Exco Technologies Limited announces purchase of South American extrusion tool business

TORONTO, July 27, 2011 /CNW/ -Exco Technologies Limited (TSX-XTC) today announced that it has entered into an asset purchase agreement for the acquisition of a customer's extrusion tool making business situated in Colombia.  The acquisition secures for Exco an experienced workforce and an agreement to supply the majority of the customer's extrusion tooling requirements.  In addition to the all cash purchase price of approximately $750,000.00, Exco will move, over the next several months, machinery and equipment worth approximately $1 million from Exco's recently closed AluDie facility in Canada to Columbia and Exco will invest an additional amount of approximately $1 million for leasehold improvements and additional machinery and equipment over the next year.  The operating results are expected to be accretive in the second year of operation.  The agreement is subject to usual conditions and is expected to close in October of this year.

Exco currently exports approximately $5 million worth of extrusion tooling to a number of South American countries including Colombia.  Once Exco has concluded this acquisition and satisfied its supply agreement obligations to the Customer it will transfer this business to the Colombian facility over the next 2 to 3 years.  This is expected to make available some capacity at Exco's remaining Canadian extrusion die facility which can then be used to meet North American demand as economic conditions improve.  It is expected that once this process is complete the Colombian business will generate annual sales of approximately $8 million to $10 million. This is consistent with Exco's goal of pursuing market share in developing regions and manufacturing in low cost jurisdictions.

Exco Technologies Limited is a global supplier of innovative technologies servicing the die-cast, extrusion and automotive industries.  Through our 10 strategic locations, we employ 1,994 people and service a diverse and broad customer base.

This news release contains forward-looking information and forward-looking statements within the meaning of applicable securities laws. We use words such as "anticipate", "plan", "may", "will", "should", "expect", "believe", "estimate" and similar expressions to identify forward-looking information and statements especially with respect to consolidated and operational sales levels and earnings and the future cash flow of the Company.  Such forward-looking information and statements are based on assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe to be relevant and appropriate in the circumstances. Readers are cautioned not to place undue reliance on forward-looking information and statements, as there can be no assurance that the assumptions, plans, intentions or expectations upon which such statements are based will occur.  Forward-looking information and statements are subject to known and unknown risks, uncertainties, assumptions and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed, implied or anticipated by such information and statements.  These risks, uncertainties and assumptions  are described in the Company's Management's Discussion and Analysis included in our 2010 Annual Report, in our 2010 Annual Information Form and, from time to time, in other reports and filings made by the Company with securities regulatory authorities.

While the Company believes that the expectations expressed by such forward-looking information and statements are reasonable, there can be no assurance that such expectations and assumptions will prove to be correct.  In evaluating forward-looking information and statements, readers should carefully consider the various factors which could cause actual results or events to differ materially from those indicated in the forward-looking information and statements. Readers are cautioned that the foregoing list of important factors is not exhaustive.  Furthermore, the Company disclaims any obligations to update publicly or otherwise revise any such factors or any of the forward-looking information or statements contained herein to reflect subsequent information, events or developments, changes in risk factors or otherwise.

For further information:
Source: Exco Technologies Limited (TSX-XTC)
Contact: Paul Riganelli, Vice-President, Finance and Chief Financial Officer
Telephone: (905) 477-3065 Ext 7228
Website: http://www.excocorp.com


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