Focus Enhancements Acquires HD, Media Storage Assets
January 29, 2004
Campbell, CA - FOCUS Enhancements will acquire the assets and assume certain liabilities of Visual Circuits Corporation (VCC), and has signed a letter of intent to acquire COMO Computer & Motion GmbH, the company has announced.
VCC, a leading manufacturer of networked digital video systems, is located in Minneapolis, MN. COMO, a developer of video content management and processing solutions, is based in Kiel, Germany.
The assets and assume certain liabilities of Visual Circuits Corporation (VCC) will be acquired for common stock worth approximately $8.9 million based upon yesterday’s closing price of $2.67. FOCUS Enhancements also signed a letter of intent to acquire COMO Computer & Motion GmbH for common stock worth approximately $1.8 million.
Visual Circuits
VCC’s networked media servers and devices enable users to manage, distribute and present standard and high-definition (HD) video and high-resolution graphics over terrestrial and satellite networks.
National retailers Wal-Mart and Best Buy use VCC solutions in thousands of locations to drive in-store video networks, delivering, storing and presenting content for programmed, live and interactive promotions, advertising and training.
VCC’s customers also include Exam Room Network, Telehealth, The American Museum of Natural History, Epcot Center and The Rock and Roll Hall of Fame.
COMO
COMO’s content storage and management products enable users to easily store and categorize video using metadata and to retrieve media from multiple sites over the Internet or a local network. The associated content management software completes a turnkey solution and provides unique features such as video thumbnails in MPEG4, editing within the system and extraction of single frames and segments.
The presence of an office in Germany will allow FOCUS Enhancements’ to better support its European distributors and customers.
COMO offers affordable media management products for sports, medical, education and other professional video applications that require interactive presentations, scheduled broadcasting, and most importantly, the storage and organization of large amounts of media content.
Brett Moyer, president and chief executive officer of FOCUS Enhancements, stated, “These complementary acquisitions expand our ability to provide a much wider range of the digital media workflow – from capture, conversion and creation to content management, storage and presentation. Our expanded product suite, including our Ultra Wideband (UWB) wireless initiative, is addressing market trends that demand tighter product integration, greater ease of use and higher value. The acquisitions also improve our ability to support and broaden the European market, as well as extend our customer base to include large private video network deployments in retail, healthcare and entertainment markets including leading Fortune 500 retailers such as Wal-Mart and Best Buy.”
“Including these acquisitions, we believe FOCUS Enhancements’ 2004 revenue will range between $23 and $26 million,” Moyer added. “As of this date, FOCUS Enhancements does not anticipate it will receive additional FS454 chip purchase orders from Microsoft, nor do we expect to ship to Microsoft after the first quarter of 2004. However, we will continue to market the FS454 to manufacturers seeking a high-quality, low-cost TV-out chip set solutions.”
Moyer continued, “These acquisitions will also bring experienced personnel to FOCUS Enhancements. I am pleased to announce David Parish, Visual Circuits’ chief executive officer, and Norman Schlomka, COMO’s managing director, will be joining FOCUS as EVP Business Development and VP European Operations, respectively. We are working closely with the teams to affect a smooth and seamless integration.” Both VCC and COMO are anticipated to remain in their current locations.
Parish stated, “We are very excited about joining FOCUS Enhancements. Gaining access to its broad sales channels will quickly bring our products to a much larger audience. Furthermore, applying FOCUS Enhancements’ UWB technology to the VCC product line will build upon our technical leadership and bring tremendous innovation to our customers.”
Schlomka stated, “We are very pleased COMO will soon be joining FOCUS Enhancements, as the combination creates a complete product suite from the FireStore Digital Hard Disk Recorder to our Media Management Server System to the Visual Circuits’ Playout Solutions. With our presence in Europe and FOCUS Enhancements’ extensive distribution in the United States and Asia, we anticipate that the combined company will become a significant supplier to the professional video market.”
Both acquisitions are subject to the approval of the respective shareholders of VCC and COMO. The VCC acquisition is expected to close by April 30, 2004 and will require the SEC’s approval of an S-4 registration statement for the FOCUS Enhancements shares being issued to VCC. FOCUS Enhancements anticipates VCC will subsequently issue the newly registered shares to its shareholders as it dissolves through a liquidating trust. The COMO acquisition is expected to close by March 31, 2004. Both acquisitions can be terminated under certain conditions and both allow for hold backs of certain amounts of the share consideration.
Management will discuss the acquisitions on its Fourth Quarter and Year-end Results Conference Call in early March.
For more information, visit
www.focusinfo.com
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