By CHRIS BARTON and LIBBY MIDDLEBROOK
Former mining exploration company Spectrum Resources has begun its e-commerce makeover with a $2 million acquisition of WEL Technology - the software development arm of WEL Energy Group.
The $2 million deal in cash and Spectrum shares will decrease if WEL Technology does not finalise a
software source code agreement with an unnamed international software company at present under due diligence.
Hamilton-based WEL Technology has been selling its PV2 electricity billing product into the North American utility market through a partnership with United States-based software vendor JD Edwards.
In August, the company formed a joint venture with Ontario software developer and contract meter reading company Proson Solutions and Ontario's Municipal Electricity Association to develop and sell a modified version on PV2.
WEL Technology also has a strategic alliance with German-based software giant SAP to integrate PV2 and SAP's R/3 software for the Australian and New Zealand utility marketplace.
The chief executive of WEL Technology, John O'Hara, who also founded internet provider Voyager New Zealand, has been appointed head of Spectrum and plans to concentrate the business on newly deregulated offshore electricity markets in Canada and the United States.
The chief executive of WEL Energy Group, Mike Underhill, said the company opted to sell its technology division after it refocused on the lines electricity business rather than electricity retailing.
"There's been a primary move away from our core business into the lines business, as a consequence it is an entirely sensible thing for us to do."
Spectrum also announced plans to issue existing shareholders a bonus of one option for every six shares held exercisable at 20c on or before 30 January 2001. Spectrum, which was trading yesterday at 38c, has seen its share price surge from 10c in December when it announced its moves into e-commerce.
Spectrum also plans to have a rights issue to raise approximately $10.15 million. Rights will be issued at a ratio of seven new shares for three existing shares at 5c a share. For each six new shares taken up, subscribers will be entitled to a free bonus option.
