PRINCETON, N.J., Feb. 9, 2015 /PRNewswire/ -- AMREP Corporation
(NYSE: AXR) today reported that it has sold its Newsstand
Distribution Services business and its Product Packaging and
Fulfillment Services business pursuant to the sale of capital stock
to entities controlled by Michael P.
Duloc. The closing of the sale occurred on February 9, 2015.
The buyers paid an aggregate purchase price of $2.0 million, which consisted of $400,000 of cash paid on the closing and
$1.6 million paid by execution of a
secured promissory note. The Newsstand Distribution Services
business and the Product Packaging and Fulfillment Services
business will retain all of their third party pre-closing assets,
liabilities, rights and obligations, including the negative working
capital of the Newsstand Distribution Services business, which
totaled $12,672,000 at October 31, 2014. AMREP expects to
recognize a pre-tax gain on its financial statements as a result of
the transaction in the fourth quarter of fiscal year 2015 which it
estimates will range from approximately $8
million to $10 million.
Prior to the closing, Mr. Duloc was the chief executive officer
and president of AMREP's Newsstand Distribution Services business
and Product Packaging and Fulfillment Services business and certain
other subsidiaries of AMREP.
"After many years in the magazine distribution and product
fulfillment businesses, we are pleased that this transaction will
allow AMREP to focus primarily on its real estate and subscription
fulfillment services businesses to drive shareholder value," said
Edward B. Cloues, II, Chairman of
AMREP. "This disposition will sharpen our focus and strengthen
AMREP's balance sheet by eliminating the negative working capital
overhang."
Additional details on the sale transaction are provided in
AMREP's Current Report on Form 8-K filed with the Securities and
Exchange Commission on February 9,
2015.
About AMREP – AMREP Corporation's Palm Coast Data
subsidiary provides subscription related services to publishers,
membership organizations and others, its Kable Staffing subsidiary provides temporary
staffing services and its AMREP Southwest subsidiary is a major
holder of real estate in New
Mexico.
Forward-Looking Statements – This press release may
contain certain forward-looking statements, including statements
with regard to the expected gain, if any, to be recognized as a
result of the transaction and the expected focus of AMREP in the
future. Words such as "believes," "expects," "projects," and
"future" or similar expressions are intended to identify
forward-looking statements. These forward-looking
statements are subject to the inherent uncertainties in predicting
future results and conditions. Certain factors could
cause actual results to differ materially from those projected in
these forward-looking statements, and some of these factors are
discussed in the filings AMREP makes with the Securities and
Exchange Commission. AMREP undertakes no obligation to
publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
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SOURCE AMREP Corporation