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STRATFORD, Conn., Feb. 3 /PRNewswire/ -- DCI Telecommunications, Inc.
(OTC Bulletin Board: DCTC), an international supplier of telecommunications
services, today announced the signing of a letter of intent to acquire
WorldPass Communication Corp. (WPCC), a $15.0 million privately held company
located in Aventura, Florida. The agreement, subject to due diligence, calls
for a stock for stock exchange and other remuneration, the value of which
equals $10.0 million.
WPCC is a rapidly growing and historically profitable company that offers
One-Plus and Call Back long distance services with a customer base that is
primarily located in South America. WPCC is also a registered Internet
Service Provider, including fax service over the Internet. On average, the
company's sales have been doubling each of the past six years.
Under the agreement, DCI offered Shaul Shalev, WPCC's president, to be
Chairman of the Board of DCI Telecommunications. Mr. Shalev, a former Israeli
Diplomat, has an enlightening view of the transaction, "I am not selling a
company, I've inherited a much larger company."
With its dealer/agent network, the acquisition of WorldPass expands DCI's
service area and enables the company to consolidate telecom traffic at WPCC's
switching facilities in Aventura. It possesses the capacity to handle all of
the company's U.S. and Canadian minutes. This consolidation could result in
tremendous savings for the various subsidiaries, translating into more
competitive products as well as better margins.
DCI spokesperson Michael Zwebner said, "The acquisition of WorldPass
heralds a new milestone in the company's growth plans. WorldPass's vast
experience in the South and Central American markets fills an integral part of
our expansion plans."
Joseph Murphy, president & chief executive officer of DCI, said he was
pleased to add such a high caliber company as well as its leader Mr. Shalev,
to help formulate DCI's future. "The combination of the two companies should
improve DCI's overall profitability and result in revenues in excess of
$25.0 million on a proforma basis."
Recently DCI declared a special cash dividend of one cent per share on the
company's common stock. The dividend is payable on March 23, 1998 to
stockholders of record at the close of business on February 23, 1998 and was
the first in the company's history. It also recently announced plans to
execute a $5.0 million buyback program, whereby it intends to repurchase
shares on the open market and in privately negotiated transactions at
prevailing market prices. Timing of the repurchases will depend on market
conditions, the market price of DCI's common stock and management's assessment
of DCI's liquidity and cash flow needs.
In a related transaction, DCI sold R&D Scientific Corporation back to its
former owner as part of a program to focus the company on products and
services solely within the telecom industry. This action will necessitate a
revision of previously filed 10Q's and 10K's.
DCI Telecommunications is an international supplier of telephone services
including long distance service, prepaid cellular and Internet products. The
company has an extensive distribution network throughout North America, Europe
and the Far East and owns telephone switching facilities in Canada, the United
Kingdom and Denmark. The company recently reported sales of $4.6 million and
$1.3 million in profit (or 13 cents per share) for the first six months of
fiscal 1998.
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 risks 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.
SOURCE DCI Telecommunications, Inc.
/CONTACT: Craig K. Murphy, Director, Investor Relations of
DCI Telecommunications, 203-380-0910 ext. 301, or dcitel@aol.com/
/DCI Telecommunications press releases are available at no charge through
PR Newswire's Company News On-Call fax service and on PRN's Web Site. For a
menu of DCI Telecommunications press releases or to retrieve a specific
release, call 800-758-5804, extension 107358, or prnewswire.com on
the Internet./ /Web site: dcic.com (DCTC) |
