Based on the closing price of ViryaNet shares on February 25, 2002, the transaction is valued at approximately $2.85 million. The Company expects that earnings in Q1, excluding one-time charges related to the transaction, will be $0.00, $0.01 less than previous guidance, and earnings on a full-year basis will be $0.09 to $0.10, $0.01 to $0.02 higher than previous guidance.
iMedeon is a privately-held provider of mobile workforce management applications to the utilities sector. ViryaNet, an application provider to the telecommunications, industrial automation, high-technology manufacturing, and retail markets, believes that the acquisition will accelerate its penetration of the utilities sector, strengthen its delivery teams, and result in a further strengthening of its best-in-class product offerings.
This acquisition will add iMedeon's customers, including utilities such as Arizona Public Service, JEA, and Lumbee River EMC, and several other large, well-known companies, such as Nextel Communications, to the growing ViryaNet client roster. The acquisition increases ViryaNet's customer base to approximately 60 clients.
"ViryaNet's strategy is to become the dominant best-in-class provider of Web-based and wireless workforce management solutions to companies in multiple industries, including the utilities sector, that provide service to their customers," stated Win Burke, president and CEO, ViryaNet. "This acquisition will allow ViryaNet to capitalize on iMedeon's utilities market presence, customer base, domain expertise, unequaled wireless capabilities, and powerful partnerships. Our goal is to provide service organizations in the utilities sector and other industries with applications that automate all service activities -- focusing on workforce management, supported by contract administration, spare parts logistics, and depot repair -- over the Web and wirelessly. Our applications are built not by generalists in enterprise software, but by people who understand and specialize in the intricate details of service delivery. We are committed to building the best workforce management and supporting applications for service delivery in the world."
iMedeon's former chairman and CEO, Larry Duckworth, observed that, "Present and future customers of the new ViryaNet will benefit in many ways from the combined capabilities. ViryaNet's philosophy of customer care, industry commitment, and product excellence is an extension of iMedeon's vision and values. We also believe that iMedeon's partnerships with GE and others will be enhanced by this union, due to the comprehensive, multi-component nature of the ViryaNet applications."
As a result of the acquisition, iMedeon has become a wholly-owned subsidiary of ViryaNet. The Company intends to maintain the iMedeon offices in Alpharetta, GA. iMedeon employees will report immediately into the respective ViryaNet functional groups. Prior to the acquisition, iMedeon had 27 people and ViryaNet headcount was approximately 92. After the combination of operations, ViryaNet headcount is expected to be approximately 105.
ViryaNet expects revenue for 2002 to increase $3-$4 million as a result of the iMedeon acquisition. The Company indicated that it expects earnings in Q1, excluding one-time charges, to be about $0.00, and earnings on a full-year basis in 2002 are expected to be $0.09 to $0.10.
