McRae Industries, Inc. Announces the Sale of Its McRae Office Solutions, Inc. Subsidiary
10 September 2004 - 8:25AM
PR Newswire (US)
McRae Industries, Inc. Announces the Sale of Its McRae Office
Solutions, Inc. Subsidiary MOUNT GILEAD, N.C., Sept. 9
/PRNewswire-FirstCall/ -- McRae Industries, Inc. (Amex: MRIA; MRIB)
announced that it has entered into a definitive agreement under
which it has sold substantially all of the assets of its McRae
Office Solutions, Inc. subsidiary to Connected Office Products,
Inc. (COPI). COPI is a subsidiary of Toshiba America Business
Solutions, Inc. (TABS) which is headquartered in Irvine, California
and operates a network of wholly-owned subsidiaries involved in the
sales, service and distribution of office products. Under the terms
of the Asset Purchase Agreement, COPI has agreed to purchase the
assets of McRae Office Solutions for $11,000,000 subject to
adjustment based on the net book value of the acquired assets as of
August 28, 2004. In addition, COPI has agreed to offer employment
to all of the current employees and continue to operate the
business from the same facilities in Mount Gilead, North Carolina.
"McRae Office Solutions has been a vital part of McRae Industries
for over 20 years," said Gary McRae, President and CEO of McRae
Industries. "We are delighted and excited to have found a strategic
buyer like Toshiba, which will provide the necessary resources to
take McRae Office Solutions to the next level and continue the same
exceptional service and support that our customers have come to
enjoy." The company expects to use the proceeds from the sale to
expand and retool its military and western boot businesses, as well
as to provide necessary capital to support the company's bar code
business research and development efforts. Net revenues for McRae
Office Solutions amounted to $17.1 million, $22.5 million and $24.7
million for the nine months ended May 1, 2004 and fiscal years
ended August 2, 2003 and August 3, 2002, respectively. Earnings
(loss) from operations for these same periods totaled ($146,000),
$231,000 and $629,000, respectively. McRae Industries, Inc. was
founded in 1959 as a manufacturer and distributor of children's
shoes. Today, McRae Industries has grown into a widely diversified
company involved in manufacturing, sales and distribution of
military footwear, western and work boots; sales and distribution
of bar code reading and printing devices; and sales and servicing
of copiers and facsimile machines. The Company also operates other
smaller businesses. McRae Industries, Inc. has offices throughout
the United States. Its Corporate headquarters is located in Mount
Gilead, North Carolina. In addition to historical information, this
press release includes certain forward-looking statement as such
term is defined in Section 27A of the Securities Act and Section
21E of the Exchange Act. Important factors that could cause actual
results or events to differ materially from those projected,
estimated, assumed or anticipated in any such forward-looking
statements include: the effect of competitive products and pricing,
risks unique to selling goods to the Government (including
variation in the Government's requirements for our products and the
ability to terminate its contracts with vendors), loss of key
customers, acquisitions, supply interruptions, additional financing
requirements, loss of key management personnel, our ability to
successfully develop new products and services, our expectations
about future Government orders for military boots, and the effect
of general economic conditions in our markets. DATASOURCE: McRae
Industries, Inc. CONTACT: D. Gary McRae of McRae Industries, Inc.,
+1-910-439-6147 Web site: http://www.mcraeindustries.com/
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