SOURCE: GREM USA

June 06, 2008 12:57 ET

GREM USA Commences Introductory Merger Talks With Top-Tier Guitar Manufacturer

FORT WAYNE, IN--(Marketwire - June 6, 2008) - GREM USA (OTCBB: GRMU) ("GREM," "the Company"), an emerging leader in the design and manufacturing of custom hand-crafted and electric guitars, today announced that the Company has commenced introductory merger talks with a nationally-recognized top-tier guitar manufacturer ("the Manufacturer").

The Manufacturer, who will be disclosed at a later date upon formal agreement of a letter of intent, is widely recognized as a leading producer of guitars throughout the United States and worldwide. The Manufacturer has existing profitable revenues in the tens of millions of dollars, complete and audited financial statements, and is believed to meet the requirements for listing on NASDAQ National Market.

The purpose of the merger would be to afford the Manufacturer the acquisition of a complementary business vehicle to which it may use to access public markets and expand its shareholder base. The benefits of undertaking this transaction with GREM specifically include its existing fully reporting status, its Fort Wayne, Indiana production facility (which could produce significantly more yield with the assistance of the Manufacturer), significant tax advantages to the Manufacturer, and the strong brand recognition of GREM guitars in the high-end market. GREM would intend to continue producing guitars in Fort Wayne, Indiana and would inherit thousands of additional distribution channels for its custom guitars. It is anticipated that the Manufacturer would absorb GREM liabilities as part of the merger terms. Although GREM is envisioned to be the surviving entity, current GREM officers and directors would be replaced by officers and directors of the Manufacturer, resulting in a complete change of control of the Company.

The Company wishes to emphasize that the process is in its initial stages and may take many months to complete, if at all. Considering such, management believes the impact of the proposed transaction to be extremely beneficial to common shareholders. A completed agreement would offer the opportunity for our shareholders to become a part of a mature, profitable company expected to be listed on a major national exchange. Although a share consolidation would be necessary, it is the belief of GREM management that the Manufacturer possesses strong fundamentals and would have little difficulty attracting investment interest into the new entity and maintaining a market capitalization necessary for continued listing on the NASDAQ.

President of GREM USA, Edward Miers, commented, "We're excited about the beginning of this process, and believe it could be a historic transaction in the US markets. Everyway we've looked at this, it makes a lot of sense. Given our current market capitalization of fewer than 500 thousand dollars, we think the merger process with a Manufacturer of this magnitude would add substantial value to our shareholders. If we are able to consummate this process, it would effectively result in GREM shareholders, who may have acquired our shares while we were valued at a couple hundred thousand dollars... a million dollars... or even several million dollars, to own a near-proportionate interest in a Manufacturer that could easily be expected to garner capitalizations exponentially higher than levels GREM has ever achieved. We believe this transaction would result in all shareholders experiencing a considerable appreciation in the value of their holdings, and that's why we're going to work diligently to make this transaction a reality."

Although GREM management believes this proposed merger is achievable, investors are cautioned that there is no guarantee that the described merger will take place, and are also apprised that it would further require a legal and regulatory process of an indeterminate timeframe. Shareholders are encouraged to carefully read the provisions at the bottom of this release concerning 'forward-looking statements.' GREM will release announcements regarding the proposed merger as they become available.

About GREM USA

GREM USA is a publicly traded company focusing on design and manufacturing of custom hand-crafted and electric guitars. For more information, visit our website at http://gremusa.com/.

This press release contains certain "forward-looking" statements as defined in the United States Private Securities Litigation Reform Act of 1995 that involve a number of risks and uncertainties. Statements which are not historical facts are forward-looking public statements concerning its expected future operations, performance and other developments. Such forward-looking statements are necessarily estimates reflecting the Company's best judgment based upon current information and involve a number of risks and uncertainties. There can be no assurance that other factors will not affect the accuracy of such forward-looking statements. It is impossible to identify all such factors, factors that could cause actual results to differ materially from those estimated by the Company. They include, but are not limited to the Company's ability to consummate and complete operations, the Company's access to future capital, government regulation, managing and maintaining growth, the effect of adverse publicity, litigation, competition and other factors that may be identified from time to time in the Company's public announcements. The Company undertakes no obligation to revise or update such statements to reflect current events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

This press release is provided for information purposes only and is not intended to constitute an offer to sell or a solicitation of any offer to buy securities.

Contact Information

  • Contact:
    GREM USA
    Edward Miers
    260-456-2354