MOSCOW, March 26, 2007 (PRIME NEWSWIRE) -- NUCON-RF, Inc. (Pink Sheets:NNRF) today announced the execution of letters of intent to acquire 25.5% of JSC Electroprivod and 25.5% of Velkont for the collective sum of $3,500,000 to $8,500,000. The final acquisition price for the two investments will be determined upon the completion of due diligence and will include the purchase of new equipment for Velkont. The foregoing acquisitions will be made together with management of ZAO ATOLL (ATOLL) who will purchase an equal share of JSC Electroprivod and Velkont.
Subject to finalization of ongoing due diligence investigations, NUCON-RF anticipates that it, along with management of ATOLL, will execute a definitive agreement with JSC Electroprivod and Velkont in the third quarter of 2007. To this end, NUCON-RF has retained a Moscow based auditing firm to audit the financial statements of each entity under U.S. GAAP. Collectively, NUCON-RF and ATOLL management will hold 51% of each of JSC Electroprivod and Velkont following the acquisitions.
Velkont is located in the city of Kirvo-Chepetsk, and JSC Electroprivod is located in the city of Kirov. NUCON-RF intends to purchase only the nuclear power plant equipment production and ecological services divisions of JSC Electroprivod. Upon completion of the acquisition, NUCON-RF intends to transfer the foregoing divisions to the Velkont facility and believes that this will result in higher levels of efficiency and may result in substantial cost savings. Presently, the annual collective revenue of JSC Electroprivod and Velkont is approximately $20,000,000.
Velkont is fully licensed by the Federal Ministry of Atomic Energy of the Russian Federation for the production of nuclear power plant equipment and holds other licenses for the production of equipment and microelectronics for the aeronautical and automotive industries.
Presently, Velkont has approximately 550,000 square feet of production facilities and employs 1,400 skilled workers. NUCON-RF anticipates that a restructuring of the current business model of Velkont would result in an increase in production capacity of up to 300%. Velkont has $14,000,000 in booked orders for 2007 and substantial orders for the period 2008-2010.
JSC Electroprivod is a scientific and technical complex and a leading designer of micro-electronic equipment in the Russia Federation and is licensed by the Federal Ministry of Nuclear Energy of the Russian Federation and other federal Ministries.
Over the last 50 years, JSC Electroprivod has designed and developed over 1,500 products used in the Russian and the CIS aeronautical and automotive industries. More than 200 of these items are currently being manufactured at factories in the cities of Kirov, Kirovo-Chepetsk, Kizlyar, Kursk, Saratov and Tyumen.
At present, JSC Electroprivod designs, manufactures and repairs the following items:
-- electromechanical systems
-- electro-automatic equipment for engine start-up and control
-- electric drives used in automated control and regulation systems
of nuclear power plants, oil and gas industry, technical processes
of non-ferrous metallurgy, and, in electric vehicles and in
electric tools
-- electric starters for ignition of gas turbines
-- DC and AC electric motors, stepping motors, brushless motors of
industrial voltages
-- gearless low-speed electric generators and electric motors
ABOUT NUCON-RF: NUCON-RF, a U.S. corporation with executive and operations offices in Washington, Berlin and Moscow, and provides products, technologies and engineering/design services for a range of environmental challenges. The Company owns manufacturing facilities and provides both equipment and services for nuclear waste solutions, as well as compliance, shielding, transport and storage requirements for nuclear power plants. NUCON-RF also owns and licenses proprietary leading edge technologies which augment the Company's market edge in manufacturing, design, engineering and services capabilities. The Company has a highly experienced, proven and high profile management team whose capabilities include extensive in-house expertise in all aspects of radiological protection and radiological waste management. NUCON-RF is currently involved in providing nuclear power plant equipment in Russia and China and intends to expand to India, European Union and North American markets in 2007-08. Current projects for 2007-2010 include multiple international nuclear waste remediation projects in northwestern Russia that are multilaterally funded by G-8 member countries for the decommissioning and disposal of nuclear powered naval vessels of the former Soviet Union. The Company is currently engaged, through its' 50% owned subsidiary, ATOLL, in further acquisitions in 2007-2008 which are intended to substantially increase its asset and revenue base.
SAFE HARBOR STATEMENT
Statements in this press release that are not historical facts are forward-looking statements, including statements regarding announcements of financial results, business potentiality and other prospective presentations by NUCON-RF, Inc. Such statements reflect management's current views, are based on certain assumptions and involve risks and uncertainties. Actual results, events, or performance may differ materially from the above forward-looking statements due to a number of important factors, and will be dependent upon a variety of factors, including, but not limited to, our ability to obtain additional financing that will allow us to continue our current and future operations and whether demand for our products in domestic and international markets will continue to expand. NUCON-RF undertakes no obligation to publicly update these forward-looking statements to reflect events or circumstances that occur after the date hereof or to reflect any change in NUCON-RF's expectations with regard to these forward-looking statements or the occurrence of unanticipated events.