TORONTO and VANCOUVER, Oct. 1,
2015 /CNW/ - BSM Technologies Inc. ("BSM") (TSX-V:GPS),
a leading provider of remote monitoring, fleet management, and
fleet diagnostics systems, and Webtech Wireless Inc. ("Webtech
Wireless") (TSX:WEW), a leading provider of GPS fleet management
solutions, are pleased to announce the successful completion of the
previously announced "merger of equals" type of transaction of the
two companies pursuant to a plan of arrangement under the
Business Corporations Act (British
Columbia) (the "Arrangement"), whereby BSM has acquired all
of the issued and outstanding common shares of Webtech Wireless
("Webtech Wireless Shares").
"We believe we are now a strong leader in the telematics space
as a result of this merger," said Aly
Rahemtulla, President and CEO of BSM. "By bringing together
two prominent North American entities, we are aiming to create a
force in telematics that will see us increase our subscriber count,
accelerate revenue growth and significantly enhance our
profitability. The strength of our rail and construction verticals
combined with Webtech Wireless' leading position in the government
vertical will create a bigger and better organization."
Shareholders of Webtech Wireless approved the Arrangement on
September 23, 2015, while
shareholders of BSM approved the issuance of the shares pursuant to
the Arrangement on the same date, and the Supreme Court of
British Columbia issued the final
order approving the Arrangement on September
25, 2015.
The merger of equals is expected to nearly double the
stand-alone revenue of either company and significantly enhance the
profitability of each business. The combined company will have
total revenue of $58 million,
of which $37 million is recurring
service revenue, and Adjusted EBITDA of $4.75 million, all on a trailing 12-month
basis prior to anticipated synergies. Expected operational and
financial synergies are anticipated to result in near-term
annualized cost savings of $1.5
million, with additional expected annualized cost synergies
of $2.5 million to $3.5 million as
the companies complete the integration process during the 12 to 18
months post-closing.
Pursuant to the Arrangement and effective upon closing of the
Arrangement, the directors of BSM are: (i) Mr. Frank Maw; (ii) Mr. Pierre Belanger; (iii) Mr. Aly Rahemtulla; (iv) Mr. Leonard Metcalfe; (v) Mr. John Gildner; and (vi) Mr. Andrew Gutman. Mr. Gutman, Mr. Metcalfe and Mr.
Gildner were previously directors of Webtech Wireless. Joining the
current BSM senior executive team from Webtech Wireless is
Larry Juba as the Chief Operating
Officer.
"This past year has been transformational for Webtech Wireless,"
said Andrew Gutman, Chairman of the
Board of BSM. "We reached our goal of improved top-line growth and
a return to profitability. With this merger we now begin a new
chapter for our company. We expect the combination of BSM and
Webtech Wireless will create a company that will increase scale,
strengthen our competitive position, and capture a larger North
American market share."
Pursuant to the Arrangement, Webtech Wireless has become a
wholly-owned subsidiary of BSM and all of the issued and
outstanding Webtech Wireless Shares were transferred to BSM in
consideration for the issuance by BSM of $0.52 in cash plus 2.136 BSM common shares ("BSM
Shares") for each Webtech Wireless Share (the "Exchange Ratio"). In
addition, each outstanding option to acquire Webtech Wireless
Shares was exchanged for a replacement option exercisable for BSM
Shares, with the number and price adjusted by the Exchange Ratio.
Pursuant to the Arrangement, an aggregate of 43,180,516 BSM Shares
have been issued to former holders of Webtech Wireless Shares, and
an aggregate of 1,636,069 BSM Shares are reserved for issuance
pursuant to the exercise of the replacement options. Following the
Arrangement, BSM has 89,855,602 BSM Shares outstanding, with BSM
shareholders owning approximately 51% of the BSM Shares and
former Webtech Wireless shareholders owning approximately 49% of
the BSM Shares (excluding BSM Shares that are held in escrow).
Full details of the Arrangement and certain other matters can be
found in the joint management information circular (the "Joint
Circular") of BSM and Webtech Wireless dated August 19, 2015. An electronic copy of the Joint
Circular is available on BSM's website at www.bsmwireless.com and
on Webtech Wireless' website at www.webtechwireless.com. It is also
available under the issuer profile of each company on SEDAR at
www.sedar.com.
