Optelecom to Acquire NKF Electronics

GERMANTOWN, Md., Feb. 16 -- Optelecom Inc. announced today it has signed a letter of intent to acquire NKF Electronics, a Netherlands-based subsidiary of Draka Holding NV, in a nondilutive transaction valued at approximately $26 million, financed with a combination of senior and subordinated debt. Optelecom said an agreement is subject to advice from the Dutch Workers Council, final financing commitments and the receipt of audited financial statements from NKF Electronics BV, among other things.

Optelecom said the purchase should double its operations and revenue and enhance its position as an independent producer of fiber optic-based communications technology for video surveillance, traffic monitoring and business video systems.

"Having both cooperated with and competed against NKF for a number of years, we have been greatly impressed with the NKF team and their product lines," said Edmund Ludwig, Optelecom's president and CEO. "Given that NKF's primary market position and focus is centered in Europe, while Optelecom is an industry leader in the US marketplace, the Optelecom/NKF combination . . . would create a diversified company that is a global leader in the video surveillance and intelligent transportation markets."

Founded in 1981, NKF Electronics offers communications products including fiber optic video modems, multiplexers and video-over-IP networks for local, metropolitan and wide area networks, especially those in harsh environmental conditions or separated by long distances from transmission locations.

For more information, visit: www.nkfelectronics.com