Sound familiar. This looks like the Questec/Atlantic Aerospace relationship. Remember, TTN owns 100%
of Atlantic and all of Atlantic's interest in Questec.
titan.com
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Titan Announces Expected Proceeds of $40 Million
from Intel Acquisition of Its Technology Spin-Off IPivot
San Diego (October 5, 1999) -- The Titan Corporation (NYSE:TTN) today announced that it expects to receive approximately $41 million in cash in the fourth quarter of fiscal year 1999 as a result of the $500 million acquisition by Intel Corporation of IPivot, a technology spin-off from Titan. The cash payment to Titan is for its ownership interest in IPivot of approximately 8% after the dilutive impact of IPivot stock options, warrants and other equity instruments.
Titan created technology spin-off IPivot (formerly Serv-Now Net Technologies) in 1996 to commercialize a concept developed in Titan's software business unit. A technology spin-off is a strategy employed by Titan to create shareholder value by using outside capital to commercialize technologies that are not central to the company's four core businesses. Titan is able to generate shareholder value without adversely impacting the predictability of future earnings by forming a new company capitalized with venture capital (as was the case with IPivot), or by selling the technology for a minority interest and/or royalty income stream.
The technology spin-off strategy is complementary to another current Titan strategy of an equity carve out (also called a spin-out) of a minority interest in each of Titan's four core businesses - information technology, e-business, wireless and food pasteurization/medical sterilization - through an initial public offering. A sale of a minority interest to the public would provide the company with additional capital needed to continue to grow these businesses.
The proceeds of the sale of IPivot to Intel will strengthen Titan's balance sheet and support the pursuit of strategic initiatives. The cash received from the sale combined with money available under Titan's current credit facilities brings total working capital available to the company for its strategic initiatives to over $100 million.
"The purchase of IPivot by Intel in less than three years validates Titan's technology spin-off strategy," said Gene W. Ray, Chairman, President, and CEO of the Titan Corporation. "The cash generated from the sale of IPivot will assist us in our defense roll up strategy and accelerate the growth of our wireless and e-business operations. IPivot is the first of our six previous technology spin-offs to generate significant shareholder value. While we do not expect that every technology spin-off will necessarily be as successful as IPivot, we will continue to leverage our technologies to create new opportunities in the commercial sector and unlock hidden value for Titan shareholders."
Headquartered in San Diego, California, The Titan Corporation develops and deploys communications and information technology solutions and services. In addition, Titan markets the leading technology for the electronic pasteurization of food products. Titan's strategy is to maximize internal growth of its government and commercial businesses while at the same time acquiring businesses that can be readily integrated into its existing core business units. The company has annualized sales of approximately $400 million with a total backlog in excess of $1 billion and has 3,100 employees.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: The statements contained in this release which are not historical facts, including our outlook on the future performance of our core businesses and our growth strategies, are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by forward-looking statements. These risks and uncertainties include the Company's entry into new commercial businesses, dependence on continued funding of U.S. Department of Defense programs, government contract procurement and termination risks, risks associated with acquiring other companies, including integration risks, and other risks described in the Company's SEC filings.
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Contact:
Rochelle Bold, Vice President Investor Relations
(858) 552-9400 / invest@titan.com |
