(PR NEWSWIRE) DJ: DCI Signs Definitive Agreement to Acquire Locus Corporat
DJ: DCI Signs Definitive Agreement to Acquire Locus Corporation
STRATFORD, Conn., July 23 /PRNewswire/ -- DCI Telecommunications, Inc. (OTC
Bulletin Board: DCTC), an international provider of telecommunications and
Internet services, announced today the signing of a definitive agreement to
acquire privately owned Locus Corporation, of Fort Lee, New Jersey. Locus is
a global provider of prepaid phone cards, international call back, long
distance and Internet services. The transaction, which is subject to
financing, involves a combination of cash and stock with a total valuation
of $25 million.
Since its founding in 1989, Locus has advanced to become a global provider
of integrated telecommunication services, building on its successes as a
reseller of telephone traffic. By entering into the Internet and wireless
market, it has furthered its technical capability, expanded the physical
traffic network and customer base and improved profitability.
Locus distributes prepaid phone cards in targeted ethnic markets in 35
states through more than 2,000 retail outlets. Its Customer Service Center
is staffed with multilingual representatives 24 hours a day. CallBack
service is provided to Argentina, Brazil, Thailand, Sweden and Korea. The
long distance service that Locus provides targets small business customers
in Asian communities. Additionally, Internet service is available in New
York and New Jersey and prepaid cellular service has just been launched in
the New York metro area as well.
Locus is profitable and is at a current annualized run rate of $50 million
in revenues. It has experienced rapid growth over the past five years.
Revenues have at least doubled each year since 1993. Revenues approximated
$17 million for 1997.
Russell B. Hintz, DCI's chief financial officer, stated, "This acquisition
will firmly establish DCI as a significant player in the international
telecommunications industry." The completion of this deal puts the combined
companies on an annualized run rate of $100 million, as DCI was at an
annualized run rate of approximately $50 million prior to the deal.
DCI recently finalized the acquisition of Edge Communications, a Maryland-
based prepaid phone card company, in a transaction valued at $8 million.
With the rapid growth of Edge, as evidenced by escalating revenues, DCI
terminated acquisition negotiations with Global Telecom Network. The
signing of this definitive agreement with Locus is a continuation of DCI's
growth plan. This new acquisition significantly expands DCI's current
infrastructure. It not only increases the company's product line, but also
enhances the hardware that can be utilized by other DCI subsidiaries to
extend DCI's capability to further cover the globe.
DCI Telecommunications is an international provider of telephone services,
including long distance, prepaid telephone cards and Internet services. It
has an extensive distribution network throughout North America, Europe and
the Far East, owns telephone switching facilities in Canada, the United
Kingdom, Spain and Denmark, and has 12 operating facilities serving
customers in eight countries. DCI recently reported sales of $8.1 million
and $938,000 in profit before preferred dividends (8 cents per share), for
the fiscal year ended March 31, 1998 (which excludes Edge Communications).
Safe Harbor Statement under the Private Securities Litigation Act of 1995:
The statements which are not historical facts contained in this press
release are forward-looking statements that involve certain risks and
uncertainties including but not limited to risk; associated with the new
uncertainty of future financial results, additional financing requirements,
development of new products, regulatory approval processes, the impact of
competitive products or pricing, unpredictability of patent protection,
technological changes, the effect of economic conditions and other
uncertainties detailed in the company's filings with the Securities and
Exchange Commission.
/CONTACT: Craig K. Murphy, Director, Investor Relations of DCI
Telecommunications, 203-380-0910 ext. 3108, or InvestorRelations@dcic.com/
09:36 EDT
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