Multiband Accelerates Initial Portion Of WPCS Acquisition
Multiband Corporation (NASDAQ:MBND), a leading Home Service Provider (HSP) for DIRECTV and the nation's largest DIRECTV Master System Operator (MSO) for Multiple Dwelling Units (MDUs), today announced in conjunction with WPCS International Incorporated (NASDAQ: WPCS), that they have signed a non-binding letter of intent (LOI) whereby Multiband will purchase from WPCS the WPCS operation centers located in St. Louis, Missouri and Sarasota, Florida.
The consideration for the purchase will be two million dollars, of which seven hundred fifty thousand dollars will be disbursed from the one million dollar down payment previously put into escrow by Multiband and the balance of which will be paid for by cash on hand. The parties expect to sign a definitive agreement with regards to the purchase of these two operation centers by next week and transfer control by September 1, 2011. These two operation centers produced approximately thirteen million dollars in revenue during WPCS’s 2011 fiscal year ended April 30, 2011.
The LOI also includes provisions whereby Multiband is provided an exclusive period until February 1, 2012 to purchase the outstanding common stock of WPCS on terms consistent with those detailed in the parties’ original June 2011 letter of intent. In exchange for the aforementioned, Multiband has agreed that during the exclusivity timeframe, it will not sell any of the 709,271 common shares of WPCS it currently owns.
“Multiband is pleased that we were able to enter into an interim transaction with WPCS as part of an overall structure,” said James Mandel, Multiband CEO. “The two particular operation centers we are purchasing now will provide us with access to design and engineering talent and resources in the wireless area that we can employ to facilitate existing initiatives. Additionally, this process allows us to integrate the WPCS assets into Multiband in a controlled and measured manner similar to the actions successfully utilized with the purchase and integration of the DIRECTECH operating entity assets over the last two years. We find that this staged process accomplishes all goals for all parties in a fiscally sound and much more manageable procedure.”
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