WPCS Closes on the Sale of Its Interest in China Operations

SUISUN CITY, CA--(Marketwired - Aug 17, 2015) - WPCS International Incorporated (NASDAQ: WPCS), which specializes in contracting services for communications infrastructure, announced today that on August 14, 2015, it closed on the sale of its 60% joint venture and profit interest in Tai'an AGS Pipeline Construction Co. Ltd., a contractual joint venture established in accordance with the laws of the People's Republic of China ("TAGS"), to Canada-based Halcyon Coast Investment Ltd. ("HCI"). On August 5, 2015, the Company had received the requisite approval from the Tai'an Bureau of Commerce and Industry, which enabled the parties to finalize the transaction. 

According to Interim CEO Sebastian Giordano, "Having recently completed a $1,575,000 equity financing and secured a $1,000,000 line of credit, the remaining $1,150,000 of net proceeds from this transaction improves our liquidity even further."

On June 3, 2015, the Company had entered into an agreement with HCI to sell TAGS in an "as-is," all-cash transaction, for a total purchase price of $1,500,000 and received a $150,000 refundable deposit at signing. Upon closing, the Company received the remaining cash proceeds of $1,350,000, of which (i) it paid approximately $100,000 in a broker's fee and (ii) $100,000 will be held in escrow, for up to one year from the date of the closing, pending a final determination by the Chinese government with respect to any tax obligations arising from the transaction. Otherwise, the transaction is not subject to any further post-closing adjustments. 

"I am very pleased to announce that this divestiture represents the final step in the restructuring plan we initiated back in August 2013. With our profitable Suisun Operation and the recent announcement that we have retained WestPark Capital as the Company's investment banker, we will be concentrating exclusively on growing our business both organically and strategically, the goal of which is to increase shareholder value," Giordano concluded.

About WPCS International Incorporated
WPCS provides contracting services to the public services, healthcare, energy and corporate enterprise markets in the United States. For more information, please visit www.wpcs.com.

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