CriticalControl Solutions Corp.
TSX : CCZ

CriticalControl Solutions Corp.

March 12, 2015 17:04 ET

CriticalControl Sells Eastern Canada Conversion Business

CALGARY, ALBERTA--(Marketwired - March 12, 2015) - CriticalControl Solutions Corp. ("CriticalControl" or the "Corporation") (TSX:CCZ) announced that it has sold a portion of its non-energy services business based in Quebec, Ontario and Manitoba (the "Divested Assets") for gross proceeds of $1 million under an asset sale. Under the terms of the sale, all accounts receivable, liabilities and other working capital associated with the business prior to the sale will be retained by CriticalControl.

"This divestiture provides management with the flexibility to focus the Corporation's resources in our core energy services business where our key intellectual property resides," said Alykhan Mamdani, President and CEO of CriticalControl. "Management anticipates to use the proceeds from this disposition together with the freed up working capital to bring to market our strategic initiatives and expand geographically in the United States as opportunities arise."

In a press release dated March 2, 2015, CriticalControl announced that it is reviewing strategic alternatives with respect to its non-energy services business, which comprised 33% of the Corporation's revenue in 2013. This business segment consists of three components : Eastern Canada Conversion (consisting of document imaging and data entry services in Quebec, Ontario and Winnipeg); Western Canada Conversion (consisting of document imaging, data entry and business process outsourcing services in Alberta); and the Equipment Business (consisting of selling imaging equipment, preventative maintenance contracts and third party document imaging software). CriticalControl has been evaluating strategic alternatives related to each of these distinct parts on an individual basis.

The Divested Assets are comprised of the Eastern Canada Conversion business, which represents approximately 25.0% of the Corporation's revenue from its non-energy services business in 2013 (8.4% of total revenue in 2013). CriticalControl continues to investigate strategic alternatives related to the two remaining parts of its non-energy services business and expects to conclude its process by the end of May 2015.

Forward Looking Statements

Although the Corporation is evaluating strategic alternatives for its remaining non-energy services business, there is no assurance that the process will result in a divestiture of any portion of the remaining business. Notwithstanding expectations of the review being completed by the end of May 2015, once further information is obtained, the Corporation may choose to terminate the process early or extend the process where appropriate.

Proceeds from the divestiture together with freed up working capital is expected to be used in strategic initiatives and geographic expansion. Expectations are subject to change as management monitors the progress of its strategic initiatives. There can be no assurance that geographic expansion opportunities will arise to invest the proceeds from this divestiture.

About CriticalControl

In a world of escalating globalization, with an increasingly transient workforce, enterprises have difficulty maintaining their knowledge and are forced to focus on their key market advantages to remain competitive. CriticalControl provides these enterprises with secure and cost-effective solutions for the completion of document and information intensive business processes through an integrated offering of software, outsourced services and optimized business processes.

Contact Information

  • CriticalControl Solutions Corp.
    Alykhan Mamdani
    President & CEO
    Tel (403) 705-7500