Exco Technologies Limited announces acquisition of Automotive Leather Company Group (PTY) Limited

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[{"type":"text","content":"\n\n\nTORONTO, Dec. 19, 2013 /CNW/ - Exco Technologies Limited (TSX: XTC) today announced that it has signed a definitive agreement with\n Automotive Leather Company Group (PTY) Limited ('ALC'), a private\n company organized under the laws of South Africa, whereby a\n wholly-owned subsidiary of Exco would acquire all of the shares of ALC.\n\n\nPursuant to the terms of the definitive agreement, subject to receipt of\n applicable regulatory approvals and other customary closing conditions,\n the shareholders of ALC will receive approximately $17.2 million in\n cash and the issue from treasury of 973,895 Exco shares.  Exco's cash\n contribution will be funded primarily through the use of its operating\n credit facility which will be increased to accommodate the cash payment\n amount.\n\n\nThe closing is expected to occur in the second quarter of fiscal 2014. \n In 2011 and 2012 ALC had revenue of approximately $78 million and $86\n million respectively.  In 2013, ALC sales will be approximately $100\n million and is expected to grow over the next several years to\n approximately $140 million as a new seat cover program for the family\n of Mini models launch over the next 16 months.  The transaction is\n expected to be immediately accretive although rates of return will be\n impacted by expensing due diligence and closing costs and will also be\n impacted as ALC is integrated and the Mini business is launched.\n\n\nALC specializes in the manufacture and export of luxury leather interior\n trim components to the middle and luxury automotive sector. The primary\n customer is BMW and its tiers although other German OEMs and their\n tiers are also customers.\n\n\nALC's current business dates back to 1990.  In 2002 it acquired a large\n portion of the South African trim business of BMW.  Since then it has\n supplied quality leather seat covers and other interior trim components\n to BMW and other German OEMs and their tiers. After closing, several\n shareholders will continue to manage the ALC business and their\n significant shareholdings in Exco will ensure that their interests are\n aligned with those of Exco.\n\n\nIn addition to ALC's traditional production site in the Rosslyn\n Automotive Supply Park in South Africa, it has in 2011 established a\n state-of-the-art production site near Sofia, Bulgaria an...

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