Mace parts with car washes
FORT LAUDERDALE, Fla.--Mace Security International began, in the first quarter of 2006, to make good on its stated promise of unloading its car wash division. In January, the company, which also manufactures personal defense and CCTV products, sold a West Chester, Penn., car wash for $400,000 and leased its truck-washing business to Eagle United Truck Wash for $9,000 per month and an agreement to buy the company within two years for $1,200,000.
In March, Mace agreed to sell its Arizona Car Wash Region, consisting of nine owned and three leased locations, representing $10 million in 2005 revenues, to CW Acquisition for $18.5 million in cash and $1 million in the form of a three-year promissory note.
Eduardo Nieves, vice president of marketing and investor relations at Mace, said that as much as $2 million in cash from the sale "will be on hand for acquisitions or business development or marketing efforts." Mace, traded on NASDAQ, hadn't yet released year-end numbers at press time, but at their nine-month end report the company had $12 million in cash on hand.
It's possible that Mace now has extra motivation to rid itself of its profitable car washes. In March, four of its East Coast car washes were visited by federal agents, who arrested 57 workers on illegal immigration charges. Later, agents subpoenaed files from Mace's former headquarters in Mount Laurel, N.J. No charges have been filed against Mace.
"On March 28, 2006, the [Mace's] Audit Committee retained independent outside counsel to conduct an independent investigation" into the matter the company wrote in an 8k filing to the SEC. Mace anticipates a report on or before April 12, 2006."
Nieves said Mace hopes to take the proceeds of the car-wash sales and invest further in its security business, through acquisitions - "our management team [members] are experts in acquisitions," he said - and research and development centered around its camera and DVR lines.