Sidetrack Permanently Distracted?

Gail Chiasson, North American Editor

It seems a rather strange situation, with no sign of Sidetrack Technologies, and Bassett Media Group Corp. executives proving elusive.

Yet it appears that a sale is still in the works.

It was back in early September that we wrote that Bassett Media Group, advertising display holding company, was planning to take over Winnipeg-based Sidetrack for $3 million less assumed liabilities.

Sidetrack, which provides – or provided – full-motion advertising display systems in rail and subway tunnels in San Francisco, Los Angeles, London, Mexico City, Monterrey and Rio de Janeiro, subsequently seems to have disappeared, with no Web site nor working phone number.

However, Bassett is still pursuing the acquisition, according to Mark Lawson, vice-president at Bassett, taking its time to do ‘due diligence’ and to “do it right.” Obviously reluctant to talk, he would give no time frame for future decisions.

In the meantime, we’ve noticed that, in October, Bassette also signed a letter of intent with respect to the proposed acquisition of all outstanding shares of Haizou Media Corporation, China, for an initial purchase price of $5 million payable through the issuance of common shares of Bassett Media to the shareholders of HMedia. (The vendors may be entitled to receive an additional earn out payment of up to $2 million, payable in Bassett Media shares at an ascribed price of $0.22 per share, if HMedia meets certain earnings and EBITDA performance targets during fiscal 2010.)

Formed in 2006, HMedia owns and operates over 50,000 advertising display screens strategically located in high-traffic neighbourhoods across 20 cities in China with an estimated reach of approximately 20 million consumers daily. This, too, is based on certain conditions being met and completion of due diligence.

We’re watching both moves with interest.

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