RICHMOND, B.C. — SmarTire Systems has signed a definitive agreement to sell its business and the related assets to Bendix Commercial Vehicle Systems LLC, North American affiliate of the Munich, Germany-based Knorr-Bremse Group.
The transaction, which was scheduled to close Dec. 10, will immediately incorporate the company’s assets to become a part of the electronics business unit of Bendix.
Proceeds from the sale closing will be held in escrow subject to SmarTire obtaining consent of its shareholders at a meeting to be held in March, 2009. SmarTire expects to apply all, or substantially all, of the proceeds from the sale against its debt obligations. Following the transaction, SmarTire will change its name to TTC Technology Inc.
"The past year has presented many challenges for SmarTire and our goal of growing the business to become self sufficient," said Dave Warkentin, president and CEO. "Market conditions created delays in the implementation of our products as well as new TPMS programs being pursued with key customers. The adverse affect that this caused on our revenues resulted in the continued requirement for debt financing, which became impossible to secure due to recent economic conditions as well as the company’s debt load. This transaction is the result of an exhaustive process that was employed to ensure that maximum value was received for the assets of the company."
