SuperCom: We will use proceeds from a planned offering for the acquisition of contracts, complimentary intellectual property, and software packages.
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/ By Shiri Habib-Valdhorn /
Ten days ago, during the hearing on the petition for receivership of Alvarion Ltd. (Nasdaq: ALVR; TASE: ALVR) at the Tel Aviv District Court, Judge Eitan Orenstin called for a recess when some people expressed an interest in acquiring the company. They were representatives of Sigma Wave Ltd., a private company based in Caesarea controlled by Arie Trabelsi, and they asked for a three-day postponement of the hearing. Judge Orenstin rejected the request and appointed a receiver for Alvarion.
Sources inform ”Globes” that Sigma Wave is still interested in acquiring Alvarion, this time from the receiver who is seeking to sell it.
Sigma Wave is the biggest shareholder in SuperCom Inc. (Bulletin Board: SPCBF) (formerly Vuance), a developer of electronic ID (EID) and radio frequency (RFID) devices (an alternative to barcodes), which has a market cap of $28 million. SuperCom, where Trabelsi is president and CEO, came to investors’ attention a few months ago, and its share price has jumped 7.6-fold since March from $0.10 to $.076. It plans to exploit this rally to hold a secondary issue to raise $20 million after August.
In early July, SuperCom announced that it would use proceeds from the offering for “the possible acquisition of contracts, selected complimentary intellectual property, and software packages from key players in the e-ID and electronic monitoring markets; develop a local presence in Europe and the Far East; and for working capital needs and other general corporate purposes.” The company had just $225, 000 in cash at the end of March.
One of the options that SuperCom is reportedly considering is the acquisition of Alvarion. Alternatively, Sigma Wave might acquire Alvarion directly, not through SuperCom. According to Sigma Wave’s representatives at Alvarion’s court hearing, the company believes that it can turn Alvarion around, just as it did SuperCom.
Sigma Wave invested in SuperCom in 2010, when it lost $2 million on $7.4 million revenue. In 2011, the company returned to profitability, and in 2012, it posted a profit of $4.8 million on $8.9 million revenue. It posted a net profit of $1.1 million for the first quarter of 2013.
In its investors presentation, SuperCom said that most of the turnaround was completed, and that it was positioned for profit growth. It added that it identified “synergetic targets” for mergers and acquisitions, and that it was looking at deals or assets which could help it rapidly grow its revenue base on the basis of its current expenses structure.
SuperCom wants to return to Nasdsaq, and at the upcoming general shareholders meeting it will ask them to approve a reverse share split at a 1:4.25 ratio to meet Nasdaq’s minimum price condition. Meanwhile, the company has two new parties at interest: Lazarus Israel Opportunities Fund, with a 7.6% stake; and Ephraim Fields, with 5.3%.
Published by www.globes-online.com