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GRMU: Merger News - 2008/10/09 08:48 am
GREM USA Announces Progress of Merger Negotiations; Continues Pursuit of OEM Agreements
FORT WAYNE, IN -- (Marketwire) -- 10/08/08 -- GREM USA (OTCBB: GRMU) ("GREM," "the Company"), an emerging leader in the design and manufacturing of custom hand-crafted and electric guitars, today announced the progress of ongoing merger negotiations.
Since June, the Company has been actively engaged in both formal and informal discussions with entities interested in exploring a potential merger. Although GREM management believes that many of these discussions have been productive, they have not yet resulted in an initial agreement that the Company would be able to disclose to shareholders. Both of the initial companies expressing an interest in a merger are significantly larger than GREM, which has created additional logistical challenges to coordinate various proposals with decision makers and their respective boards and/or committees.
While GREM has held discussions with top-tier instrument companies to pursue post-merger synergies, management has determined it to be in the interest of shareholders to also entertain opportunities in other industries to best position the Company for the highest-value transaction possible. Management remains optimistic that a firm agreement with either of the two instrument manufacturers can still be reached within the current calendar year.
Pertinent to the Company's custom hand-crafted guitar business, GREM continues to explore avenues to diversify its sales channels and increase margins. Specifically, the Company has successfully made inroads into developing OEM (original equipment manufacturer) relationships whereby GREM, as a third-party, would produce equipment branded by another manufacturer. The Company has been working to forge these partnerships for over the last year and management is confident that it will result in a manufacturing agreement able to be disclosed over the near term.
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