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Virtual Technology agrees to acquire Tech Squared
MINNEAPOLIS, Aug 2 (Reuters) - Hardware and software company Virtual Technology Corp. said Monday it signed a letter of intent to acquire the operating assets of hardware and software distributor Tech Squared Inc. for about $3.1 million in cash.
Once a definitive deal is reached, it would clear the way for Tech Squared's earlier agreement for software retailer and distributor Digital River Inc. to acquire most of Tech Squared's assets, as part of Tech Squared's liquidation plan.
The proposed Virtual Technology deal includes Tech Squared's distribution operations and various trade and Internet domain names.
Digital River said in July it would acquire most of the assets of Tech Squared, which owns about $93 million in Digital River stock. Before the deal could go through, Tech Squared had to sell its operations, including its catalog and distribution businesses.
Digital River said it would receive three million shares of its own common stock owned by Tech Squared and $1.2 million in cash. In exchange, it will issue 2.65 million shares of Digital River common stock to Tech Squared. At the time, Tech Squared said it would distribute the shares to its shareholders, after payment of debts, as part of a plan of liquidation.
"We believe that Tech Squared's catalog and distribution business is a natural fit with both our virtual-world.com online and GTI product distribution operations," Greg Appelhof, Virtual Technology's president and chief executive officer, said in a statement.
"We also believe that Tech Squared's revenues will add significantly to our customer base and bottom line," he said.
Shares of Virtual Technology were up 3/8 at 2-1/2. Tech Squared was unchanged at 3-25/32. |
