Aims To Expand US- And Mexico-Based Manufacturing
Capabilities
Ballistic Recovery Systems Inc.
announced Wednesday it has entered into a non-binding Letter of
Intent for the establishment of Advanced Tactical Fabricators
(ATF), a subsidiary to be partially owned by Minnesota-based Head
Lites Corporation following fulfillment of certain
pre-conditions.
The new company would acquire reflective components/trims assets
of Head Lites Corporation and establish operations in St. Paul, MN;
Pine Bluff, NC and Tijuana, Mexico. Completion of the transaction
is pending due diligence investigations; the definitive agreement
is expected to be completed by the end of this year, according to
BRS.
"This acquisition would reinforce our commitment to capitalize
on what we believe are attractive long-term growth prospects in
textile fabrication for aviation and non-aviation applications,"
said BRS CEO Larry E. Williams. "BRS believes that ATF would play a
pivotal role by combining the strengths of BRS and Head
Lites’ and could immediately improve our opportunity for top
line growth and operational efficiencies.”
ATF would focus on the growing opportunity for textile
fabrication operations and meet the need for United States-based
sewing for parachutes and other products related to US Department
of Defense work. Head Lites is a leader in the reflective safety
products and had 2006 revenues of more than $3.5 million.
"This agreement would merge the strong brands, technical
expertise and market presence of our two companies," said Head
Lites President Gary Lesley. "We also expect to achieve substantial
synergies to further enhance the already profitable Vis-Mat,
Vis-Tac and Head Lites brand components/trims business."
"We see our activities in establishing ATF as forming a very
important part of our businesses diversification strategy," added
BRS Chairman Robert L. Nelson.
Williams told ANN the company hopes to build on "the wealth of
experience and expertise which we have accumulated from our BRS
textile fabrication activities in Tijuana" to further the BRS
business line.
"The focus of ATF would broaden from our traditional ones --
whole airplane parachutes -- to include non-aviation safety
applications," Williams added. "This transaction, if consummated,
together with other projects previously announced by us, is ample
evidence that we have the ability to overcome complexities and
generate attractive business opportunities in other areas,
therefore accomplishing our diversification strategy."
In addition to providing the CAPS recovery system (shown above)
for all Cirrus SR-series aircraft, BRS also offers whole-airplane
parachute recovery systems for a variety of general aviation and
light-sport aircraft. The company will also provide parachute
recovery systems for the upcoming Cirrus "the-jet," as well as
Diamond's upcoming DA50 large single-engine piston aircraft, and
the Diamond D-Jet.
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