News Out!
DCI to Acquire Global Telecom Network
PR Newswire - April 09, 1998 10:41
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Jump to first matched term STRATFORD, Conn. April 9 /PRNewswire/ -- DCI Telecommunications, Inc.
(OTC Bulletin Board: DCTC) announced today the signing of a letter of intent,
with Global Telecom Network (GTN), a privately held telecommunications company
located in Fort Lauderdale, Florida, whereby DCI will exchange $5 million
worth of its common stock for all of the common stock of GTN. The entire
transaction is valued at $5 million.
GTN is a profitable, $7 million telecommunications company, providing
prepaid phone cards and one-plus service. It began as one of the pioneers of
the U.S. prepaid phone card market and has grown into one of the premier
companies within the market. Its customers include highly recognizable
companies such as Eastman Kodak, Target, Giant Foods, Xerox and Paychex.
GTN president Edward Dunne stated, "The combination of DCI's network and
switching capabilities coupled with GTN's extensive prepaid marketing and
distribution experience will create a company that can provide a higher
quality product and service, while at the same time, increasing its profit
margin and enabling us to greatly expand our marketing efforts."
Daniel J. Murphy, vice president for DCI, stated, "In conjunction with
DCI's other recently announced acquisitions, the GTN deal allows each company
to benefit from the inherent cost savings and synergy which will develop as we
consolidate all phone traffic through company switching facilities. The new
subsidiaries bring various strengths in the areas of sales, marketing, product
offerings and customer service. Cross-functional teamwork will allow us to
play off these strengths, gaining a competitive advantage and leading us to
our growth targets. By eliminating redundancies, and through economies of
scale, each new acquisition should be able to achieve greater profitability."
In recent news, DCI announced the signing of two letters of intent to
acquire Payless Communications and Edge Communications. These three
acquisitions are expected to increase DCI's annual revenues to over
$50 million by fiscal year ending March 31, 1999. In addition, the joint
venture with DataWave Systems, Inc., became effective April 1, 1998, and
should produce an additional $10 million in revenues.
DCI has retained Houlihan Lokey as its exclusive financial advisor and
investment banker in connection with the Company's corporate finance and M&A
objectives. Specifically, Houlihan Lokey has been hired to assist the Company
to raise $20 million on an immediate basis, for various strategic
acquisitions, identify acquisition candidates and advise the Company on the
same, and sell the Company's non-core assets.
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, Spain and Denmark. The company recently reported sales of
$6.2 million and $1.3 million in profit (13 cents per share) for the first
nine 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 filing, with the Securities and Exchange Commission.
SOURCE DCI Telecommunications, Inc.
/CONTACT: Craig K. Murphy, Director, Investor Relations of DCI
Telecommunications, Inc., 203-380-0910, ext. 301, email dcitel@aol.com/
/Company News On-Call: prnewswire.com or fax, 800-758-5804,
ext. 107358/
/Web site: dcic.com
(DCTC) |
