Group West Systems to acquire Platon Consulting
Group West Systems Ltd
GPW
Shares issued 6,210,229
1999-06-17 close $1.31
Friday Jun 18 1999
Mr. Jag Sandhu reports
Group West Systems has signed a letter of intent to acquire 100 per cent of the
issued and outstanding shares of Platon Consulting Limited, a private company
based in Coquitlam, B.C., and established in 1978. Platon is a systems integrator
specializing in the private sector. Its impressive client list has been built up over the
years and includes such prominent businesses as Buchanan Lumber Sales Inc.,
Future Shop Ltd. and Shafer Haggart.
The maximum purchase price for the Platon shares is $3.1-million payable in cash
and shares of Group West. At the closing of the transaction, Group West will pay
the current shareholders of Platon $300,000 in cash or by way of promissory
note. The balance will be paid in up to 2,058,824 common shares of Group West
on an earn-out basis over three years, on the basis of one share for every $1.36 in
net income before tax of Platon Consulting Limited.
This acquisition is subject to normal due diligence, the execution of a formal
purchase agreement, and receipt of regulatory approval.
Stephen Loyd, president of Platon, stated: "Our companies have a lot of
similarities, yet we have seldom competed over the years. That alone
demonstrates that our resources and markets complement each other and that
there is a significant potential to leverage both companies with this merger."
Platon has revenues of approximately $2-million per year and over 15 employees.
With over 20 years in the market, it has grown a significant customer base that
remains loyal. It has assisted companies in implementing data warehousing
solutions, financial applications, and are currently engaged in outsourcing support
of legacy applications for Future Shop Ltd.
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