30th Jan 2006 07:01
DawMed Systems PLC30 January 2006 30 JANUARY 2006 DAWMED SYSTEMS PLC ("Dawmed" or "the Company") SALE OF CERTAIN ASSETS OF 'SSD' PRODUCTS TO BMM WESTON LIMITED The Board of Dawmed, the AIM listed medical devices company which designs,manufactures, sells and services washer-disinfector-dryers ("WDD") used by NHSTrust hospitals, private hospitals and clinics, is pleased to announce anAgreement for the sale of certain intangible assets, viz. the relevantintellectual property, know how and computer systems relating only to theproducts in the Company's Sterile Services Departments ("SSD") range, to BMMWeston Limited ("BMMW"). Under the terms of this Agreement Dawmed will continue to provide full testing,servicing, supply of spare parts and training to all of its existing SSDcustomers (including to those existing SSD customers to be supplied by BMMW inthe future) for the full life span of their machines and BMMW will manufactureand sell the SSD range of WDDs henceforth. As foreshadowed in the 2005 Interim and Year End Reports and Accounts, aftersome twelve months monitoring and evaluating the market trends, it has becomeclear that the NHS preference for the 'One Stop Shop' decontamination packagecombining large washer-disinfector-dryers with large sterilisers in the SSDs("Sterile Service Departments") of hospitals, which is dominated bymultinational companies, will continue. This trend, combined with the highworking capital requirements and low margins for SME companies like DawMedoffering separate products in that fiercely competitive SSD field, has convincedthe Board that shareholders' interests will be better served by the vigorous andexclusive exploitation of the higher margin products in the Company's portfoliowhich, together with its Support Services Operation, constitute the main driversof organic growth for the Company. The Agreement, which provides for, inter alia, a consideration of £100,000 grossagainst a book value of the relevant assets of circa. £24,000 and the purchaseof available stock at BMMW's discretion, is considered by both parties as alogical and mutually beneficial step which enables a One Stop Shop service to becreated from the two previously separate product lines. For DawMed, the beneficial effects of the Agreement will be the elimination ofnet losses attributable to the SSD products, the release of working capitalpreviously required by the SSD products and the application of the proceeds fromthe sale as further general working capital. This will enable the Company tofully concentrate its efforts on the more rewarding and recently expanded rangeof existing and new products for the Primary and Secondary Healthcare markets inthe UK, Europe and worldwide, viz: • "Clinic" bench top WDD - providing thermal disinfection for use in all NHS and private dentists, clinics and other primary healthcare practitioners and also targeting the European and worldwide markets; • "AERclens" bench top flexible nasendoscope washer-disinfector - a completely new product providing chemical disinfection for use in all NHS and private Ear, Nose & Throat ("ENT") Departments, clinics and consulting rooms and also targeting the European and worldwide markets; • New Wassenburg "pass-through" flexible endoscope washer-disinfector ("WD") and the continuation of the original Wassenburg space-saving flexible endoscope WD, both providing chemical disinfection for use in NHS and private Endoscopy Departments et al in the UK; and • New Wassenburg flexible endoscope drying/storage cabinets - providing a daytime and overnight sterile environment for use in NHS and private Endoscopy Departments et al in the UK. Kevin Gilmore, Executive Chairman, commented: "This Agreement is the highlysatisfactory culmination of a long and arduous examination of what is best forthe shareholders and stakeholders of the Company and the Board is confident ofthe beneficial effects that it will confer upon the Company for the immediateand long term foreseeable future". --ENDS-- Enquiries: DawMed Systems plc Tel: 01789 740010Kevin Gilmore, Executive Chairman Beaumont Cornish Limited Tel: 020 7628 3396Roland Cornish Bishopsgate Communications Limited Tel: 020 7430 1600Maxine Barnes / Dominic Barretto For further information please visit DawMed's website at www.dawmed.com Note to Editors: BMM Weston Limited is a private company whose diverse interests include themanufacture and sale of SSD sterilisers and with whom DawMed has collaborated inthe past to offer a 'One Stop Shop' service. However, it was without the successoriginally anticipated by both companies, mainly due to the inability to obtainthe cost savings that will now be achievable by BMM Weston as a result of theAgreement, thus enabling it to compete with multinational manufacturers on alevel playing field. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Adams