Engineering Power Systems Group, Inc.
March 23, 1999
To OTC Journal
Members:
There are
several news items to cover with you today. First,
our March Profile will be released sometime after
the close this Friday. We will re-release the profile
Tuesday of the following for those that don't receive
it over the weekend.
1st Net (OTC
BB: FNTT), our parent company, traded extremely well
last week hitting a high of $10.50 after starting
the week at $3, and traded over one million shares
last week. The stock closed at $5 today, providing
a reasonable entry level for those that feel they
might have missed a great opportunity. However, don't
ask us to make a short term price projection. This
stock could go anywhere.
Last but
not least, there was great news from our current profile,
Engineering Power Systems Limited (OTC BB: EGPDF).
While there was a major power failure in the markets
today, there was a major surge of activity in the
Power Generation business.
- In Brussels,
ABB and Alstom announced the merger of their power
generation businesses. The surviving company will
employ 54,000 people located in over 100 countries,
and generate about $11 billion in annual sales.
- GE (NYSE:
GE) announced an agreement to purchase the heavy
duty gas turbine business from Alstom.
- In San
Jose, CA, Calpine Corporation (NYSE: CPN) announced
the filing of a registration statement to sell 6
million shares of stock to the public at $31 per
share.
- Edison
International (NYSE: EIX) announced that it is acquiring
all the fossil fuel generating assets of Commonwealth
Edison.
- In Chicago,
Unicom Corporation (NYSE: UCM) announced the sale
of its six coal fired power generating plants to
Edison International for $4.8 billion.
All in all,
a pretty explosive day in the Power Generation industry,
with billions of dollars changing hands.
Our favorite
power generation company, Engineering Power Systems
Limited (OTC BB: EGPDF), announced the completion
of the acquisition of the remaining 49% of M&M Engineering,
its largest and now wholly owned subsidiary. In the
fiscal year ending June, 1998, M&M did nearly $30
million (CDN) in sales, and made net profits of $1.35
million (CDN) in after tax profits. The transaction
was funded with stock only, proving that the management
of M&M knows when to get the most bang for their buck.
With all
this activity in the Power Generation business, and
EGPDF continuing to make fundamental improvements,
it is just a matter of time before someone besides
OTC Journal recognizes the value of Engineering
Power.
Here is the
complete text of the news release for your review:
Tuesday March 23, 9:55 am Eastern Time
Company Press Release
SOURCE: Engineering Power Systems Group Inc.
EPS Acquires
Balance of Interest in M&M Engineering Limited
TORONTO,
March 23 /CNW-PRN/ - ENGINEERING POWER SYSTEMS LIMITED,
(``EPS'' or the Company) (CDN: EPSL) (NASD Bulletin
Board: EGPDF) (www.epsx.com) announces that it has
acquired the remaining 49% interest in the issued
capital of its subsidiary M&M Engineering Limited
(M&M), a Newfoundland, Canada corporation. The purchase
price of $3,050,000 will be satisfied by the issuance
of 1,694,000 units of the Company. Each unit consists
of one common share and one common share purchase
warrant of EPS. Each warrant, subject to shareholder
approval, will entitle the holder to purchase one
common share of EPS at a price of $2.50 for a period
of three years from the date of issuance.
M&M
incorporated in Newfoundland, Canada in February,
1968. M&M's business includes installation of production
equipment, industrial maintenance in support of
the resource industry's infrastructure projects,
including offshore plants, and fabrication and installation
of process piping and pressure vessels. In 1987
M&M established a wholly owned subsidiary, M&M Offshore
Limited to provide specialised welding capabilities
and servicing facilities to the Atlantic Canada
offshore oil industry and to manufacture oil tanks,
silos, stacks, penstocks and structural and miscellaneous
steel components for the Atlantic Canada market.
As the exclusive service contractor for ABB Vetco
Gray in eastern Canada, management of M&M believes
that M&M will realize substantial revenues for maintenance
services to the offshore industry over the next
twenty years. ABB Vetco Gray was awarded a multi-million
dollar contract with Hibernia Management and Development
Corporation for the supply of wellhead, christmas
trees and other subsea equipment for the production
phase of the project.
In December
1996, M&M became a co-founder of the Newfoundland
Service Alliance (NSA) alongside Siemans/Westinghouse,
Sea Systems and two other contractors to collaborate
on offshore maintenance contracts. NSA has been
successful securing various fabrication, electrical,
mechanical and instrumentation contracts for the
Hibernia production platform and expects to be similarly
active as the Atlantic Canada offshore development
expands.
For
the fiscal year ended June 30, 1998 M&M consolidated
reported CDN $28.8 million in revenue and $1.35
million in after tax profit. The principal contracts
performed by M&M during this period included work
on the Hibernia transhipment terminal, the North
Atlantic Oil Refinery and the Star Lake Hydro Project.
In the 6 month period ending December 31, 1998 M&M
consolidated grossed $14.6 million in revenues.
M&M
consolidated has worked on a contract basis with
over 500 local and specialized subcontractors and
tradesmen and can therefore select the people with
the precise skills, reputation and reliability required
on a M&M project. Throughout its 30 year history,
M&M has extensive experience in mechanical installation
of component and auxiliary systems for land based
power plants. As EPS develops its barge mounted
power projects in India, EPS will be relying on
the experience of M&M to assist in the engineering,
procurement and construction of EPS power barges.
