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BIO-key Signs Agreement to Acquire Aether Mobile Government
Division
Combined Companies Will Be The Largest U.S. Provider Of Wireless Information
Solutions For Law Enforcement And Public Safety Markets
MINNEAPOLIS, Aug. 16 /PRNewswire-FirstCall/ -- BIO-key International, Inc.
(OTC:BKYI) (BULLETIN BOARD: BKYI) , a leader in finger-based biometric
identification and wireless public safety solutions, today announced that that
it has signed a definitive agreement to buy Aether's Mobile Government Division
(NASDAQ:AETH) for $10 million in cash. Completion of the sale is subject to
customary closing conditions.
"Aether's Mobile Government Division's (AMG) revenues based on the last two
quarters performance have an annualized run rate of approximately $19 million,
making it the market leader of wireless data services in the United States,"
said Tom Colatosti, BIO-key's Chairman. "The market and technology fit between
BIO-key and Aether is extraordinary -- we could not imagine a better match
between any two companies. We are thrilled with the opportunity to service
their more than 2500 loyal customers and work with them to continue to help
them cost effectively meet their security needs with new wireless and biometric
applications."
AMG solutions are currently deployed in state and local police, fire and rescue
and emergency medical services organizations and are fully integrated into 47
different state information databases, as well as local and federal databases.
AMG focuses its products in law enforcement areas around mobile data collection
and reporting, cross agency data sharing on federal, state and local levels.
The estimated potential includes nearly one million officers, supported by
hundreds of thousands of vehicles across 18,000 agencies in the United States
alone. Additionally the market opportunity for fire departments and EMS
services is approximately 31,000 agencies and 75,000 vehicles.
BIO-key's strategic partnerships with HP, Oracle, ChoicePoint, AutoDesk and
Netegrity powerfully extend the market reach of the combined companies.
Included in the acquisition is net working capital of $4.5 million and the
assumption of $10.75 million of certain customer performance guarantees backed
by letters of credits and performance bonds. BIO-key believes all these
guarantees can be replaced with less than one million dollars of cash from the
company. The transaction will be financed with the company's existing cash
resources and new debt.
Mike DePasquale, BIO-key CEO, added, "AMG has a great tradition of innovation
and excellence, with roots from Cerulean and Sunpro both industry leaders,
respectively, in law enforcement and fire services markets. We believe we can
achieve significant short and long term growth from the base of this combined
$25-$30 million annualized run-rate business because of the synergies we have
combining our existing strategic partnerships, our combined professional and
talented employees and the huge available market for security and biometrics
products and services. With the acquisition of AMG, we have the opportunity to
more cost effectively and creatively develop technology and products and more
effectively integrate and deploy our sales and marketing resources."
In a joint statement, Colatosti and DePasquale said that they believe the
acquisition will be accretive to revenues and earnings beginning in the fourth
quarter of 2004. Further, they added their belief that the combined company
would be cash flow positive one quarter after the first full quarter following
the closing.
About BIO-key
BIO-key develops and delivers advanced identification solutions and information
services to law enforcement departments, public safety agencies, governments
and private sector customers. BIO-key's mobile wireless technology provides
first responders with critical, reliable real time data and images from local,
state and national databases. BIO-key's high performance, scalable, cost
effective and easy to deploy biometric finger identification technology
accurately identifies and authenticates users of wireless and enterprise data
to improve security, convenience and privacy as well as reducing identity
theft. (http://www.bio-key.com/)
About Aether Systems
Aether Systems provides mobile and wireless data services to businesses in the
transportation industry and to government agencies and departments through its
two operating units, Transportation and Mobile Government. Aether has agreed to
sell both of these operations and implement a new business strategy in which it
will focus on building and managing a leveraged portfolio of residential
mortgage-backed securities. (http://www.aethersystems.com/)
BIO-key Safe Harbor Statement
This news release contains forward-looking statements that are subject to
certain risks and uncertainties that may cause actual results to differ
materially from those projected on the basis of these statements. The words
"estimate," "project," "intends," "expects," "believes" and similar expressions
are intended to identify forward-looking statements. Such forward- looking
statements are made based on management's beliefs, as well as assumptions made
by, and information currently available to, management pursuant to the
"safe-harbor" provisions of the Private Securities Litigation Reform Act of
1995. For a more complete description of these and other risk factors that may
affect the future performance of BIO-key International, see "Risk Factors" in
the Company's Annual Report on Form 10-KSB and its other filings with the
Securities and Exchange Commission. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as of the date
made. The Company also undertakes no obligation to disclose any revision to
these forward-looking statements to reflect events or circumstances after the
date made or to reflect the occurrence of unanticipated events.
For more information contact:
Albert Maruggi
612-325-8126
DATASOURCE: BIO-key International, Inc.
CONTACT: Albert Maruggi for BIO-key International, Inc., +1-612-325-8126
or
Web site: http://www.bio-key.com/
http://www.aethersystems.com/