Here's the full PREnergy & Engine Technology Announces BMZ Business Opportunities Including Potential $20,000,000 in Business with the Brazilian Government Over Ten Years
Thursday , June 03, 2004 11:16 ET
PLANO, Texas, Jun 3, 2004 /PRNewswire-FirstCall via COMTEX/ -- Energy & Engine Technology Corporation (OTC Bulletin Board: EENT) (EENT) today announced potential additions to its business through the acquisition of BMZ Generators, scheduled to close by mid-July.
When EENT engaged BMZ to assist in final design and production of its AXP 1000 for the trucking industry in 2003, BMZ needed a larger facility and additional working capital to exploit various opportunities. As BMZ and EENT have worked together to bring the AXP 1000 to market, they have also taken further steps to expand and secure AXP production and set the stage for exploiting further BMZ opportunities. EENT's acquisition of BMZ and funding of the final build out of the new production facility will enable pursuit of those significant business opportunities.
The first opportunity is a good example of the potential valued added to EENT's business represented by the BMZ acquisition. BMZ has entered into a contract with a Brazilian Company to represent it in the acquisition of business with the Brazilian Government. An authenticated copy (by the American Consulate) of the contract was recently received. The Brazilian Government requires a Brazilian Company intermediary for acquisitions from outside their Country. BMZ has worked toward consummation of the relationship since mid 2002. The Brazilian Company projects a total of $20,000,000.00 in business over a 10-year period beginning with $200,000 in the first year and $2,000,000 per year thereafter. With EENT's provision of additional resources to BMZ, management believes that not only can AXP 1000 production be increased in reaching its full market potential, but significant additional business volume will be generated as the new production facility comes on line (projected for July 2004).
EENT funds will enable continuing product development and production of its products for the trucking industry plus compatible opportunities and products for the marine, industrial, and military market opportunities acquired pursuant to the BMZ transaction. Additional potential projects include the following examples.
BMZ has a 25-year working relationship with a United States Department of Defense Registered Contractor. Recent conversations continue regarding proprietary generator design and assembly to supply an ongoing military contract for the US military and its allies.
BMZ has previously supplied proprietary generator products to the Venezuelan military as well as portable military hospital locations as remote as polar areas with -50 to -90 degree temperatures. Other product has been supplied for tanks and classified military use.
BMZ is the exclusive representative for the largest manufacturer of welding machines in Latin America. The Company desires to gain market share in the US for their welders and derivative products. The welding machines are competitors to the Lincoln and Miller brands now in the US market.
BMZ has engaged a representative in Brazil to market its generator products to the five principal boat builders in Brazil. Direct contact with the initial builder has occurred and a prototype provided. This builder produces approximately 100 boats per year. This Company and the other four comprise about 70% of all new boat building in Brazil.
Existing BMZ business relationships
* Local and Original Equipment Manufacture (OEM) distributor for
-- ONAN generators (25 years)
-- Lombardini marine engines
-- Kubota engines
-- Isuzu engines
-- Yan Mar engines
-- Briggs and Stratton engines
Various other distributorships include Kawasaki turbines and Faryman engines.
"These business opportunities represent the valued added revenue potential through the BMZ acquisition and demonstrates the importance of the addition of BMZ to EENT's business" stated Will McAndrew, EENT's CEO. As stated in an earlier press release, EENT has executed a definitive agreement to acquire the assets of BMZ Generators & Welders, Inc. ( http://www.bmzgenerators.com ), its supplier of generators and contract assembler for the AXP 1000 product, and related intellectual property. The purchase price is a total of up to $2,000,000, with $500,000 cash (subject to prepaid deposits and $200,000 to be paid directly by EENT to the contractor in the process of building out the interior of the new facility to be occupied by EENT and owned by Freddy Pereira, BMZ's owner(leased by EENT on market terms)) and $500,000 in EENT restricted stock due at the time of closing and presentation of complete documentation on the intellectual property being purchased, and up to $1,000,000 due over a period of 5 years, based on various performance criteria.
The acquisition will include the assembly facility for the AXP 1000 product (not including the underlying real estate), other assets of BMZ, and related intellectual property. The transaction is expected to close within the next 60 days, and the exact date is based upon certain practicalities, including, ability to move into the new facility and completion of an audit on BMZ's historical financials. EENT is to lease the 10,000 square foot Pompano Beach facility owned and currently being built out by BMZ's owner, Freddy Pereira. While assembly of AXP 1000 units has been slower than expected due to the existing strict space limitations at the current BMZ location, it is anticipated that, at full capacity, with more than one shift running per day, the facility could eventually produce 500 units per month, although initial capacity in the new facility is anticipated to be 100 units per month.
About Energy & Engine Technology Corporation (EENT)
EENT ( http://www.eent.net ), headquartered in Plano, Texas, develops and markets auxiliary power generators for the long haul trucking industry. The Company's common stock is traded on the OTC Bulletin Board under the symbol "EENT". The Company's flagship product, the AXP 1000, is an idle-reduction technology device, designed for new and retrofit installation on semi truck tractors, that provides power generation without requiring the operation of the truck's engine. Powered by an EPA-approved and CARB-certified engine, the AXP 1000 maintains the truck's battery power while delivering electricity for air conditioning, heating, and the operation of televisions, appliances and other devices, to the sleeper cab, thereby reducing fuel consumption, air/noise pollution and long-term truck maintenance costs. (Instead of the 10-15 gallons of diesel fuel consumed through idling each day, the AXP 1000 consumes approximately 1 gallon of diesel fuel in an equivalent amount of time). The Company is targeting a significant market opportunity created by governmental mandates that limit the aggregate amount of idling time available to long haul truckers. Management believes that Federal and State regulations, along with new and more stringent legislation that became effective in January 2004, have paved the way for a $2.5 billion industry. There are an estimated 500,000 or more Class 8 sleeper trucks currently operating in the U.S., with over 80,000 new Class 8 trucks being produced each year. Management believes that even moderate penetration of the market for anti-idling devices could result in significant sales and earnings for the Company. Anticipated metrics on unit sales suggest that for each 1,000 AXP 1000 units sold (at $5,000 each), the Company should generate gross revenue of approximately $5,000,000.
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements. Certain information included in this communication (as well as information included in oral statements or other written statements made or to be made by Energy & Engine Technology Corporation) contains statements that are forward-looking, such as statements relating to the future anticipated direction of the high technology and energy industries, plans for future expansion, various business development activities, planned capital expenditures, future funding sources, anticipated sales growth and potential contracts. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may differ from those expressed in any forward-looking statements made by or on behalf of Energy & Engine Technology Corporation. These risks and uncertainties include, but are not limited to, those relating to development and expansion activities, dependence on existing management, financial activities, domestic and global economic conditions, changes in federal or state tax laws, and market competition factors.
SOURCE Energy & Engine Technology Corporation
CONTACT: Energy & Engine Technology Corporation, +1-972-732-6360
URL: http://www.eent.net http://www.prnewswire.com
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