JSE-listed Control Instruments, with effect from 1 January this year, bought 51% of US company Tripmaster, a supplier of onboard computers to the North American trucking market.
Control Instruments CEO Richard Friedman says the purchase price was $3.5 million (R21.9 million at this morning`s exchange rate).
Although the effective date was the beginning of the year, the deal was subject to South African Reserve Bank approval, which Friedman says was granted on 9 March.
He adds the purchase agreement includes an option to buy the balance of Tripmaster over the next three years, at a price of between $1.5 million and $10 million, depending on the company`s performance.
Control Instruments is to use cash to pay for both the initial acquisition and the remaining 49%.
"Tripmaster`s experienced management team and its outstanding brand equity in the North American market are an excellent springboard for Control Instruments to enter the North American fleet management market," he adds.
Tripmaster, headquartered in Arlington, Texas, achieved turnover of $8.7 million for the year to end-December 2004, with an after-tax profit of $223 524.
It has patented technology with respect to state-line-crossing calculations, which are to be incorporated into Control Instruments` fleet management products.
Tripmaster says former majority owner and CEO Richard Geib, is to continue as president and CEO.
Tripmaster`s onboard computer products were originally developed by Rockwell International, later ArvinMeritor. Geib, who had been a Tripmaster reseller since 1983, and a group of investors bought the assets from Meritor Automotive in 1999.
Geib become the sole owner in 2004.
Friedman says the acquisition creates "huge opportunities" for Control Instruments in the world`s largest fleet management market.
The Control Instruments share was untraded at 600c this morning.
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