COPENHAGEN, Denmark, Dec. 1, 2000 (PRIMEZONE) -- Today GN Nettest acquired Brazilian AGC (Optosystems). The acquisition price amounts to USD 7 million in cash, of which USD 4 million is payable now and the remainder will be payable to the seller during the next three years, provided that a number of targets are met.
The acquisition is part of GN Nettest's strategy to strengthen the company's presence on selected large growth markets by establishing sales companies. AGC will be GN Nettest's 14th sales company and the first in South America, where AGC later will give access to increase focus from Brazil to other countries.
AGC was established in 1986 by Jonah Trunk, who will continue being responsible for sales in South America and leader of the company after the acquisition. For several years, AGC has reached good results as distributor for GN Nettest in Brazil, but it is estimated that GN Nettest may increase its market share on this growing market if AGC solely concentrates on GN Nettest's product portfolio and selected products from other suppliers which will support the sales of GN Nettest products.
The Brazilian telecommunications market was privatized in 1998, and national as well as international telecommunications operators are in the process of making considerable investments in the development of the telecommunications infrastructure, which has also created a growing market for test equipment with a value of up to USD 60 million. So far, GN Nettest's sales in Brazil have primarily consisted of equipment and systems for fiber optical tests, but the intense growth in the telecommunications network and the number of subscribers on both the fixed and mobile networks is also expected to generate increased demand for GN Nettest's network management systems Quest7 and QUESTFiber and for other equipment from Network Division.
AGC has 32 employees of whom 18 are employed in sales and technical management, including installation, fitting, and repair. It is the intention to increase the number of sales personnel and at the same time train the sales personnel to also master Quest7, QUESTFiber, and other products from Network Division.
In 1999, AGC recorded sales of USD 12 million, and this year is expected to reach sales of USD 14 million. The acquisition has an insignificant influence on GN Nettest's 2000 results.