ATLANTA, Jan. 16, 2014 (GLOBE NEWSWIRE) -- Video Display Corporation (Nasdaq:VIDE), a worldwide leader in the development of display technology for military, medical and simulation markets, today announced the closing of the previously announced Purchase and Sales Agreement of its Phelps, NY based Z-AXIS Inc. and Bear Power subsidiaries to one of the subsidiary's original founders. The aggregate consideration for the sale, being paid approximately 90% in cash and the balance with fixed interest debt, is expected to result in a taxable gain to Video Display Corporation of approximately $5.5 million subject to certain post-closing adjustments, legal fees and other transaction related expenses.
The transaction was closed under primarily the same terms of the Purchase Agreements announced on October 3, 2013.
As a result of the sale of the subsidiary, VDC management will be adjusting its financial targets for fiscal year-end February 28, 2014 to reflect the exclusion of Z-AXIS operating results and will file a SEC Form 8-K with updated financial numbers reflecting those revised expectations.
"We are very pleased to announce the closing of the transaction transferring the ownership of Z-AXIS and Bear Power to the new owner," said Ron Ordway, CEO of Video Display Corporation. "This is another integral and important step in the previously announced VDC program of enhancing shareholder value through strategic sales of assets, divisions and subsidiaries of the Company."
"Z-AXIS has been a successful part of Video Display Corporation for many years, and we are grateful to all the Z-AXIS employees for their dedication and service," added Ordway.
"With the Aydin Displays Inc. and the Z-AXIS transactions now having been completed, VDC becomes nearly debt free and maintains cash balances in excess of $10 million. The Company's future plans are to further develop the remaining display oriented subsidiaries (AYON CyberSecurity, AYON Visual Systems, Lexel Imaging Systems and VDC Display Systems) in an effort to further enhance shareholder value by building revenues and earnings through new products, new contracts and niche market acquisitions to strengthen these existing subsidiaries," continued Ordway.
About Video Display Corporation
Video Display Corporation designs, manufactures, markets, distributes, installs and provides a complete line of technologically advanced display products and systems for military, medical and industrial uses, with emphasis on high end training and simulation applications. We offer one of the best and most comprehensive customer support service, from basic components to turnkey systems used by government, military, space, medical, homeland security and commercial organizations worldwide.
For more information, visit the Company's web site at www.videodisplay.com
CONTACT: Ronald D. Ordway, Chairman and CEO
Source: Video Display Corporation