News:
Tuesday December 8, 4:52 pm Eastern Time
Company Press Release
SOURCE: PEN INTERCONNECT, INC.
PEN INTERCONNECT Signs Intent to Merge With Transdigital Communications Corporation
Transdigital Plans to Make Live TV Programming Available For Commercial Aircraft & Cruise Ship Passengers
SALT LAKE CITY, Dec. 8 /PRNewswire/ -- PEN INTERCONNECT, INC. (Nasdaq: PENC - news) today announced that it has signed a non-binding Letter of Intent to merge with Transdigital Communications Corporation (''Transdigital''). Specific terms of the deal were not disclosed. The closing is subject to the completion of comprehensive due diligence, the execution of a definitive agreement, board and shareholder approval of both parties, and Nasdaq and regulatory clearances.
Transdigital, based in Brea, CA, is a privately-held developer of state-of-the-art, on-line entertainment and information database systems for the transportation markets, which include narrow bodied commercial aircraft (70% of commercial fleets) and cruise ships. Transdigital's management team has more than 70 years of aggregate experience in building integrated communications products and support systems for the airline industry. Transdigital products include: a real time satellite broadcast network for airlines and cruise ships, a proprietary line of digital servers with large storage capacity for aircraft operation and a coax-based digital interactive system for cruise ships and resort hotels.
When completed, Transdigital's satellite broadcast network will present live programming to airline passengers and will transmit digitally compressed media and data files for storage and playback on Transdigital's onboard file servers. Transdigital has also developed a dynamic maintenance reporting system which reduces the airlines' maintenance costs by capitalizing on Transdigital's proprietary internet-based fault reporting and diagnostic network -- ''Maintenance-Alert.''
Richard Bertagna, Transdigital's President and CEO said, ''This merger will aid Transdigital Communications Corporation in accelerating the introduction of several new industry leading products by providing timely additional capital necessary to meet the market demands. PEN's manufacturing division, InCirT, is an ISO 9002 certified company. Its high quality standard of excellence reinforces Transdigital's commitment to provide our customers with the most reliable products in the industry.''
Commenting on the announcement, Steve Fryer, President of PEN, stated, ''PEN's manufacturing and power supply assets will provide vertical integration to Transdigital as it prepares to enter into meaningful production of its systems for commercial deployment. It gives PEN the opportunity to diversify its product offerings and share in the upside of Transdigital's exciting proprietary technologies and products which are addressing enormous markets. We also gain a team of outstanding seasoned professional mangers and entrepreneurs.''
PEN also announced that it will take one-time charges of approximately $3.5 million, or an additional $2.6 million over the previously announced $900,000 charge, for the year ended September 31, 1998. The merger of Transdigital will bring approximately $1.2 million of additional net assets to the balance sheet on a proforma basis.
ABOUT TRANSDIGITAL COMMUNICATIONS CORPORATION
Headquartered in Brea, CA, Transdigital Communications Corporation has been involved in the development of several advanced media communication products setting a higher performance standard for the in flight entertainment industry. The Company's founders have been recognized for many years as industry visionaries in developing products which incorporate emerging technologies with passenger entertainment and communications expectations. The Company has recently expanded its market with the introduction of its products to the cruise line industry and has installed a digital audio distribution system on the new Disney ships. The Company has also recently successfully completed an in service trial of its interactive passenger communication cable system on one of the newest ships of another major cruise line operator.
ABOUT PEN INTERCONNECT, INC.
Headquartered in Salt Lake City and with divisions in Irvine, CA and Orem, UT, PEN is a manufacturing services solution provider, offering contract manufacturing EMSI (electronic manufacturing service industry), internal and external custom cable and harness interconnections, custom power supply and battery charger design and manufacturing and mobile satellite positioning equipment for OEMs in the computer, peripheral, telecommunication, instrumentation, medical and testing equipment industries. For a complete on-line investors package, including current research reports on the Company, visit virtualir.com or product data at pen-interconnect.com.
The statements contained in this news release that are not purely historical are forward-looking statements that may involve risks and uncertainties. The Company's actual results may differ significantly from the results contained in the forward-looking statements. Factors that might cause such differences include, but are not limited to, the effect of losses and other factors on the Company's credit facilities, business and results of operations; the Company's limited capital resources and its ability to fulfill its existing obligations and ongoing capital needs; risks associated with excess or obsolete inventory; the potential impairment of assets; the Company's dependence on key customers and their financial viability; the impact of competition; and the Company's abilities to effectively manage growth. These and other risk factors are discussed in the Company's filings on Forms S-3, 8-K, 10-QSB and 10-KSB.
SOURCE: PEN INTERCONNECT, INC. |
