April 19, 2002
Wescam eyes sale, merger
Seeks to maximize value
Steve Erwin
The Canadian Press
TORONTO - The chairman of Wescam Inc. acknowledged yesterday a sale or merger of the company "is under consideration" because the surveillance camera developer has failed to maximize shareholder value.
"If the Canadian capital markets have not recognized the intrinsic value of this company, then certainly there's other players out there in the capital markets that should so recognize," Howard Beck told the annual meeting in downtown Toronto.
Wescam designs high-end image stabilization, enhancement and transmission technology and counts the U.S. military as a major customer.
However, the Burlington, Ont., company's shares have been falling this week after it lowered its 2002 revenue and profit forecasts and announced further job cuts.
The company's stock closed yesterday at $5.71, down 9¢.
In its profit warning this week, the company said it expects to generate $135-million in revenue and $2.9-million in net profits or 15¢ a share.
That was below a previous prediction of up to $160-million in revenue and up to $8.8-million in net earnings or 45¢ per share.
Wescam also announced it is cutting its workforce by 12% to about 450 employees.
Wescam refocused its business last year on the defence industry in an attempt to take advantage of a huge rise in spending by the U.S. military in the aftermath of the Sept. 11 terrorist attacks and the war on terrorism. |
