James L. Mandel, CEO of Multiband, commented, "We continue to have a vested interest in the success of WPCS as a friendly shareholder and expect to work closely with them regarding any future items of mutual interest. The engineering and wireless intellectual properties that we acquired in September of 2011 have led to further opportunities to diversify our revenue stream. The main driver behind the initial acquisition was that we believed the cost to develop these capabilities would have far exceeded the $2 million purchase price besides the fact that this provided incremental benefit over and above our existing run rate.
Multiband completed the initial portion of its previously announced letter of intent (LOI) for the acquisition of the WPCS operation centers located in St. Louis, Missouri and Sarasota, Florida effective September 1, 2011. The acquired business was renamed Multiband Engineering and Wireless and is currently performing above recent pre-acquisition levels. The purchase price of this portion of the acquisition was closed for a total of $2.0 million, including $1.25 million in cash and $750,000 of the escrow amount of $1.0 million from the original LOI. The two locations have over 60 employees and Multiband began consolidating revenues from these operations effective September 1. The additional opportunities that have resulted from the acquisition of the engineering and wireless divisions include:
- Established Multiband's renewable energy division for wind and solar design and deployment solutions.
- A Wireless Broadband Internet offing with connection speeds ranging from 40 Megabits per second up to 120 Megabits per second. First beta site completed and is outperforming initial design parameters.