| MER Telemanagement Solutions Ltd. | |||
| Ticker: | MTSLF | 10 Hakishon Street | |
| Exchange: | NASDAQ-National Market | Bnei Brak, ISRAL 51203 | |
| Industry: | Manufacturing (SIC Code 3661) | ||
| # of Employees: | 88 | ||
| Type of Shares: | Ordinary Shares | Filing Date: | 10/18/96 | |
| U.S. Shares: | 1,200,000 | Offer Date: | 5/21/97 | |
| Non-U.S. Shares: | 0 | Filing Range: | $9.00 - $11.00 | |
| Primary Shares: | 1,200,000 | Offer Price: | $6.00 | |
| Secondary Shares: | 0 | Gross Spread: | $0.60 | |
| Offering Amount: | $12,000,000 | Selling: | $0.30 | |
| Expenses: | $1,073,000 | Reallowance: | $0.10 | |
| Shares Out After: | 4,469,270 |
| Manager | Tier | Phone |
| Hampshire Securities Corporation | Lead Manager | (212) 641-3624 |
| Issuer's Law Firm: | Carter, Ledyard & Milborn |
| Bank's Law Firm: | Fulbright & Jaworski |
| Auditor: | Ernst & Young |
| Registrar/Transfer Agent: | Affiliated Stock Transfer Company |
Dollar amounts in U.S. millions except for per share data | |||||
| 6 Month Ending Financials | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 12/31/96 | 12/31/96 | ||||
| Revenue: | $8.65 | Assets: | $10.52 | ||
| Net Income: | $1.42 | Curr Assets: | $6.19 | ||
| EPS: | $0.43 | Liabilities: | $3.98 | ||
| Prior EPS: | $0.28 | Curr Liabilities: | $3.28 | ||
| Cash Flow/Oper: | $1.34 | Equity: | $6.54 | ||
| Cash Flow/Fin: | -$0.06 | Cash: | $0.37 | ||
| Cash Flow/Inv: | -$1.03 | Working Cap: | $2.91 | ||
| Business Description |
| The company designs, develops, markets and supports a comprehensive line of telecommunication management solutions that enable business organizations and other enterprises to more effectively manage their communication resources. The company's products include call accounting and management products, toll fraud detection systems and private branch exchange fault management systems. These products are designed to provide telecommunication and information technology managers with tools to reduce communication costs, recover charges payable by third parties, detect and prevent abuse and misuse of telephone networks, prevent and detect hardware and software faults in telecommunications networks and generate telecommunications usage information for sue in the management of an enterprise. The company was among the first to offer PC-based call accounting systems when it introduced its TABS product in 1985. To date, over 25,000 TABS call accounting systems have been sold to end-users in more than 60 countries. |
| Competition |
| The market for telemanagement products is fragmented and is intensely competitive. Competition in the industry is generally based on product performance, depth of product line, technical support and price. The company competes both with international and local competitors, many of whom have significantly greater financial, technical and marketing resources than the company. The company anticipates continued growth and competition in the telemanagement products market and, consequently, the entrance of new competitors into the market. Existing and potential customers of the company, including business telephone switching system manufacturers and vendors, may be able to develop telemanagement products and services that are as effective as, or more effective or easier to use than those offered by the company. Such existing and potential competitors may also enjoy substantial advantages over the company in terms of research and development channels. Although the company believes that the quality of its products is equal to or better than the product quality of its competitors with regard to performance and reliability, the company has no quantitative data other than the evaluations of its present customers from which to assess its current ability to compete. There can be no assurance that the company will be able to compete successfully against current or future competitors or that competition will not have a material adverse effect on the company's future revenues and, consequently, on the company's business, operating results and financial condition. |
| Business Plan |
| The company's strategy is to maintain and enhance its position as a leading supplier of call accounting and management solutions while expanding its product lines to address the telemanagement needs of the rapidly converging voice, video and data communication markets. Key elements of the company's strategy are: (I) Offer Broad Range of Telemanagement Solutions, (ii) Develop Strategic Relationships, (iii) Offer Billing Solutions for Service Providers, (iv) Maintain and leverage Existing Customer Base and (v) Expand Distributor and Direct Sales Organizations. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used for expansion of sales and marketing activities, research and development, repayment of short term debt, general corporate purposes including working capital and the potential of acquisition of complementary businesses, products or technologies. |
| Name of Shareholder | % Owned Before | % Owned After |
| Chaim Mer | 100.00% | 73.10% |
| C. Mer Industries Ltd. | 100.00% | 73.10% |
| Officer Name | Title | Age |
| Chaim Mer | Chairman of the Board | 48 |
| Eitan Metuki | Chief Financial Officer and Secretary | 44 |
| Zvi Slonimski | President, Chief Executive Officer and Director | 47 |
| Alon Aginsky | Vice President-Marketing and Sales Director | 33 |
| Doron Frenkel | Vice President-Product Development and Director | 33 |
| Additional Underwriter Compensation |
| Additional compensation of $216,000. |
| Warrant to purchase 120,000 shares/units at $120.00 per share/unit. |
| Exercise price of $7.80 for 4 year(s), 1 year(s) from 5/21/97. |