News from Veltex: Looks like the business is expanding.
>>Thursday June 10, 9:30 am Eastern Time
Company Press Release
SOURCE: Veltex Corporation
Veltex Corporation Plans Acquisition
LOS ANGELES, June 10 /PRNewswire/ -- Veltex Corporation (OTC Bulletin Board: VLVT - news) announced today that it is negotiating to acquire a well-established textile mill near its existing facility which, if the acquisition is completed, will nearly triple Veltex's 1998 revenues and improve its bottom line earnings as much as five-fold or more. Veltex had audited 1998 revenues of $3.4 million and pre tax earnings of $270,541. The target company, also located in Bangladesh but whose name was not disclosed, reported '98 revenues in excess of $5,000,000 and earnings of nearly $1,000,000.
Veltex proposes to acquire the company with a combination of cash and restricted stock. Currently Veltex has 5,470,330 shares of
common stock outstanding. The float is estimated at 1.9 million shares.
Adding to its bright 1999 prospects, the company recently announced that its first quarter profits this year were $189,882. That was
an increase of over 120% from last year's first quarter and puts the company on a pace to reach nearly $600,000 in profits for
calendar 1999 without giving consideration to the proposed acquisition.
Veltex Corporation president and chairman, Javeed A. Matin, indicated he was cautiously optimistic about completing the transaction. ''One never knows for certain that matters will turn out as expected, but we have been discussing this possibility for some time now. I hope to be able to soon report to our shareholders that we have a signed letter of intent. If we then successfully complete the negotiations, we will immediately increase our production capabilities by a multiple of three or more. Such increased capacity should have a profound effect on our revenues and our bottom line results as well.''
Matin also acknowledged that regardless of whether he completes the proposed acquisition, he still seeks to purchase additional
production equipment to further increase his existing plant's capacity. He also has his eye on at least one additional acquisition
candidate, this one located in the U.S. and not in Veltex's traditional textile business.
Veltex Corporation is a manufacturer and distributor of high-quality specialty textiles primarily for use by manufacturers of
furniture, automobile interiors, and ready-to-wear garments. Its manufacturing facilities, managed by a former U.S. textile industry
executive with more than 30 years experience, are strategically located in Comilla, Bangladesh employing 315 people. This location
permits quote-free importing to USA markets thereby affording significantly higher profit margin potential than its competitors in
India and Pakistan. Company sales and distribution centers are located in the prestigious California Mart in Los Angeles as well as
in Canada, Europe, Asia, and Bangladesh.
Company contact information: Veltex Corporation at 213-627-9194, fax 213-627-9312, E-mail: veltex@veltex.com. For additional
information or comments, please contact the company investor relations firm, Irvine Capital & Communications, during market
hours and normal West Coast business hours at 949-733-9218, fax 949-786-8208. E-mail: irvinecapcom@home.com. On the East
Coast, contact Barry Kaplan Associates at 732-747-0702, fax 732-747-1837.
SOURCE: Veltex Corporation
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