MONTREAL, April 14, 2005 (PRIMEZONE) -- TelePlus Enterprises, Inc. (OTCBB:TLPE) (http://www.teleplus.ca), a vertically integrated provider of wireless and landline communications products and services across North America, is pleased to announce today that it has signed a Definitive Agreement (SPA) for the acquisition of 100% of the shares of Canada Reconnect, Canada's largest reseller of landline, long distance and Internet prepaid services.
Following the closing of the transaction, Canada Reconnect will be rolled into TelePlus Connect Corp. ("TelePlus Connect") thereby bringing TelePlus Connect's annual revenues to $7.9M and earnings (before taxes) to $1.3M servicing over 9,500 users.
STRATEGIC ACQUISITIONS PUTTING TELEPLUS AHEAD OF SCHEDULE
In the last 3 months, TelePlus has announced 3 strategic acquisitions designed to leap frog its business plan by 18 months. Freedom, Telizon and Canada Reconnect are expected to increase the Company's run rate by $20M and contribute in excess of $3M to earnings (before taxes). TelePlus closed its acquisition of Freedom on April 1st, 2005. The Company intends to close its acquisition of Canada Reconnect by July 1st, 2005 and intends to close its acquisition of Telizon, subject to obtaining financing, within 150 days. Upon closing, these transactions will be accretive to the Company's earnings per share.
Canada Reconnect currently provides local, long distance and Internet prepaid services to over 6,000 residential users across Canada. The transaction calls for TelePlus to pay a combination of cash and stock valued at $3.0M to the shareholders of Canada Reconnect in exchange for 100% of Canada Reconnect's shares.
"We are delighted to have signed a definitive agreement with Canada Reconnect," stated TelePlus CEO Marius Silvasan. "The acquisition of Canada Reconnect falls right in line with our business model and fits perfectly within TelePlus Connect's strategy. The acquisition of Canada Reconnect, once completed, will increase our revenue run rate to $23M and immediately contribute over $1.0M to our earnings (before taxes)," added Silvasan.
"We are excited to join the TelePlus family and fully anticipate our customers to continue receiving the highest level of service post acquisition," said Canada Reconnect President, Jon Peters. "We believe that our company's competitiveness will greatly improve as part of this transaction," added Peters.
In addressing the current stock price, Silvasan mentioned that, "There has been no change in the company's business developments that would support such a decline in the stock price. In fact we continue to strengthen the fundamentals of our business by adding $7.9M in revenue and $1.3M to earnings (before taxes) in the last 60 days alone and this without factoring the effects of the Telizon acquisition. These revenues and earnings will start impacting our P/L and balance sheet results starting in the second and third quarter of this year. In addition, we have executed our business plan ahead of schedule. The current price of our stock, significantly undervalued, only adds to our determination to continue the successful execution of our business plan," added Silvasan.
(1USD = 1.21CDN)
This press release is available on the company's official on-line investor relations site for investor commentary, feedback and questions. Investors are asked to visit http://www.agoracom.com and view the TelePlus Investor Relations Hub. Alternatively, investors are asked to e-mail all questions and correspondence to TLPE@agoracom.com where they can also request addition to the TelePlus investor e-mail list to receive all future press releases and updates directly.
About TelePlus http://www.teleplus.ca
TelePlus Enterprises, Inc. ("TelePlus") is a vertically integrated provider of wireless and landline products and services across North America. The Company's retail division -- TelePlus Retail Services, Inc. -- owns and operates a national chain of TelePlus branded stores in major shopping malls, selling a comprehensive line of wireless and portable communication devices. TelePlus Wireless, Corp. operates a virtual wireless network selling cellular network access to distributors in the United States. TelePlus Connect, Corp. is a reseller of landline and long distance services including Internet services.
About Canada Reconnect http://www.canadareconnect.com
Canada Reconnect, headquartered in Vancouver, Canada, is Canada's largest reseller of landline, long distance and Internet prepaid services to over 6,000 residential users across Canada.
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.