RICHMOND, British Columbia (Nov. 19, 2001)—SmarTire Inc., the Richmond-based manufacturer of tire pressure and temperature monitoring systems, is offering up to 3 million units of its stock in a private placement designed to raise $5.1 million to pay off the firm's debt and provide working capital.
Each unit in the private placement consists of one share of stock at a minimum price of $1.70, plus a purchase warrant for one more share of stock within the next 24 months at a price of between $2.30 and $3.30.
About one-third of the $5.1 million has already been raised, according to a SmarTire spokeswoman. The company will offer the private placement until the stock sale is completed, she said.
SmarTire has spent more than a decade developing its tire monitoring systems, and within the last few months announced European and North American shipment of its new generation of aftermarket products. Those products are being distributed in North America by The Tire Rack and Big O Tires, the company said in a press release.
It also announced the restructuring of its strategic alliance with TRW Inc. to allow marketing of its systems to all levels of the auto industry, including original equipment buyers.
For its fiscal year ended July 31, SmarTire reported a net loss of $5.5 million on sales of $780,000, compared with a profit in fiscal year 200 of $1.9 million on sales of $748,000. An $8.3 million profit on the sale of an investment in March 2000, plus a delay this year in releasing the company's second generation of tire monitoring products, explains the difference in profit between the two years, according to a company release.