MONTREAL, Canada, Oct. 13, 2004 (PRIMEZONE) -- Teleplus Enterprises, Inc. (OTCBB:TLPE):
-- Acquisition to increase revenues by 230% versus 2003 numbers
-- Acquisition to jump start U.S. deployment of MVNO to greater
than 700 points of distribution
-- Acquisition to drive revenues over USD$25M per annum
Teleplus Enterprises, Inc. (OTCBB:TLPE) announced today that it has signed a Letter of Intent (LOI) to acquire all of the assets, except the phone card business assets, of U.S.-based Mr. Prepaid. The terms of the transaction call for TelePlus to pay a combination of cash and stock compensation valued at up to approximately USD$3 million to the principals of Mr. Prepaid. TelePlus expects to close the transaction within 45 days.
The purchase price will include $1,000,000 worth of the Company's common stock and a cash compensation of USD$500,000. In addition, the transaction will also require TelePlus to reserve for issuance 3,000,000 shares of common stock with a current market value of approximately USD$1.5 million to be available for issuance to the Mr. Prepaid principals based on achieving certain performance goals over a five-year period.
Mr. Prepaid currently supplies a variety of wireless phones, related accessories and wireless and long distance vouchers to over 700 retail points of distribution located on the East Coast of the US. Mr. Prepaid recently launched its own Mobile Virtual Network program ("MVNO") under the UR MOBILE brand name. Mr. Prepaid's revenue run rate is currently in excess of USD$11.0 million per annum. The transaction also calls for Mr. Prepaid's management to remain on board post acquisition and for Mr. Prepaid's business to be operated as a separate subsidiary.
Post closing, TelePlus' 12-month revenue run rate, with the addition of the Mr. prepaid revenues, is expected to increase to over USD$25 million, representing a 230% increase over the Company's 2003 results. The Company's Revenues are expected to continue to increase as its subsidiaries execute on their respective business strategy. Post Closing, Mr. Prepaid is also expected to become TelePlus' primary distribution platform for its TelePlus Wireless branded MVNO product.
"We are delighted to have signed this LOI with Mr. Prepaid," stated TelePlus CEO Marius Silvasan. "The addition of Mr. Prepaid's business to our own, once the transaction closes, is strategic in nature as it not only significantly increases our revenues and positively impacts our earnings but provides us with a platform to jump start the deployment of our MVNO program. Furthermore it provides us with a solid foundation to our Company's future growth in the United States," added TelePlus CEO Marius Silvasan.
"The opportunity with TelePlus comes at the right time," stated Daniel Ely, CEO of Mr. Prepaid. "Mr. Prepaid is faced numerous opportunities and currently has limited resources as a privately held company to fully take advantage of all such opportunities. The marriage with TelePlus will provide Mr. Prepaid with the required resources to aggressively expand our business. The synergies among both companies, although difficult to clearly quantify at this time, are expected to favorably benefit the combined companies as we move forward," added Daniel Ely, CEO of Mr. Prepaid.
This transaction is subject to Teleplus satisfying its due diligence requirements.
About TelePlus
TelePlus Enterprises, Inc. ("TelePlus") through a subsidiary owns and operates 38 TelePlus branded stores in major shopping malls selling a variety of wireless and portable communication devices. The company's product line include wireless handsets and services from major Canadian carriers, international phones, satellites, home phones and other mobile electronic devices including an exclusive line of international GSM world phones. TelePlus through a US wholly owned subsidiary, TelePlus Wireless, Corp., operates a virtual wireless network selling its branded wireless products to distributors in select US cities.
About Mr. Prepaid
Mr. Prepaid Inc. is a leading provider of prepaid wireless products and related services through electronic transaction processing. The company supplies retail locations with Point of Sale terminals which allow retailers to manage inventory, reduce theft, and improve transaction reporting. With corporate offices in Baltimore, MD, Mr. Prepaid offers its retail locations a broad range of prepaid cellular phones and refill pins, including products for UR Mobile, a recently introduced private label brands. For further information, please visit www.mrprepaid.com
The statements which are not historical facts contained in this press release are forward-looking statements that involve certain risks and uncertainties, including but not limited to risks associated with the uncertainty of future financial results, additional financing requirements, development and acquisition of new product lines and services, government approval processes, the impact of competitive products or pricing a technological changes, the effect of economic conditions and other uncertainties, and the risk factors set forth from time to time in the Company's SEC reports, including but not limited to its annual report on Form 10-KSB; its quarterly reports on Forms 10-QSB; and any reports on Form 8-K. Teleplus Enterprises, Inc. takes no obligation to update or correct forward-looking statements.