A Letter of Transmittal was sent to each registered holder of
Webtech Wireless Shares together with the Joint Circular. It
contains instructions for obtaining delivery of a Direct
Registration System Advice or physical share certificate evidencing
ownership of BSM Shares and a cheque representing the cash
consideration which such registered holder of Webtech Wireless
Shares is entitled to receive upon the Arrangement becoming
effective. The Letter of Transmittal is also available under the
issuer profile of Webtech Wireless on SEDAR at www.sedar.com. For
further details, see the Joint Circular.
TSX Graduation
BSM is also pleased to announce that it
has received conditional approval from the Toronto Stock Exchange
("TSX") to graduate from the TSX Venture Exchange and list the BSM
Shares on the TSX.
Final approval of the listing of the BSM Shares on the TSX is
subject to BSM meeting certain standard requirements of the TSX.
BSM expects to satisfy all of the necessary conditions and will
make a further announcement once the TSX has issued a bulletin
confirming the date on which trading of the BSM Shares on the TSX
will occur. Upon its listing on the TSX, the BSM Shares will
continue to trade under the symbol "GPS". In connection with the
listing on the TSX, the BSM Shares will be delisted from the TSX
Venture Exchange, such delisting to be effective as of the date
such securities commence trading on the TSX.
Cautionary Note Regarding Forward-Looking
Statements
This news release includes certain
forward-looking statements or information under applicable
Canadian, U.S. and other securities laws. Such forward-looking
information and statements are often, but not always, identified by
the use of words such as "seek", "anticipate", "believe", "plan",
"estimate", "expect" and "intend" and statements that an event or
result "may", "will", "should", "could", or "might" occur or be
achieved and any other similar expressions. Such forward-looking
information includes but is not limited to, statements with respect
to the future financial or operating performance of the combined
organization and their respective verticals, statements regarding
synergies and financial impact of the Arrangement, the benefits of
the Arrangement and the timing and possible outcome of regulatory
matters, including BSM's application to graduate to the TSX. These
forward-looking statements, and any assumptions upon which they are
based, are made in good faith and reflect our current judgment
regarding the ability of the parties to receive, in a timely manner
and on satisfactory terms, the necessary stock exchange and
regulatory approvals, efficiently and successfully completing a
network operating centre consolidation, efficiently and
successfully completing a hardware and software consolidation,
receiving increased volume discounts from suppliers and efficiently
and successfully realizing operational efficiencies. Management
believes that these assumptions are reasonable; however, some risks
include, but are not limited to, non-completion of BSM's
application to graduate to the TSX, including due to the parties
failing to receive, in a timely manner and on satisfactory terms,
the necessary stock exchange and regulatory approvals, the failure
to efficiently or successfully complete network centre
consolidation, the failure to efficiently or successfully complete
hardware and software consolidation, the failure to realize or
receive increased volume discounts from suppliers and the failure
to efficiently or successfully achieve the expected operational
efficiencies. Readers are cautioned that this information may not
be appropriate for any other purposes. Forward-looking information
is subject to known and unknown risks, uncertainties and other
factors that could cause actual results to differ materially from
those contained in the forward-looking information. Some of these
risks, uncertainties and other factors are described under the
heading "Risk Factors" in BSM's annual management's discussion and
analysis and in the Joint Circular, each available at
www.sedar.com. Forward-looking information is based on estimates
and opinions of management at the date the statements are made.
Except as required by applicable law, BSM does not undertake any
obligation to update forward-looking information. Readers should
not place undue reliance on forward-looking information.
About BSM Technologies Inc. (www.bsmwireless.com)
BSM Technologies Inc., through its subsidiaries BSM Wireless Inc.
and Webtech Wireless Inc., is a leading provider of remote
monitoring, fleet tracking, fleet maintenance, and business
intelligent engine providing real time, web-based tracking of
mobile and fixed assets. BSM provides solutions for commercial,
government, and law enforcement organizations who manage and
operate diverse assets and large fleets, and who seek to enhance
customer service, improve the safety of their drivers and vehicles,
and lower business costs.
All amounts in Canadian dollars (CAD$) unless otherwise noted.
Neither the TSX, the TSX Venture Exchange nor their Regulation
Services Provider (as that term is defined in policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release. No stock exchange, securities
commission or other regulatory authority has approved or
disapproved the information contained herein.
SOURCE BSM Technologies Inc.