On Track Innovations Ltd.
OTI ENTERS EMERGING EUROPEAN COUNTRIES MARKET
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OTI ENTERS EMERGING EUROPEAN COUNTRIES MARKET
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OTI Completes Acquisition of ASEC S.A. of Poland
Order for Micropayments Application in Poland Received by OTI’s Subsidiary,
ASEC S.A.
Fort Lee, New Jersey – November 15, 2004 – On Track Innovations Ltd. (OTI)
(NASDAQ: OTIV; Prime Standard (Frankfurt): OT5), a global leader in
contactless microprocessor-based smart card solutions for homeland security,
micropayments, petroleum payments and other applications, announced today its
entry into the emerging European countries market with the completion of its
acquisition of ASEC S.A. In exchange for all of the outstanding shares of the
capital stock of ASEC, OTI will issue to Nextel S.A. OTI ordinary shares
having an aggregate market value of between $1.6 million and $1.95 million.
The exact amount will depend upon the level of EBITDA achieved by ASEC during
2004 and 2005. OTI has undertaken to register the shares it will issue to
Nextel S.A. under the U.S. Securities Act of 1933. The acquisition was
conditioned upon ASEC’s receiving an order to supply 1,000 units of
contactless reader solutions for micropayments.
The order, which has been received, is for a Polish mass transit system. OTI
is hopeful that it will be followed by introduction to other payment sectors
in the future. In this application, commuters will be able to load funds onto
their commuter cards using a contactless reader integrated into Verifone’s
Omni 3750 terminals located at one of the largest kiosk chains across Poland.
With this new system, customers will be able to pay for their mass transit
tickets and other small ticket-items. The value of this order exceeds
$500,000.
Poland, with a population of about 40 million, recently joined the European
Union and has a strong need to modernize and ramp-up to the Western European
standards, especially with respect to financial and payment systems. Today,
there are about 80,000 Point-of-Sale terminals and 7,200 ATM machines located
across the country, a small number compared to the size of the country and its
growing economy. Thus, OTI believes, there is a tremendous opportunity for
OTI, whose solution is well suited for stores, hypermarkets and other
commercial locations.
The acquisition of ASEC whose software and back office systems for mass
transit ticketing and payment solutions complement OTI’s product offering,
enables OTI to provide end-to-end solutions with local technical support and
maintain its focus on higher margin products in the growing European emerging
markets.
Oded Bashan, President & CEO of OTI said, “We firmly believe that the
acquisition of ASEC, a profitable company with higher margins and recurring
revenue businesses, will improve OTI’s long-term profitability. Our entry into
the European emerging countries market with its vast commercial potential, is
something we have been working on for a long while and is in line with our
global marketing strategy of providing complete solutions to the three
vertical markets of Payment, Petroleum and SmartID.”
Jerzy Fulara, ASEC senior executive commented, “Given our great experience in
working with OTI, we are excited about becoming part of this rapidly growing
enterprise. Together we look forward to great synergies and achievements
across the European emerging countries market.”
About OTI
Established in 1990, OTI (NASDAQ: OTIV, Prime Standard: OT5) designs, develops
and markets secure contactless microprocessor-based smart card technology to
address the needs of a wide variety of markets. Applications developed by OTI
include product solutions for petroleum payment systems, homeland security
solutions, electronic passports and IDs, micropayments, mass transit ticketing,
parking, loyalty programs and secure campuses. OTI has a global network of
regional offices to market and support its products. The company was awarded
the prestigious ESCAT Award for smart card innovation in both 1998 and 2000.
Major clients include: MasterCard International, Atmel, BP, Scheidt &
Bachmann, EDS, Repsol, and the Government of Israel. For more information on
OTI, visit http://www.otiglobal.com .
end of message, (c)DGAP 15.11.2004
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WKN: 924895; ISIN: IL0010834682; Index:
Listed: Geregelter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin-
Bremen, Düsseldorf, Hannover, München und Stuttgart
150720 Nov 04
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