Mergers & Acquisitions

Mergers & Acquisitions

December 13, 2011

Wireless Age Spins Off Recently Acquired BPO Business

Wireless Age Communications announced its agreement to spin off the recently acquired OC Communications Group (OCCGI), a provider of business process outsourcing services based in Toronto.

The company will also sell its Toronto-based direct sales joint venture for the sale and finance of home energy products and a license for the brand and business practices to GameCorp.

Recently, Wireless Age Communications announced that the sale of OC Communications to Wireless Age is a key step in its growth strategy.

"We believe these businesses have tremendous growth potential, and are well positioned to be the platform in a larger consolidation of BPO and home energy finance businesses," said John G Simmonds, president and CEO of Wireless Age, in a statement.

"Strategically, WLSA is positioned to benefit as a significant shareholder of this business and as part of the transaction WLSA has also significantly reduced its liabilities," Simmonds added.

The strategic initiative is expected to provide WLSA the opportunity to expand its platform in home energy services. The company will be strengthening its core focus on growing the Enwise Homes Services and Enwise Building Science subsidiaries without the dilution of a consolidation strategy.

The OCCGI sale agreement involves receipt of one million shares of GameCorp, and transferring a vendor-take-back loan of $1.65 million secured by the common shares of OCCGI and owing to the previous shareholders of OCCGI.

The joint venture terms include sale of assets, including accounts receivable of approximately $500,000 and the transfer of third party Promissory Notes totaling $500,000. The third party Promissory Notes have an adjustment that provides for the amount transferred by WLSA to be reduced dollar-for-dollar if the related accounts receivable collected by GameCorp is less than $500,000.

Rajani Baburajan is a contributing editor for TMCnet. To read more of Rajani's articles, please visit her columnist page.

Edited by Carrie Schmelkin

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