SmarTire agrees to sell operations
SmarTire Systems Inc. has signed a definitive agreement to sell its business and related assets to Bendix Commercial Vehicle Systems LLC.
The transaction will immediately incorporate SmarTire's assets to become part of the electronics business unit of Bendix, which is owned by the Knorr-Bremse Group of Germany.
Proceeds from the sale will be held in escrow subject to SmarTire gaining consent from its stockholders this coming March.
SmarTire intends to apply all, "or substantially all," of the proceeds from the sale against its debt obligations.
Following the transaction, SmarTire will change its name to TTC Technology Inc.
"The past year has presented many challenges for SmarTire and our goal of growing the business to become self-sufficient," says SmarTire CEO Dave Warkentin.
"Market conditions created delays in the implementation of our products as well as new tire pressure monitoring system programs being pursued with key customers.
"The adverse affect this caused on our revenues resulted in the continued requirement for debt financing, which became impossible to secure due to recent economic conditions, as well as the company's debt load."