A bus in Saint John, New Brunswick equipped with Webtech Wireless’s NextBus wireless solution. Webtech sold the NextBus division today for $20.75-million. After a brief halt this morning, Webtech Wireless (TSX:WEW) grabbed headlines on the TSX.
WebTech announced it has closed the sale of its NextBus division for $20.75-million to Cubic Transportation Systems Inc., a division of Cubic Corp. The agreement has a provision that says Webtech will continue to provide hardware and certain services to its former California-based subsidiary.
Webtech CFO Andrew Morden said the company’s brief flirtation with NextBus did provide value for investors.
“When we acquired the NextBus business in 2009, we believed it was a jewel in the rough with the potential to produce superior operating results, which would ultimately have significant value as a stand-alone business. Today’s announcement demonstrates that we have delivered on the value we saw,” he said.. “I would like to personally thank Michael Smith at NextBus for his hard work and leadership and to wish him and his team well as they join the Cubic organization.”
Vancouver’s Webtech Wireless, which was founded 1999, spiked to $7 in April of 2007 on the promise that its GPS tracking of transit and commercial fleets could bring measurable cost reductions for large customers. But the company’s shares have languished in the time since, as losses piled up and patent disputes made investors jittery.
Webtech’s “predictive arrival” segment, which included revenue from NextBus, generated $2.37-million, or 26% of the company’s total topline in Q3, 2012, which ended September 30th of last year.
At press time, shares of Webtech Wireless were up 13.7% to $.29.