EsmertecTM (SWX: ESMN), a leading provider of software platforms, applications and services to communications device manufacturers and mobile telecom operators, signed on July 31, 2008 an agreement with Sofinnova Partners and Safran as future shareholders of Sagem Wireless (company to be incorporated) to acquire Sagem Mobiles' software platform activities. The transaction is subject to approval of Sagem Mobiles' employee representative bodies and is expected to be finalized by Q4 2008.
Through the transaction, Sagem Wireless will receive 3'210'790 shares of Esmertec AG (12% of the capital as at June 30, 2008, on a fully diluted basis):
- 1'332'580 shares (4.98%) for the acquisition of Sagem Mobiles' software platform activities. These activities will ensure Esmertec a minimum of EUR 51 million revenues over 3 years, guaranteed by a software license and services contract with Sagem Wireless, positively contributing to Esmertec's profitability and cash position. These shares are already available in the form of authorized capital, created by the Annual General Meeting of May 15, 2008.
- Additional 1'878'210 shares (7.02%) for the acquisition of all related assets, intellectual property and patents.
During Q4 2008, Esmertec will invite its shareholders to an Extraordinary Shareholders' Meeting to vote on an increase of the authorized capital by 2'413'342 shares, valid for a period of 2 years. This proposed capital increase is earmarked for the finalization of the acquisition (which will require 1'878'210 shares) as well as for strengthening our capability to pursue further strategic moves (for which 535'132 shares are planned).
This represents a significant step ahead in the development of Esmertec's future business opportunities. By enlarging its existing products and services portfolio, Esmertec will own major software components that are necessary to design and manufacture mobile phones: a complete software platform that operates the core phone functions, complemented by a powerful Java-based application platform that empowers all the phone multimedia features.
"Following our strategy, we are in a well focussed way diversifying our offering of mobile software solutions", Esmertec CEO Thomas Hornung said. "Sagem Mobiles' software platform will be a strong asset for Esmertec, representing several hundreds of man-year of development, being already deployed in millions of mobile phones and carrying a great potential to close additional business for the coming years. Our first intention is clearly to accelerate the commercialization of the software platform, leveraging our existing sale and marketing channels as well as the strong customer relationships we have already forged. The initial software license and services contract with Sagem Wireless will be a substantial driver for Esmertec to grow on a profitable basis as well as strengthening our cash situation. We are significantly consolidating our position as an established key-player in the mobile industry".
Furthermore, Esmertec will expand its research and development expertise by welcoming a great team of software and hardware engineers, all based in Cergy-Pontoise, near Paris in France. Esmertec will put in place the appropriate organization, development environment and processes to integrate the team into Esmertec Group to design additional compelling software platforms and solutions.
Through the transaction, Sagem Wireless will receive 3'210'790 shares of Esmertec AG (12% of the capital as at June 30, 2008, on a fully diluted basis):
- 1'332'580 shares (4.98%) for the acquisition of Sagem Mobiles' software platform activities. These activities will ensure Esmertec a minimum of EUR 51 million revenues over 3 years, guaranteed by a software license and services contract with Sagem Wireless, positively contributing to Esmertec's profitability and cash position. These shares are already available in the form of authorized capital, created by the Annual General Meeting of May 15, 2008.
- Additional 1'878'210 shares (7.02%) for the acquisition of all related assets, intellectual property and patents.
During Q4 2008, Esmertec will invite its shareholders to an Extraordinary Shareholders' Meeting to vote on an increase of the authorized capital by 2'413'342 shares, valid for a period of 2 years. This proposed capital increase is earmarked for the finalization of the acquisition (which will require 1'878'210 shares) as well as for strengthening our capability to pursue further strategic moves (for which 535'132 shares are planned).
This represents a significant step ahead in the development of Esmertec's future business opportunities. By enlarging its existing products and services portfolio, Esmertec will own major software components that are necessary to design and manufacture mobile phones: a complete software platform that operates the core phone functions, complemented by a powerful Java-based application platform that empowers all the phone multimedia features.
"Following our strategy, we are in a well focussed way diversifying our offering of mobile software solutions", Esmertec CEO Thomas Hornung said. "Sagem Mobiles' software platform will be a strong asset for Esmertec, representing several hundreds of man-year of development, being already deployed in millions of mobile phones and carrying a great potential to close additional business for the coming years. Our first intention is clearly to accelerate the commercialization of the software platform, leveraging our existing sale and marketing channels as well as the strong customer relationships we have already forged. The initial software license and services contract with Sagem Wireless will be a substantial driver for Esmertec to grow on a profitable basis as well as strengthening our cash situation. We are significantly consolidating our position as an established key-player in the mobile industry".
Furthermore, Esmertec will expand its research and development expertise by welcoming a great team of software and hardware engineers, all based in Cergy-Pontoise, near Paris in France. Esmertec will put in place the appropriate organization, development environment and processes to integrate the team into Esmertec Group to design additional compelling software platforms and solutions.
