- Consummation of transaction is anticipated late in calendar 2017, with the merger calling for WPCS to be renamed DropCar after the closing; stock would continue to trade on NASDAQ under a ticker symbol proposed as DCAR
- Spencer Richardson, DropCar co-founder and CEO, would be CEO of the new entity; Sebastian Giordano, WPCS CEO, would serve on newly merged company’s board
- Goal for WPCS is to offer greater shareholder value for its stockholders; when merger is completed, WPCS shareholders would hold 16% of the outstanding common stock in the merged entity while DropCar’s shareholders and advisors would hold the remaining 84%
WPCS International, Inc. (NASDAQ: WPCS), through a wholly-owned subsidiary, has signed a definitive agreement to merge with privately-owned DropCar, Inc. The surviving entity will be named DropCar and the company’s common stock is proposed to trade on the NASDAQ Capital Market under ticker symbol DCAR, according to a December 7, 2017 WPCS SEC S-4 amendment filing.
WPCS will acquire DropCar in an all-stock transaction, the companies announced (http://nnw.fm/Qid5b). The transaction is expected to be consummated late in the fourth quarter of CY 2017. Sebastian Giordano, CEO of WPCS, would serve on the board of the new entity. Spencer Richardson, co-founder and CEO of DropCar, will be CEO of the merged entity.
WPCS is a California-based, low-voltage solutions provider. It installs and services integrated structured cabling, audio-visual and security services for public services, healthcare, energy, and corporate enterprise markets in the U.S. DropCar offers a cloud-based logistics and vehicle support platform designed to reduce the costs and hassles of owning a car in an urban center.
“This is a new and exciting chapter for WPCS,” Giordano said, explaining that the transaction would enable DropCar to “leverage its technology” and grow in the automotive support and logistics market.
Richardson added in a conference call that DropCar plans to expand into major cities worldwide in the future and said that the company already has more than 1,000 subscriber customers (http://nnw.fm/HQ8Ny). He called the company “well positioned” to grow as a destructor within the platform of automotive logistics.
When the transaction is completed, it is anticipated that WPCS common stock shareholders would hold 16% of the new entity’s common, while DropCar’s shareholders and advisors would hold the remaining 84%. However, as a December 4, 2017 SEC 8K filing shows, the actual percentages will be tweaked and modified by amendments to the merger agreement. Conditions to the closing call for DropCar to raise at least $4 million prior to consummation.
WPCS International offers full service and low-voltage end-to-end solutions. It can transform organizations with new ways to connect their services, communications, and resourcing.
DropCar, founded and launched in New York City in 2015 offers a cloud-based platform and mobile app that coordinates the activities of trained valets in urban centers. They move cars from secured garages to/from the people who own them. It targets, as its customers, both consumers and businesses, including dealerships and shared mobility companies. They use DropCar’s streamlined logistics for parking, taking the cost and hassle out of owning a car in a congested city.
DropCar recently signed a definitive agreement with Toyota of Manhattan for that dealership to utilize its Enterprise Vehicle Assistance & Logistics (“VAL”) platform, which offers tech logistics in the handling of service and delivery of vehicles.
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