another acquisition and I'm glad I'm still inthis mob is imo...

another acquisition and I'm glad I'm still in

this mob is imo definitely going places :)

Safety Medical Products Limited
25 Fenden Road, Salisbury Plain, South Australia
Australia, 5109
ACN 007 817 192
Phone: (08) 8285 5226 Fax: (08) 8285 3228
Email: [email protected] Website: www.safetymed.com.au
ASX Code: SFP
SafetyMed® is a registered trademark of Safety Medical Products Ltd
Monday 26th February 2007
SAFETYMED MAKES 2ND STRATEGIC ACQUISITION
Safety Medical Products Ltd (SafetyMed) is pleased to announce the signing of an option
agreement to purchase Bagot Press, an Adelaide based manufacturer and supplier of
specialised printing and general consumables to the pharmaceutical industry.
Founded in 1969 Bagot Press is a leader in this field with a Pharmacy based client list
encompassing South Australia, New South Wales , Queensland and Northern Territory, as
well as a broad array of other clients with general printing and consumables requirements.
The acquisition by SafetyMed is another strategic move towards delivering further growth
to the Company by broadening its’ products and services range as well as providing a
direct route into the retail national pharmaceutical market for the Company’s products.
Bagot Press is already supplying pharmacy consumable products to a large number of
pharmacies across most States and will be able to add the SafetyMed retail product range
to its list and integrate them very quickly and economically into its current distribution
channels.
The acquisition is also in keeping with Company’s product development strategy. This new
division will be empowered to commercialise the MediTag product in partnership with the
company’s other recently completed acquisition, ProControl Systems.
The MediTag in its final configuration will be in the form of a sticker type label, demanding
the input and expertise of an innovative and experienced manufacturer to prepare it for the
mass market.
Bagot Press satisfied this requirement perfectly and will be able to work closely with
ProControl Systems, to modify existing equipment or design and build any new equipment
required to produce the MediTag at an economically acceptable price and quantity.
As announced previously, all newly developed IP, that is applicable to both new products
as well as their manufacturing processes, will remain securely within the SafetyMed walls
in the form of Patents and/or Trade Secrets.
Significant synergies will be available within the grouping of all three companies and
looking forward to operating out of single central premises the sharing of overheads and
available technologies should result in expected and significant costs savings for all
entities.
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The acquisition is subject to due diligence and is for a price of $4 million, to be paid by way
of $2 million in cash and $2 million worth of SafetyMed shares based on the average daily
price for the five days preceding settlement, expected to be April 30th, 2007.
Bagot Press has been trading strongly with an annual turnover of $3 million+ resulting in a
net pretax profit of $600,000. It is expected that this latest acquisition when coupled with
the recent ProControl acquisition should result in an expected trading profit for SafetyMed
this calendar year and make the company cashflow positive from the point of completion.
This is before the imminent contribution by the Company’s flagship product the
SecureTouch Retractable Syringe care of sales via Exel.
The Company believes there are extremely strong growth opportunities within this sector
and fully intends to increase the Bagot business significantly in the very near future, as
well as seeking further acquisitions in the sector.
With the automated mass production trials of the Company’s SecureTouch Retractable
Safety Syringe to commence this month and production at the Exel Korean Factory
expected soon thereafter, the two recent value-accretive acquisitions and market entry of
the retail product range should position SafetyMed strongly with significant revenues to
come on-stream during 2007.
Safety Medical Products Ltd would also like to invite Shareholders, members of the public
and any other interested parties to the Company’s Open Day on Monday, March 5th 2007
at its’ Salisbury facility from 3pm to 7pm.
The main attraction will be the company’s brand new automated assembly machine that is
capable of assembling a minimum of 4000 units of SecureTouch Retractable Syringes per
hour resulting in a minimum of 33 million units per year.
The Machine’s Command Centre and extensive camera vision system monitors every
syringe from recognition and identification of initial components through the entire
assembly process to completion of the finished product. It will also strength test 100% of
the finished product before release as part of our strict Quality Assurance System.
This web linked state of the art equipment will also enable SMP to monitor production by
any of these machines placed anywhere in the world from our base in Adelaide. This will
ensure strict compliance for any future licensing, royalty or manufacturing arrangements
as well as providing instant access to and an ability to solve production problems wherever
they may occur.
The machine will be in full operation throughout the Open Day with the designers and
builders, ProControl Systems, on hand to discuss and demonstrate the machine’s
capabilities and answer any production related questions.
The day will provide a unique opportunity to view the Company’s technological
achievements ahead of the machine being sent to the Exel Syringe Manufacturing Facility
in Korea for full production.
The complete range of SafetyMed’s products including SecureTouch Retractable
Syringes, MediTags, Automatic Tape Dispensers, Disposable Thermometers, Freeze
Indicators and Surgical Masks will also be on display on the day.
The Board of Directors and Medical Advisory Committee will be present throughout the
day and available to discuss the company’s progress and achievements with shareholders
and visitors.
It is essential that anyone interested in attending the day must register their intention to
attend by emailing or in writing to the company, stating their name and those of any
companions as well as an approximate expected time of arrival.
Only pre-registered parties will be allowed entry.
FOR SECURITY REASONS IT ALSO MUST BE NOTED THAT UNDER NO
CIRCUMSTANCES WILL MOBILE PHONES OR ANY OTHER PHOTOGRAHIC
EQUIPMENT BE PERMITTED ONTO THE PREMISES ON THIS DAY. ANYONE FOUND
TO BE IN BREACH OF THIS WILL BE ASKED TO LEAVE THE PREMISES
IMMEDIATELY.
Thank you for your understanding and I look forward to seeing you at the Open Day.
Yours faithfully,
John Riemelmoser
Managing Director