ECSI reaps Hyundai Syscomm partnership
CLIFTON, N.J.--Even as a yearly report announced a 50 percent decline in revenues for the fourth quarter of 2006, as compared to the same time period in 2005, Electronic Control Security's stated plan to focus on the public sector rather than government appeared to be paying dividends. An announced agreement with wireless telco integrator Hyundai Syscomm will lead to $25 million worth of purchase orders for the period of time ending June 30, 2008, which would represent a significant increase in revenues.
Already, in mid-February, ECSI received a purchase order for $6 million. Further, Hyundai purchased 4.8 million shares of ECSI stock for $1.2 million--to be used by ECSI to eliminate debt--and has a warrant to purchase further shares should gross profit from the purchase orders provided by Hyundai meet a certain standard.
Arthur Barchenko, president and chief executive of Electronic Control, said he was approached by Hyundai Syscomm, a Southeast Asia-based company with U.S. offices in Southern California and Washington, D.C., along with bases in China, Hong Kong and Seoul. "Based on our experience in both the security and infrastructure relating to pipeline and port security," said Barchenko, "and our relationships with the Department of Defense and Department of Energy, they felt we would be a good strategic partner."
"We found that many Asian companies are highly receptive to [ECSI's] solutions," said Jack Choe, a corporate development officer with Hyundai Syscomm. "And it has a manufacturing capability, too, which is rare in this industry." In exchange, Hyundai provides ECSI a new foray into Southeast Asia, starting with a project in Malaysia.
"They discovered that the IT security directors are playing a more important role in the physical security of these assets of the major corporate entities," reasoned Barchenko."