RAYTEC TO FOCUS ON STRATEGIC GROWTH PLAN IN 2000
News Release
www.raytecnet.com
January 25, 2000
RCC/CDNX
Raytec Capital Corp. is pleased to announce that in 2000 the Company will focus on an acquisition plan involving a roll-up within the food safety industry (perishable food and agricultural product management). The Company has identified a number of acquisition candidates and is currently in discussions with several of the target companies.
The food safety and perishable control industry is extremely fragmented, characterized by a few small, local and regional businesses specializing in various product and service niches with annual revenues of under $10 million. The total market size is estimated at several hundred million dollars and growing.
Increased media attention and escalating government regulation of food safety is creating a significant opportunity for a national provider of products to enhance food safety. Food borne illness of microbial origin is the most serious food safety problem in the U.S. Over the past several years Raytec has built a diverse organization focused on food safety, quality assurance and shrink reduction, leading to the development of a comprehensive program of perishable control products and services designed to improve grocers' profits while ensuring food safety throughout the perishable food distribution chain. The Company's understanding of food processing, distribution and retailing, coupled with its antimicrobial technology (dry media chlorine dioxide) and value-added products, like ShrinkGUARD, positions the Company to take maximum advantage of this opportunity.
Reports published by USDA's Economic Research Service indicates that retailers, foodservices and consumers lost more than 96 billion pounds of edible food in 1995. Considering fresh fruits and vegetables, meat, fish and poultry only, at current average retail prices, total losses translate to $16.8 billion per year.
It is estimated that, at the retail level, $5.8 billion of food product is lost each year to spoilage and damage, of which produce constitutes approximately 36% or $2.1 billion per year.
The key to managing perishable products and providing for safer foods is through temperature monitoring, moisture maintenance and humidification, bacteria control and the control of ethylene gas. The ability to offer a total solution is key. Raytec will concentrate on acquiring only profitable companies that fit into its strategic growth plan of becoming a leading national provider of food safety solutions. Raytec will build around its platform company, Fractal/Astech (moisture maintenance and humidification) and the antimicrobial division (bacteria control).
Raytec has targeted companies providing products and services in the following four market segments: (i) Production (meat, poultry, fish and produce); (ii) Transportation (refrigerated containers); (iii) Distribution (Warehouses); and (iv) Point of Sale (retail grocers and fast food outlets). These target companies offer significant synergies with the existing operations and would add substantial revenue and income to the business. In addition, these companies offer distribution channels for the Company's dry media chlorine dioxide technology.
Raytec continues to work with its U.S. based investment bankers, Dresner Investment Services to execute its growth plan.
This initiative will be the key for the Company to grow faster and enter new markets over a shorter time frame. The targeted acquisition companies and the source of financing will be the subject of further press releases.
RAYTEC CAPITAL CORP.
Per: "JERRY A. MINNI"
Jerry A. Minni
President/Director |
