VICTORIA, BRITISH COLUMBIA, CANADA (August 18, 2009) Carmanah Technologies Corporation (TSX: CMH) is pleased to announce that the Company and Dr. David Green have today closed on an agreement whereby Dr. Green, through his holding company, has purchased Carmanah's LED edge-lit signs business, Carmanah Signs Inc. ("CSI"). This transaction is aligned with Carmanah's business strategy to focus on strategic solar lighting and technology markets. As part of the transaction, Dr. Green has resigned as a member of the Carmanah Board of Directors in order to pursue this opportunity.
Under the agreement, Dr. Green, through an incorporated company controlled by him, will pay a combined total of approximately $2M for the shares of CSI and for repayment of CSI's inter-company debt to Carmanah Technologies Corporation. The deal includes a combination of cash payments and a common share buy-back by Carmanah of approximately 1 million of the Company's shares owned by Dr. Green. These common shares will be returned to Treasury.
Carmanah has been pursuing the sale of CSI for several months independently as well as seeking the services of an independent broker with no other acceptable offers being presented. The offer presented by Dr. Green met Carmanah's objective of receiving, at a minimum, net book value for the business as well as provided attractive payment terms that included re-payment of the inter-company debt, short settlement dates and rapid closure of the deal.
Following the transaction, Dr. Green will maintain an equity position in Carmanah, representing approximately 3% of the total common shares outstanding.
Dr. Green founded Carmanah in 1995, becoming Chairman when the Company went public in 2000. He resigned as Chairman in May, 2009, but stayed on the Board to assist the new Chairman with the transition into his new role.
According to Dr. Green, he looks forward to retiring from the Board to pursue this private business venture, confident that Carmanah's strategic growth plan is in capable hands. "Both the management team and the Board of Carmanah are now highly organized and focused on achieving a single goal: dominance in the solar lighting business. Ted Lattimore, the new CEO, has completed a restructuring that has refocused Carmanah on its core strengths, developed a network of partners, and articulated a strategic plan that has the consensus of all of the management team." Dave concludes, "I am retiring from the Carmanah Board with a sense of pride that my succession plan is complete, and I look forward to returning to what I do best: developing an earlier stage company."
Carmanah CEO Ted Lattimore noted that the sale of CSI is positive for all stakeholders. "The recent record purchase order for lottery signs by CSI demonstrates the continued opportunity for the signage business. Yet the business requires focus and capital investment that Carmanah Technologies Corp is not prepared to make as a result of our concentration on the strategic solar lighting and power areas of our business. New life can be injected into CSI under Dr. Green's guidance, and the reward can be even greater growth."
For more information, visit www.carmanah.com, or telephone 1.877.722.8877 (toll free in US and Canada).
About Carmanah Technologies Corporation
As one of the most trusted names in solar technology, Carmanah has earned a reputation for delivering strong and effective products for industrial applications worldwide. Industry proven to perform reliably in some of the world's harshest environments, Carmanah solar LED lights and solar power systems provide a durable, dependable and cost effective energy alternative. Carmanah is a publicly traded company, with common shares listed on the Toronto Stock Exchange under the symbol "CMH". For more information, visit www.carmanah.com.
Carmanah Technologies Corporation
Chief Financial Officer
For further information, please contact:
Investor Relations: Roland Sartorius
Public Relations: David Davies
Forward Looking Statements
This release may contain forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as "expects," "plans," "estimates," "intends," "believes," "could," "might," "will" or variations of such words and phrases. Forward-looking statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of Carmanah to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. These statements are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties which are described under the caption "Note Regarding Forward-looking Statements" and "Key Information - Risk Factors" and elsewhere in Carmanah's Annual Report for the fiscal year ended December 31, 2008, as filed on SEDAR at www.sedar.com. The risk factors identified in Carmanah's Annual Report are not intended to represent a complete list of factors that could affect Carmanah. Accordingly, readers should not place undue reliance on forward-looking statements. Carmanah does not assume any obligation to update the forward-looking information contained in this press release.