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Livingston acquires New-York-based U.S. customs brokerage firm
FOR IMMEDIATE RELEASE
Attention Business Editors
March 2, 2005
TORONTO, Canada - Livingston International Inc. has, through its U.S. operating subsidiary, acquired all of the shares of Great Lakes Customs Brokerage, Inc., including trade software company South Ranch, Inc., Livingston CEO Peter Luit announced today. Livingston is owned by the Livingston International Income Fund, the units of which trade on the Toronto Stock Exchange (TSX) under the symbol LIV.UN.
Great Lakes and South Ranch were privately owned by their founders, Nick Quarantillo and Tom Korpolinksi. The transaction was financed by a draw down of 75% of the approximately US$ 14.8 million purchase price under the revolving line of credit in Livingston's new credit facility. The remaining 25% has been paid through the issuance from treasury of 210,600 new fund units. A two-year lock up period applies to these newly issued units of the fund, such that 50% will be released for resale after the first year and the remaining 50% after the second year. Management expects the transaction to be immediately accretive and is confident that per-unit distributions will not be adversely affected.
The acquisition is part of Livingston's growth strategy to expand its U.S. customs brokerage business. Livingston is also enthusiastic about the SmartBorder information technology solutions that it is acquiring through the South Ranch business.
In addition to the software unit, Livingston gains Great Lakes' customs brokerage and distribution business. The addition of about 103 full- and part-time employees will increase its U.S. workforce by about 35 per cent. Last year, Great Lakes had combined annual revenues of approximately US$ 7.4 million.
For the foreseeable future, Great Lakes will continue to operate independently and focus on its loyal client base; South Ranch will also continue to provide their technology services to its predominantly U.S. air/sea customs broker clients. No staff reductions are expected. Great Lakes former owner Nick Quarantillo will head up the South Ranch application service provider (ASP) business as vice-president, SmartBorder, reporting to Livingston CFO Ben Wong, while Tom Korpolinski will run Great Lakes' U.S. brokerage operation as vice-president, Great Lakes Customs Brokerage, reporting to Peter Luit.
Livingston International Inc. is Canada's leading customs broker and trade services company facilitating two-way trade between the United States and Canada. Based in Toronto, Ontario, the company has over 70 offices and approximately 1,500 employees located at key border points and other strategic locations across Canada and the United States.
For more information, contact:
Certain statements in this release are forward-looking statements, which reflect management's current beliefs and expectations. Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including risks related to dependence on cross-border trade, economic conditions, disruptions in border crossings and regulatory change, among others. Undue reliance should not be placed on forward-looking statements.
Livingston International Inc.
416 626-2800 ext. 3109