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WirelessDevNet.com Press Release
Digital Angel Corporation Completes Acquisition of McMurdo Marine Electronics
SO. ST. PAUL, Minn.-- Digital Angel Corporation (Amex:DOC), an advanced technology company in the field of rapid and accurate identification, location tracking and condition monitoring of high-value assets, announced today that it has completed its acquisition of certain assets and customer contracts of McMurdo Ltd., the U.K.’s premier manufacturer of emergency location beacons, from Chemring Group PLC. Digital Angel purchased McMurdo for approximately $5.7 million in cash (USD) and will have additional deferred payments ranging from $0-$3 million (USD), dependent upon performance of the business following the sale.
Digital Angel President and Chief Executive Officer Kevin McGrath said, “Simply put, we believe our strategic acquisition of McMurdo is the perfect complement to our SARBE business. Its network of approximately 60 outlets will significantly broaden our emergency location beacon product offering to serve the military and commercial maritime sectors and provide stability to our revenue base. As we stated previously, we expect the McMurdo acquisition to add at least $8-9 million of additional revenue for the remainder of 2007. More importantly, we believe McMurdo’s steady stream of business will generate more predictable profits in the SARBE business on a go-forward basis.”
“For several years we have explored ways to turn the SARBE business into a world leader in the broad customer base of multipurpose search and rescue beacons rather than just a leader in the important, but cyclical, military market. The acquisition of McMurdo creates a business unit which serves both the commercial and military markets. In addition to revenue growth, we have a plan in place to improve margins at McMurdo in the near term. Currently, McMurdo buys the circuit boards, antennas, and batteries used in their location beacons. However, by utilizing our established manufacturing capabilities at our Signature Industries operations in the U.K., we will manufacture those components, and expect to have a more profitable product,” continued McGrath.
For nearly seven decades, McMurdo has distinguished itself as a leader in the development and manufacturing of safety equipment technology. Its products, including the original EPIRB (Emergency Position Indicating Radio Beacon) and the first GMDSS (Global Maritime Distress and Safety System) approved Search And Rescue Transponder, have become standard, lifesaving, equipment on many recreational, commercial and military marine vehicles. In 2000, McMurdo demonstrated the versatility of its technology successfully launching its first PLB (Personal Locator Beacon) for use on land, sea or air. The company continues to lead the way in the functionality and accuracy of emergency location beacons.
Emergency Locator Beacons represent a core competency and key growth market for Digital Angel and its subsidiary Signature Industries. Impending changes to the COSPAS-SARSAT satellite monitoring system mean much of the equipment currently in service will require replacement by February 2009. McMurdo and SARBE, with its improved range of radios such as the SARBE G2R and the SARBE 6-406, are uniquely positioned to exploit these opportunities in their respective markets.
The SARBE Division of Signature Industries manufactures a complete line of military search and rescue beacons and has worked closely with the Royal Air Force, a branch of the UK Ministry of Defense, for more than 50 years. The acquisition of McMurdo’s technology and its manufacturing infrastructure should significantly strengthen Digital Angel’s position in the Locator Beacon Industry.
About Digital Angel Corporation
Digital Angel Corporation (www.DigitalAngelCorp.com) develops and deploys sensor and communications technologies that enable rapid and accurate identification, location tracking, and condition monitoring of high-value assets. Applications for the Company’s products include identification and monitoring of humans, pets, fish, poultry and livestock through its patented implantable microchips; location tracking and message monitoring of vehicles and aircraft in remote locations through systems that integrate GPS and geosynchronous satellite communications; and monitoring of asset conditions such as temperature and movement, through advanced miniature sensors. Digital Angel Corporation is majority-owned by Applied Digital Inc. (Nasdaq:ADSX), which also owns a majority position in VeriChip Corporation (NASDAQ:CHIP).
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