8th Feb 2007 09:00
Gas Turbine Efficiency plc (LSE:GTE), a leading supplier ofadvanced high pressure gas turbine cleaning systems for the aviationand power generation industries, announces its acquisition of ControlCenter LLC ("Control Center") for $4 million, payable in cash and newordinary GTE shares. £ Control Center, based in Orlando, designs and manufactures a widerange of fluid, combustion and control sub-systems aimed at industrialgas turbines primarily in the power generation, oil & gas, aerospaceand pharmaceuticals sectors. Established in 1963, Control Centersupplies products and services to many blue chip Original EquipmentManufacturers (OEMs), industrial customers and end users includingLockheed-Martin, Excel Energy, Progress Energy, Calpine, FPL EnergyServices, Neuman-Esser and CH2M Hill. £ Unaudited results for Control Center for the year ending 31December 2006 include $8.9 million in order bookings, sales of $7.1million and operating profits of 0.1%. The purchase considerationincludes retirement of Control Center's long term debt of $1.3million. At completion, the net negative asset value is expected to beapproximately $0.2 million. £ The acquisition represents GTE's first strategic investment forpositioning and scaling of its industrial segment since admission tothe AIM market of the London Stock Exchange ("AIM") in December 2005. £ Rationale for the acquisition £ The Company believes that the proposed acquisition will deliverconsiderable long term operational and synergy benefits to GTE.Specifically, these include: £ -- Addition of a proven, Tier 1 supplier to OEMs and end users in key growth segments of power generation, oil & gas, pharmaceutical and aerospace £ -- Broadening of GTE's technology portfolio with complementary product lines in fuel systems, combustion monitoring systems and controls £ -- Creation of a cost effective, scalable operations base in North America with demonstrated ability to drive productivity and quality initiatives £ -- Expansion of commercial channels and customer relationships with an experienced sales team £ -- Integration of application engineering and prototyping capability to accelerate time to market for new products £ Terms of the transaction £ Under the terms of the deal, GTE will pay a consideration of $4million for the entire issued capital of Control Center. Theconsideration will be satisfied by $2 million in cash and $2 millionthrough the issue of 2,256,064 million new ordinary GTE shares at 45pence. The new GTE shares being issued as part of the considerationwill be held in escrow and released unconditionally in tranches over a36-month period. £ Completion and additional listing of shares £ Completion of the transaction is conditional upon admission totrading of the new ordinary shares being issued pursuant to theacquisition. Application has been made today for 2,256,064 ordinaryshares of 0.2 pence par value each in the Company ('Ordinary Shares')to be admitted to trading on AIM. £ The new Ordinary Shares are being issued as vendor considerationand rank pari passu with the Company's existing Ordinary Shares anddealings are expected to commence on 14 February 2007 on AIM. £ Commenting on the acquisition, Mr Steven Zwolinski, CEO of GTE,said: "The acquisition of Control Center, which has a proven trackrecord of supplying into our key markets, brings compelling financial,technical and operational synergies to GTE. It will enable fastergrowth, world class execution and serve as an important globaloperations base. The expanded portfolio of product solutions willoffer significantly more value to OEMs and end customers in the powergeneration, oil & gas and other industrial segments." £ Notes to Editors: £ About GTE £ GTE, whose shares are trading on the AIM market of the LondonStock Exchange, develops, assembles and markets cleaning systems, aswell as other associated equipment, for the internal cleaning of gasturbine compressors. The Company sells its products globally tointernational blue chip customers in the aviation and industrialsectors and to date its products have been used on over 1,000 gasturbines across 34 countries in Europe, the Middle East, Asia and theAmericas. Its operational centres are located in Stockholm, Sweden; StPetersburg, Russia and Houston, Texas, USA.http://www.gtefficiency.com/ £ About Control Center £ Control Center LLC is a Tier One direct source of IntegratedProcess Control Solutions for Industrial Plants, OEMs and EPC's. Our45-year history of providing high quality solutions has resulted inthousands of installations worldwide. Whether modernizing existingoperations, constructing a new facility or looking to outsource,Control Center's Systems, Parts, Service and Personnel can guaranteeyour project's success. http://www.controlcenter.net/ £ Certain statements made in this announcement are forward-lookingstatements. These forward-looking statements are not historical factsbut rather are based on the Company's current expectations, estimatesand projections about its industry, its beliefs and assumptions. Wordssuch as 'anticipates', 'expects', 'intends', 'plans', 'believes','seeks', 'estimates', and similar expressions are intended to identifyforward-looking statements. These statements are not guarantees offuture performance and are subject to known and unknown risks,uncertainties and other factors, some of which are beyond theCompany's control, are difficult to predict and could cause actualresults to differ materially from those expressed or forecasted in theforward-looking statements. These factors include, amongst others, theability to consummate the transaction; the ability of GTE tosuccessfully integrate Control Center's operations and employees; theability to realise anticipated synergies and cost savings; technologyrisks, including dependence on core technology; fluctuations inquarterly results; dependence on new product development; rapidtechnological and market change; reliance on sales by others;management of growth; dependence on key personnel; rapid expansion;growth of the internet; financial risk management; and future growthsubject to risks. The Company cautions shareholders andprospective shareholders not to place undue reliance on theseforward-looking statements, which reflect the view of the Company onlyas of the date of this announcement. The forward-looking statementsmade in this announcement relate only to events as of the date onwhich the statements are made. The Company will not undertake anyobligation to release publicly any revisions or updates to theseforward looking statements to reflect events, circumstances orunanticipated events occurring after the date of this announcementexcept as required by law or by any appropriate regulatory authority. Copyright Business Wire 2007Related Shares:
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