18 January 2005
Provenco Group expands Symbol distributorship into Australia
Provenco Group Limited (NZSX:PVO) today announced the planned acquisition of Javelin Systems (Asia Pacific) Pty Limited,
a Sydney based company. Provenco’s New Zealand subsidiary, Transtech Distributors Limited announced that it would
appoint Javelin as its Australian distributor of Symbol Technologies Inc. (NYSE:SBL) range of products.
Transtech has Australasian distribution rights for Symbol. Symbol is a world leader of mobile data management systems
and services. Symbol's scanning technology is used in New Zealand by a number of large retail and warehousing operators.
“Retail and transaction technology distribution is a core business of the Provenco Group. The acquisition of Transtech
Distributors in September 2003 expanded this capability considerably. Now we intend to expand this capability into
Australia through the proven technology distribution competency of Javelin,” said David Ritchie, CEO of Provenco Group.
“Javelin is a very good fit with our existing businesses. It allows us to improve our product offering, and it enables
us to grow into the Australian market.”
Symbol managing director Kurt Hansen said from Melbourne “the expansion of Transtech’s distribution business into the
Australian market via the acquisition of Javelin by Provenco is a very exciting development for Symbol. We have been
looking to expand our market share within Australia so the experience offered by Javelin and Transtech are the ideal
vehicle for us”.
Javelin managing director, Matt Maley will continue to manage the Australian business.
“The purchase of Javelin by the Provenco Group and its ability to bring the Symbol distributorship to Australia adds a
strong platform for accelerated growth to our core business of touch screen technology solutions and portable (RF) radio
frequency solutions. I am impressed by the strengths of Provenco and look forward to developing Javelin as part of the
Provenco Group”, said Javelin’s Matt Maley.
Terms of the acquisition
The purchase price for this acquisition is made up of two components: (i) a base price of approximately A$3.4 million to
be paid on settlement; and (ii) future payments of up to A$4 million, to be made over the next four years. This
acquisition is conditional on completion of due diligence.
The base price itself is made up of a cash payment of approximately A$2 million, together with the issue of Provenco
Group shares for A$1.4 million at 75 cents each. These shares will be subject to transfer restrictions for a two year
period after settlement and underwritten at 75 cents for this period. The future payments for the deferred settlement
will be paid in cash at the completion of each financial year for the four financial years following settlement, with a
cap on total future payments of A$4 million. Payment of the deferred settlement will be subject to the financial
performance of Javelin over the four year period.
Provenco Group does not need to seek shareholder approval for this transaction. The date for satisfaction of the due
diligence condition (unless extended) is 27 January 2005, with settlement scheduled for 31 January 2005. If declared
unconditional, the transaction once settled, will take economic effect from 1 January 2005.
Earnings expectations
The Board of Provenco Group is currently reviewing its earnings expectations for the second half of the 2005 financial
year which is very dependant on the timing of large international contracts. It anticipates being in a position to make
a further market announcement next week following the next Board meeting.
The Board has previously advised the market that the operating profit for the first half of the current financial year
is expected to be in excess of $4 million, and the company is confident that the early position of the results for the
six months ended 31 December 2004 is consistent with the previous announcements.
ENDS