Visonic Ltd. (LSE: VSC; TASE:VSC) has signed a non-binding term sheet with an international company for the sale of its location tracking systems business, Visonic Technologies. The company did not disclose the name of the buyer or the amount of the proposed sale. Visonic make electronic security systems and home management systems.
Visonic noted that in March, its board decided on the sale of Visonic Technologies because it was not a core business and its products targeted the institutional sector. It added that the board believes that the sale is the best option for the future development of both the company and Visonic Technologies.
The buyer will assume Visonic Technologies' loans and Visonic's bank guarantees for them. The buyer will also pay Visonic's owner's loans to Visonic Technologies in installments. Visonic will also continue to manufacture certain products for Visonic Technologies for 36 months from the closing.
Visonic expects to sign the final, binding agreement during the third quarter of 2008.
Visonic President and CEO Dr.Avigdor Shachrai said, "Our core business is security and home management products, predominantly aimed at the consumer and we have achieved our market leadership position by our commitment to the continuous development and launch of innovative and appealing products. We concluded that the divestment of Visonic Technologies would allow us to focus our efforts even more strongly on the residential market."
Visonic traded at ₤0.50 on the AIM today, giving a market cap of ₤20.2 million. The share fell 1.2% in morning trading on the TASE.
Published by Globes [online], Israel business news - www.globes-online.com - on June 16, 2008
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