SOURCE: Grifco International Inc

July 07, 2005 13:09 ET

Grifco Acquires Global Oil Tools and Global Libya Manufacturing Facility Project

HOUSTON, TX -- (MARKET WIRE) -- July 7, 2005 -- Grifco International Inc's (OTC: GFCI) acquisition of Global oil tools for $ 4.5 Million Dollars in cash and stocks has been finalized by both companies after intense negotiations involving Global Oil Tools, The Lyamec Corporation and American Finance Corp.

The combination of cash and stock allowed Grifco to negotiate better acquisition terms than that of the previous LOI of February 2005 . The new terms provides a superior transaction for Grifco's share holders. Grifco acquired Global assets without having to assume the liabilities of about $ 840,000.00 USD. The immediate tangible benefits of this strategic acquisition are an attractive fit with Grifco's overall operations and capabilities. The acquisition of Global Oil Tools enhances Grifco 's position to realize significant economies of scale by targeting Synergies in a number of operations and corporate function, including cost savings, productivity, entering new markets, and accretive on earnings and cash flow per share basis, creating long term investment value for shareholders.

Jim Dial, President and CEO of Grifco International, Inc., stated, "I am very pleased that we were able to come to an agreement that all parties are excited about. Today we have been presented with an opportunity for incredible growth and plan to take full advantage of it."

Additionally, under a marketing development and marketing agreement with The Lyamec Corporation, Grifco positioned itself for a 55% stake ownership of the technology transfer manufacturing and distribution rights for Libya, The Middle East, Africa, and Azerbaijan. In connection with this transaction, Grifco would now directly benefit from a 20 Million USD planned order originally set to kick start the Libya manufacturing facility in Libya. The Libya manufacturing facility currently approved for implementation under Libya's Law #5/1997, will pave the way for Grifco to access and expand its international sales by tapping a 400 Million USD market. The strategic manufacturing facility is staged to be one of the most advanced manufacturing and distribution facilities in all of Africa.

Overhauling and modernizing Libya's deteriorated oil fields to their previous production levels after 25 years of U.S. sanctions presents an excellent opportunity for Grifco to sell its oil tools, coil tubing and jet motor units. As is already expected, rentals of these advanced patented technologies have built a backlog of advance inquiries to utilize these units. The long awaited delivery of these items have attracted a wide array of Libyan representation and rental outlet requests to manage the sought after technology. The Lyamec Corporation, a merchandising, distribution and marketing company with advanced specific market targeting and market campaigning is leading the promotion of Grifco's new technologies in the region.

Additionally, American Finance Corp, a 20% stake owner of The Lyamec Corporation, entered into agreement to provide export facilitation to assist Grifco with the preparation to sustain the supply and the commercial marketing aspect of the jet motor units. Further, American Finance Corp. has been retained by Grifco International to provide it with access to more than 40 Million USD in financial support aimed to cope with promoting and exporting U.S. products to the contracted markets.

Further, Grifco expects to bring out an update shortly on the rental of our jet motor units to major oil and gas companies, as well as large independents.

Grifco International is a leading provider of oil and gas services equipment, specializing in the conception, architecture, and development of tools for the coil tubing, wireline, and snubbing industry throughout the U.S., China, Mexico and South America. Grifco's patented products are known and used throughout the world. In addition to our patented tools, Grifco designs and manufactures over 350 products for the Oil and Gas industry with a clientele boasting the biggest names in the business, including Halliburton, Exxon, and Schlumberger. Please visit www.grifco.org.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The Company cautions the assumptions, expectations, projections, intentions, or beliefs about future events may, and often do, vary from actual results and the differences can be material. Some of the key factors which could cause actual results to vary from those the Company expects include changes in natural gas and oil prices, the timing of planned capital expenditures, availability of acquisitions, uncertainties in estimating proved reserves and forecasting production results, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as our ability to access them, and uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting our business. More information about the risks and uncertainties relating to the Company's forward-looking statements are found in our SEC filings.

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