StockerYale Pursues Virtek

SALEM, N.H., May 19, 2008 -- StockerYale has offered to buy Waterloo, Ontario-based Virtek Vision International Inc. for $22 million in stock and cash, or 65 cents a share.

Salem-based StockerYale makes structured light lasers, LED modules and specialty optical fibers for industrial OEMs. It also has facilities in Canada, the UK and Ireland. Virek provides laser-based marking and engraving, precision laser templating and laser inspection products for industrial material processing.

"By combining these businesses, we expect to quickly realize synergies by eliminating certain redundant public company costs and cross-selling the product offerings of the two businesses to each other's customers. In addition, we are excited to combine the strong engineering teams of the two companies and to fully leverage our R&D efforts," StockerYale Chairman and CEO Mark W. Blodgett said in a statement.

The offer represents a 48 percent premium over Virtek's closing price on May 13, the day the offer was made, and a 58 percent premium above the stock's 30-day average. The deal would involve issuing Virtek stockholders approximately 7.8 million shares of StockerYale stock -- about 20 percent of its outstanding shares -- with the rest of the purchase price in cash, StockerYale said. It has lenders interested in providing the cash portion of the purchase price should a definitive agreement be reached.

In a separate statement, Virtek said its board of directors intends to meet this week to discuss the unsolicited letter of interest from StockerYale and to decide what action it will take, if any.

Blodgett said StockerYale's last significant acquisition was in 2006 when it acquired UK-based Photonic Products Ltd. In October 2007 the company bought Spectrode LLC, a developer of pulsed thulium-doped fiber laser technology (See also: StockerYale Buys Spectrode)

StockerYale said it expects the transaction to receive regulatory approvals and close in the second half of 2008.

For more information, visit: www.stockeryale.com

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About StockerYale Inc.

Published: May 2008

Glossary

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optical fiber: Optical fiber is a thin, flexible, transparent strand or filament made of glass or plastic used for transmitting light signals over long distances with minimal loss of signal quality. It serves as a medium for conveying information in the form of light pulses, typically in the realm of telecommunications, networking, and data transmission. The core of an optical fiber is the central region through which light travels. It is surrounded by a cladding layer that has a lower refractive index than...
photonics: The technology of generating and harnessing light and other forms of radiant energy whose quantum unit is the photon. The science includes light emission, transmission, deflection, amplification and detection by optical components and instruments, lasers and other light sources, fiber optics, electro-optical instrumentation, related hardware and electronics, and sophisticated systems. The range of applications of photonics extends from energy generation to detection to communications and...

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