ThermaCell to Acquire American Paints;
Revenue Run Rate for ThermaCell to Climb More Than
300% in FY99
SARASOTA, Fla., Nov. 23 /PRNewswire/ -- ThermaCell Technologies, Inc. (Nasdaq: VCLL - news, VCLLW - news) has acquired regional paint manufacturer and distributor American Paints, Inc. of Pompano Beach for 527,000 shares of restricted common stock.
With $2.5 million in annual revenues, generating approximately $200,000 in operating profit, American Paints will be immediately accretive and double ThermaCell's current sales run. The acquisition could be even more accretive after operations are consolidated into ThermaCell's Miami-based Atlas paint manufacturing and distribution unit, reducing American Paints' costs and increasing operating profits by an additional $300,000-$400,000.
Negotiations began anew and converted to an all stock deal as a result of the recent gains in the price of ThermaCell's stock, which has climbed approximately 200% from the $0.50 range in September to its current $1.50-$2.00 range. ThermaCell had signed a letter of intent in September to acquire American Paints for a combination of cash and stock valued at $1 million,but later both sides terminated discussions.
Today's acquisition is part of ThermaCell's strategy to significantly expand the Company's presence through acquisition and internal growth in building paints, coatings and materials and expanded use of the Company's innovative VaxCell™ microsphere technology. VaxCells™ enable the Company to manufacture enhanced building paints, coatings and materials that provide greater insulation, protection, strength, longevity and value at a lower cost than conventional materials.
Pending are the closing of the acquisition of Sealco Systems, Inc. and T-Coast Pavers, Inc. of Stewart, Florida, which would add more than $2 million in sales, and the opening of ThermaCell's pilot VaxCell™ manufacturing facility, which is expected to add $1-$3 million in revenues. Together with ThermaCell's current run rate, recent new business announcements, and the American Paints acquisition, ThermaCell is expected to become profitable in the March 1999 quarter and the revenue run rate is expected to increase more than 300% to more than $9 million in Fiscal 1999, not taking into account further business combinations under consideration.
John Pidorenko, Chairman, President and CEO, of ThermaCell, said the Company continues to aggressively pursue consolidation acquisition opportunities with other Sunbelt building paints, coatings and materials manufacturers and distributors. However, due to the number of inquiries ThermaCell has received, the Company has established a policy not to comment on any acquisition until an agreement is signed and will not comment on any in-process negotiations.
The American Paints acquisition will improve ThermaCell's distribution network across the Sunbelt states, in order to expand sales, and improve economies of scale in raw materials purchasing, in order to expand gross profit margins. Founded in the late 1970s, American Paints manufactures and markets specialty roof and metal coatings through its own retail outlet, a network of distributors, and on a direct basis to regional contractors. American Paints is ThermaCell's third acquisition in three years. ThermaCell acquired C. F. Darling Paint & Chemicals of Holiday, FL in 1995, Atlas Chemical of Miami in 1997, and Ladehoff Paint of Phoenix in March 1998.
ThermaCell Technologies, Inc. is a vertically integrated manufacturer and marketer of technologically enhanced coatings and building materials that provide greater insulation,protection, strength, longevity and value at a lower cost than conventional materials.
Forward-Looking Statements: This news release contains certain ''forward-looking'' statements within the meaning of the Private Securities Litigation Reform Act of 1995, which provides a new ''safe harbor'' for these types of statements. To the extent statements in this news release involve, without limitation, product development and introduction plans, the Company's expectations for growth, estimates of future revenue, expenses, profit, cash flow, balance sheet items, sell-through or backlog, forecasts of demand or market trends for the Company's product categories and for the industries in which the Company operates, or any other guidance on future periods, these statements are forward-looking statements. The Company assumes no obligation to update forward-looking statements.
Contact: Gary Fishman or Kimberly Boshara, 212-527-4808, both of ThermaCell Technologies
SOURCE: ThermaCell Technologies, Inc. |