EPS
is also pleased to announce that the Company has
completed a private placement and issued 891,667
units of the Company for total proceeds of $1,605,000.
Each unit consists of one common share and one common
share purchase warrant exercisable at $2.00 for
a period of three years. The common shares issued
pursuant to the private placement are subject to
a regulatory hold period. The proceeds from the
private placement have been applied to working capital.
Scott
Hargreaves, Chief Financial Officer of EPS stated,
``the combination of the private placement and the
expanded ownership in M&M increases the net book
value of EPS by over $3 million or an increase of
$0.25 per share. In the fiscal year ending June
1998, M&M reported after tax earnings of $1.35 million
but only 51% of these profits were consolidated
by EPS. M&M is on course to report another year
of profits for fiscal year ending June 1999. One
of the many advantages of the M&M acquisition is
that from now on, 100% of M&M's profits will accrue
to EPS.''
EPS
is a vertically integrated builder and owner of
independent power projects and contractor of infrastructure
projects. EPS is an Ontario corporation with four
subsidiaries. M&M Engineering Limited, of St. John's,
Newfoundland, a mechanical contracting and steel
fabrication company, ASI Holdings Limited, of Port
aux Basques, Newfoundland, a marine refurbishment
and fabrication company, and Merlin Engineering
AS., of Kristiansand, Norway, a design engineering
and contracting company, and EPS Oakwell Power Limited,
of New Delhi, India an independent power production
company with a 200 mega watt barge mounted power
project under development in Andhra Pradesh, India.
Number of shares issued: 12,112,437
Certain statements
contained herein constitute forward-looking statements.
Such statements include without limitation, statements
regarding business and financing plans, business trends
and future operating revenues and expenses. Although
the Company believes that the statements are reasonable,
it can give no assurance that such expectations will
prove to be correct. Forward looking statements are
typically identified by the words: believe, expect,
anticipate, intend, estimate and similar expressions,
or which by their nature refer to future events. The
Company cautions readers that any forward looking
statements made by the Company are not guarantees
of future performance, and that actual results may
differ materially from those in the forward-looking
statements as a result of various factors, including
but not limited to, the Company's ability to continue
its projected growth, or the Company's ability to
fully implement its business strategies.
SOURCE: Engineering
Power Systems Group Inc.
Disclaimer
The OTC Journal.com Newsletter is an independent
electronic publication committed to providing our
readers with factual information on selected publicly
traded companies. All companies are chosen on the
basis of certain financial analysis and other pertinent
criteria with a view toward maximizing the upside
potential for investors while minimizing the downside
risk, whenever possible. All statements and expressions
are the sole opinions of the editors and are subject
to change without notice. This profile is neither
an offer nor solicitation to buy or sell any securities
mentioned. This newsletter is owned by OTC Journal Management,
Inc, a wholly owned subsidiary of 1st Net Technologies,
Inc ("1st Net"). While we believe all sources of information
to be factual and reliable, in no way do we represent
or guarantee the accuracy thereof, nor the statements
made herein. The editor, members of the editor's family,
and/or entities with which they are affiliated, may
own stock in and have other financial dealings with
the companies who appear in the publication. To that
degree, this newsletter should not be regarded to
be an independent publication. 1st Net Technologies,
the parent company of OTC Journal Management, which owns OTC Journal.com,
has received the following compensation from Engineering
Power Systems Limited: 75,000 options with an exercise
price of $1.75. On the date of the release of this
profile, 1st Net Technologies has performed Web Site
Design Services and provided proprietary Internet
Related Technologies to Engineering Power Systems
Limited for fees totaling $43,750. These fees have
been applied to the exercise of 25,000 options of
Engineering Power stock. 1st Net may not exercise
the remaining options until June 1st, 1999, when 1st
Net has the right to exercise 25,000 options, and
October 1st, 1999, when 1st Net can exercise the remaining
25,000 options. 1st Net retains the right to sell
or buy shares of Engineering Power Systems Limited
at any time at its sole discretion. The OTC Journal.com
critiques may contain forward looking statements relating
to the expected capabilities of the companies mentioned
herein.
THE READER
SHOULD VERIFY ALL CLAIMS AND DO THEIR OWN DUE DILIGENCE
BEFORE INVESTING IN ANY SECURITIES MENTIONED. INVESTING
IN SECURITIES IS SPECULATIVE AND CARRIES A HIGH DEGREE
OF RISK. THE INFORMATION FOUND IN THIS PROFILE IS
PROTECTED BY THE COPYRIGHT LAWS OF THE UNITED STATES
AND MAY NOT BE COPIED, OR REPRODUCED IN ANY WAY WITHOUT
THE EXPRESSED, WRITTEN CONSENT OF THE EDITORS OF SUPERSTOCKPICK.com.
We encourage
our readers to use caution when investing and educate
themselves at the web sites ofÊ the Securities and
Exchange Commission ("SEC") at http://www.sec.gov
and/or the National Association of Securities Dealers
("NASD") at http://www.nasd.com.ÊÊ
We also strongly recommend that you read the SEC advisory
to investors concerning Internet Stock Fraud, which
can be found atÊ http://www.sec.gov/consumer/cyberfr.htm.Ê
Readers can review all public filings by companies
at the SEC's EDGAR page. The NASD has published information
on how to invest carefully at its web site.
