Shareholders in Empire Beer could soon find themselves the owners of car park technology company Meter Eye after Empire announced plans to acquire the New Zealand-based company for an undisclosed amount.
Shareholders in Empire Beer could soon find themselves the owners of car park technology company Meter Eye after Empire announced plans to acquire the New Zealand-based company for an undisclosed amount.
West Perth-based Empire has will execute a Heads of Agreement to acquire all of Meter Eye.
Meter Eye provides a suite of innovative and intelligent car parking technologies to car park owners, operators and local council and authorities in Australia, New Zealand, Singapore and the UK.
It controls 10,000 cars parking spaces globally and enjoys an exclusive arrangement with Town and City Parking to provide TCP with car parking technologies.
Under the deal, Empire Beer has agreed to acquire 100 per cent of the issued capital of Meter Eye in exchange for the issue of 97 million fully paid ordinary shares in Empire Beer on a pre-consolidated basis.
Empire Beer’s shares are worth 21 cents each, which would value the deal at more than $20 million.
However, the company’s chairman Chris Morris said the value of the acquisition was undisclosed at this stage.
Two-years ago the boutique brewer announced it was reviewing its strategic direction, selling out off The Royal in East Perth and the Colonial Brewing Co in Margaret River.
See company statement below:
Empire Beer Group (Empire or Company) is pleased to announce that it has entered into a Heads of Agreement to acquire 100% of the issued capital in Meter Eye Limited (MEL).
About Meter Eye Limited
Meter Eye Limited (MEL) is a New Zealand based company that provides a suite of innovative and intelligent car parking technologies to car park owners, operators and local councils and authorities in Australia, New Zealand, Singapore and the UK.
MEL’s products utilise advanced wireless technology allowing speedy installation, low maintenance and minimal disruption to their client’s parking infrastructure.
Globally, over 10,000 parking spaces are currently under MEL’s control. In Australia, MEL’s products have been installed into venues such as the Optus Centre in Sydney and Brisbane International Airport, as well as local councils including the Towns of Subiaco, Claremont and Cottesloe in Perth.
Meter Eye Limited and Town and City Parking (UK)
MEL enjoys an exclusive arrangement with Town and City Parking (UK) (TCP) to provide TCP with car parking technologies.
Formed in 1993, TCP is one of the largest car park operators in the UK and operates over 1,100 car parks. It is the market leader in retail car park management with clients such as ASDA (UK subsidiary of Walmart), Somerfield, Sainsburys, Matalan, Morrisons, Iceland, Tesco and the NHS.
More information concerning TCP can be found at www.townandcityparking.co.uk
Revenue Model
MEL’s revenue is derived from several sources including:
Outright Product Sale
Revenue is generated from the sale of car parking technology products outright to end-users such as local councils.
In addition to the one-off purchase fee, generally a licence style fee is charged for ongoing access to the RepNET software.
Parking infringement Revenue
In the UK, TCP and MEL have agreed to share ongoing parking infringement revenue at TCP’s parking sites where ME products are installed for the life of the MEL products.
The combination of MEL’s in-ground sensors and automatic number plate recognition camera systems with the RepNET software is highly effective at improving parking infringement enforcement and efficiency, and assisting in ensuring car park turnover. By providing reliable real-time information via wireless media, parking attendants
using Meter Eye technology are able to efficiently infringe parking overstays.
A monthly licensing fee is also paid for access to the RepNET software.
MEL and TCP are working closely with TCP’s clients to roll‐lout the installation of MEL products across suitable TCP sites. Currently, TCP has installed MEL products into 50 of its car park sites for ASDA and Sainsburys.
TCP estimates that it operates approximately 600 car parks which would be suitable for the installation of MEL products on an infringement revenue share basis. The combination of EEE and MEL will provide MEL with the capital required to rapidly increase production in order to meet expected demand from TCP and to roll‐out its
products across the UK, and elsewhere.
Highlighting the extent of the relationship between TCP and MEL, upon completion of the Transaction, the
Managing Director of TCP, Mr Bernie Dickson, has agreed to join the Board of EEE as a non-executive director.
Meter Eye Products
MEL’s principal products are:
SmartEnforce: Programmable vehicle detection and monitoring in‐ground sensors, improving infringement enforcement efficiency.
SmartPlate: Highly accurate infra‐red automatic number plate recognition camera systems. Both fixed and mobile camera technology has been developed.
SmartCount: Wireless car counting device and technology.
SmartGuide: Wireless sensors provide guidance within car parks, improving traffic flow and car park turnover.
RepNET: Sophisticated web based software which provides car parking asset owners and operators with a high level of real‐time analysis concerning the use of their parking infrastructure. RepNet processes and analyses data collected by MEL’s products. RepNET is completely compatible and can be integrated with all of MEL’s parking products.
Overall, MEL’s products provide car park operators and owners with the ability to analyse and monitor the use of their assets, increase efficiency in terms of both traffic flow and enforcement and generally delivering a clear picture of their asset’s utilisation. This allows asset owners and management to make informed decisions concerning upgrade or modification to their infrastructure.
Transaction
Under the Heads of Agreement, EEE has agreed to acquire 100% of the issued capital of MEL in exchange for the issue of 97 million fully paid ordinary shares in EEE on a pre‐consolidated basis (Transaction), which shall be escrowed for a period of 12 months from the date of issue in accordance with ASX Listing Rules.
The Heads of Agreement is subject to customary conditions precedent, including due diligence by both MEL and EEE on each other. Following successful completion of due diligence, EEE and MEL have agreed to enter into a formal, binding
sale and purchase agreement which shall more fully detail the terms and conditions of the Transaction.
EEE and MEL are working towards finalising due diligence by the end of November, 2010, following which a full Transaction update and timetable shall be provided. At that time, the Company will convene a general meeting of its shareholders to seek all necessary approvals for the Transaction.
Further details of MEL and the Transaction will be set out in the associated Notice of Meeting dispatched to shareholders.
Working Capital Loan
Upon satisfactory due diligence being completed, EEE shall enter into a short term loan to MEL for up to $500,000. The proceeds of the loan shall be applied by MEL towards working capital and business development. The loan shall be repayable in a single amount amount on 30 June 2011, and will attract 12% per annum interest payable monthly, which shall capitalise.
Transaction Process
Should the Transaction proceed, the process will involve:
Recompliance with Chapters 1 and 2 of the ASX Listing Rules
As a result of changing the nature of its activities, the Company will be required to re-comply with Chapters 1 and 2 of the ASX Listing Rules. This involves obtaining shareholder approval for the Transaction in general meeting and also meeting the new listing requirements as if the Company were undergoing a new initial public offering.
Prospectus Capital Raising
Shareholder approval shall also be sought for a capital raising of between $500,000 and $1 million pursuant to a full form prospectus to be issued by the Company.
Board changes
On completion of the Transaction, several board changes shall occur to reflect the new direction of the Company. Board appointments will include Mr Paul Collins as Managing Director, Mr Roland Rogers as Technical Director and Mr Bernie Dickson, current Managing Director of TCP, as non-executive director.
Mr Chris Morris shall remain as Chairman of the Company.
Name change
The Company shall seek shareholder approval to change its name to reflect the business of MEL, subject to successful completion of the Transaction.
Attached to this announcement is a presentation which provides background on MEL and its products. Further information on MEL can also be found at: www.metereye.com
The board view the opportunity with Meter Eye Limited as a very exciting one. We look forward to providing updates to shareholders in respect of the Transaction in due course.
