Pointer Telocation Systems Ltd. (Nasdaq:PNTR) has bought out its partner in its Brazilian subsidiary, Pointer do Brasil Comercial SA for $4.3 million in cash. Bracco do Brasil Empreendimentos e Participações Ltda. owned 51.2% of the company. The deal will be closed in October.
Full ownership of Pointer do Brasil will enable Pointer to recognize its revenue in full, which is estimated at several million dollars a year.
Pointer which had $2.5 million in cash at the end of June, will take a bank loan to finance the acquisition. It will repay $1.2 million in loans to Bracco and a Brazilian bank over 18 months.
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Pointer CEO David Mahlab said, “This accretive acquisition is in line with our strategic goal for international growth. We established Pointer Brazil with local partners in 2009 and we expect the acquisition will increase Pointer’s revenues as well as improve our results. This acquisition is a proof of Pointer’s trust in our Latin America business.”
Published by Globes www.globes-online.com