MEMORY: Memory Corporation acquisition of the outstanding 49% interest in Dtec Memory Corporation
MAR 26, 1999, M2 Communications - Memory Corporation plc ("Memory"),
the EASDAQ listed digital data management company, today announces
that, subject to it receiving the proceeds of its recent $4m Placing,
it will acquire the outstanding 49% interest in Dtec Memory Corporation
(Holdings) Limited ("DMC") from its minority partner, Datrontech Group
plc ("Datrontech"). Memory is paying GBP 1.75m for the balance of the
share capital it does not already own. In addition, DMC will repay to
Datrontech loans amounting in aggregate to GBP 0.72m (leaving a balance
outstanding of $1.18m which is repayable, together with accrued
interest on 31 December 2001).
DMC, which focused on the delivery of own branded memory products and
differentiated computer memory solutions in the UK and Europe was
originally formed as a joint venture between Datrontech and Memory in
January 1998. This was expanded in July 1998 via the injection of
Datrontech's Hong Kong based high volume memory business and Memory's
bespoke assembler and distributor of memory systems, Memory Plus. In
the year ended 31 December 1998, DMC made an unaudited profit before
tax of GBP 0.18 million on turnover of GBP 47.2m. As at 31 December
1998, the net tangible assets of DMC were GBP 0.32m.
Datrontech and Memory will continue to work closely in the future
particularly with regard to the new generation of memory products and
Memory's proprietary DRAM technology which includes Direct Rambus RIMM
Modules ("DR-RIMM's"). DMC is one of only two companies in Europe
licensed by Rambus Inc. to supply DR-RIMM's into the European PC
market. In order to provide access to this and other technologies,
Datrontech has signed an initial five year licensing agreement with
DMC. In consideration for the grant of the licence, Datrontech will pay
Memory GBP 0.5m in cash. Memory has also entered into a service
agreement with Datrontech whereby it will provide DMC with certain
support services (principally relating to facilities, logistics,
financial management, marketing and communications) and a three year
supply agreement under which DMC will supply Datrontech with unbranded
memory modules.
David Savage, Chief Executive Officer of Memory Corporation plc
said.. "As shareholders will be aware, for us to be truly successful in
the adoption of our technologies, we need to address a number of
different sales channels ranging from the indirect routes to market
such as the integrated memory manufacturers, OEMs and third party
module manufacturers as well as the direct routes which can often speed
up the acceptance of new products and emerging technologies. DMC
provides access to a number of those routes to market."
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