
results, performance, achievements and developments to differ
materially from the results, performance, achievements or developments
expressed or implied by such forward-looking statements. Other risk
factors can be found in WaterFurnace's Annual Information Form dated
March 11, 2010 and other public documents filed by WaterFurnace with
Canadian securities regulatory authorities. WaterFurnace assumes no
obligation to update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise, except as
expressly required by law.
SOURCE WaterFurnace Renewable Energy, Inc.
For further information:
Additional information about the Company and its products is available on the Company's website: www.waterfurnace.com. Or call (260) 478-5667 and ask for investor relations.