ModusLink strengthens its position as a leading provider of
integrated returns processing, technical repair and value recovery
services for consumer electronics and business technology companies
WALTHAM, Mass.--(BUSINESS WIRE)--Dec. 7, 2009--
ModusLink Global Solutions™, Inc. (NASDAQ: MLNK), which provides global
execution of multichannel supply chain processes for the world’s leading
technology brands, announced that it has acquired Tech for Less LLC
(TFL), a leading processor and marketer of customer-returned consumer
electronics and business technology products. The all-cash transaction
is valued at $30 million, plus additional performance-based
consideration of up to $10 million if certain financial performance
measures are met in calendar year 2010. The transaction is expected to
be accretive to ModusLink’s cash flow and neutral to earnings in fiscal
2010 and accretive to cash flow and earnings in fiscal 2011.
Based in Colorado Springs, Col., TFL acquires returned and excess
technology products from retailers, e-tailers, distributors and
manufacturers. TFL tests and repairs the merchandise and remarkets it to
consumers via its highly trafficked website (www.techforless.com)
and other direct channels.
TFL provides ModusLink with a robust business-to-consumer asset recovery
channel for technology products, strengthening ModusLink’s existing
value recovery capabilities. TFL’s services will become part of
ModusLink’s Aftermarket Solution offering, which is designed to manage
the complete range of post-sales activity for high-tech companies, from
customer service, technical support and multichannel returns management
to testing, repair and asset disposition.
“Tech for Less is an innovative business that will expand the value
ModusLink brings to clients in the aftermarket supply chain,” said
Joseph C. Lawler, chairman, president and chief executive officer of
ModusLink Global Solutions. “Aftermarket services is a very compelling
space for ModusLink given its growth, financial characteristics and
importance in the overall supply chain. Through organic development,
plus our previous acquisition of ModusLink PTS and now the addition of
TFL, ModusLink has strengthened its position as a leading provider of
integrated returns processing, technical repair and value recovery in
the consumer electronics and business technology markets. We look
forward to working with the management team and employees at Tech for
Less and sharing in our future success.”
For the twelve months ending December 31, 2009, TFL is expected to
generate revenue of approximately $40 million. The company’s unaudited,
compounded annual growth rate for revenue since 2006 has been
approximately 14%.
“With Tech for Less now part of ModusLink’s supply chain solutions, TFL
customers will continue receiving the high-quality products and service
they have come to expect,” said Jason Lockwood, president of Tech for
Less. “In addition, we look forward to adding value to ModusLink’s
aftermarket solutions by helping major consumer electronics companies
maximize asset value recovery on returned and excess products in the
supply chain.”
About ModusLink Global Solutions, Inc.
ModusLink Global Solutions, Inc. is a leader in global supply chain
business process management. The Company executes critical processes for
clients in the high technology and communications industries to provide
competitive differentiation and enable new channel and new market
opportunities. ModusLink Global Solutions’ integrated portfolio of
supply chain outsourcing and technology solutions span four core
competencies: supply chain, aftermarket, e-Business and entitlement
management. The Company has headquarters in Waltham, Massachusetts and
more than 25 facilities in 14 countries – giving it the largest global
footprint in the industry. For additional information, visit www.moduslink.com.
ModusLink Global Solutions is a registered trademark of ModusLink
Global Solutions, Inc. All other company names and products are
trademarks or registered trademarks of their respective companies.
This release contains forward-looking statements, which address a
variety of subjects including, for example, the expected benefits of the
transaction, the expected impact to earnings and cash flow, the expected
financial performance and contribution of Tech For Less and the
expansion of capabilities expected to occur as a result of the
transaction. The following important factors and uncertainties, among
others, could cause actual results to differ materially from those
described in these forward-looking statements: There can be no assurance
that projected financial results will be attained; the success of
ModusLink Global Solutions (“ModusLink”)depends on its ability to
execute on its business strategy and the continued and increased demand
for and market acceptance of its solutions and services; ModusLink may
not be able to expand its operations in accordance with its business
strategy; ModusLink may experience difficulties integrating
technologies, operations and personnel in accordance with its business
strategy; ModusLink derives a significant portion of its revenue from a
small number of customers and the loss of any of those customers would
significantly damage its financial condition and results of operations;
increased competition and technological changes in the markets in which
ModusLink competes; and risks associated with international operations.
For a detailed discussion of cautionary statements that may affect
ModusLink’s future results of operations and financial results, please
refer to its filings with the Securities and Exchange Commission,
including its most recent Annual Report on Form 10-K. Forward-looking
statements represent management's current expectations and are
inherently uncertain. We do not undertake any obligation to update
forward-looking statements made by us.
Source: ModusLink Global Solutions, Inc.
Investors-Financial:
ModusLink
Bob Joyce, 781-663-5120
Director,
Investor Relations
ir@moduslink.com
or
Media:
ModusLink
Farrah
Phillipo, 781-663-5096
Communications Manager
farrah_phillipo@moduslink.com
or
SHIFT
Communications
Maura Landry, 617-779-1829
mlandry@shiftcomm.com
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