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NOVEMBER 2008
GreenMan to
sell tire recycling operations for over $26 million
GreenMan Technologies, Inc. has entered into an
agreement with Liberty Tire Services of Ohio, LLC,
a wholly-owned subsidiary of Liberty Tire Services,
LLC, to sell, subject to shareholder approval, substantially
all assets of two wholly-owned subsidiaries, GreenMan
Technologies of Minnesota, Inc. and GreenMan Technologies
of Iowa, Inc. GreenMan expects the cash proceeds
from the transaction will exceed $26 million and,
subject to shareholder approval and the satisfaction
of customary closing conditions, expects the transaction
to close by the end of 2008.
GreenMan intends to use approximately $19 million
of the proceeds to retire certain transaction related
obligations, including approximately $13 million
due its primary secured lender, Laurus Master Fund,
Ltd, under a June 2006 credit facility.
If the transaction is completed, GreenMan will have
minimal long-term debt and more than $5 million
of available cash as it moves forward with its two
remaining subsidiaries, Welch Products, Inc. and
its newest subsidiary announced last week, GreenMan
Renewable Fuel and Alternative Energy, Inc. Concurrent
with the closing of this transaction, Liberty and
GreenMan will enter a strategic multi-year feedstock
supply agreement that will ensure an adequate supply
of crumb rubber to support Welch’s growth objectives.
The Boards of Directors of GreenMan and Liberty
Tire Services, LLC have unanimously approved the
transaction.
Welch Products, Inc., headquartered in Iowa, has
achieved approximately 100 percent revenue growth
this year and has recently signed various state
contracts demonstrating continued market penetration.
Welch Products specializes in the design, product
development and manufacturing of products using
recycled materials made primarily from recycled
rubber.
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