HOME > NEWS RELEASES > 2008 NEWS RELEASES > November 10, 2008

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Alanco Investor Relations
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Alanco's StarTrak Announces Expansion Into
Construction Equipment Monitoring Market
via Acquisition of MicroLogic, Inc.

Scottsdale, AZ – November 10, 2008 – Alanco Technologies, Inc (NASDAQ: ALAN) announced today that its StarTrak Systems subsidiary, the leader in transport refrigeration tracking, monitoring, and control systems, has entered the emerging market for wireless tracking and monitoring services to the construction equipment industry through the acquisition of the assets of MicroLogic, Inc., located in Lowell, Massachusetts.

Founded over 25 years ago, MicroLogic is most notable for its technical development of the LoJack™ Stolen Vehicle Recovery System and the engineering of the LifeLine™ Personal Emergency Response System. More recently, MicroLogic began offering wireless solutions to address a number of operational and asset management challenges in the construction industry, entering into the emerging market for wireless tracking and monitoring of construction equipment assets, such as towable generators, excavators, bulldozers, backhoes, rock drills and cranes. The company currently provides data services to about 25 customers, tracking and monitoring over 1,000 construction equipment assets, principally in the Eastern United States.

The MicroLogic business model is recurring revenue driven, similar to StarTrak’s, in that an initial sale and installation of a transponder unit on an asset is followed by a monthly recurring subscription payment plan for monitoring data services. The customer value proposition related to MicroLogic’s data services includes increased revenues for equipment rental companies through maximized asset utilization, and decreased operating costs through improved maintenance and fuel savings. Although current market penetration for monitoring construction equipment is minimal, the potential addressable U.S. market is estimated to exceed 1,000,000 assets, which would translate to initial hardware sales of about $750,000,000 and annual data service revenues in the range of $300,000,000. The competition is currently highly fragmented with no clear leader.

Robert R. Kauffman, Alanco Chairman & CEO, commented, “The MicroLogic acquisition presented a unique opportunity to greatly expand StarTrak’s long-term market potential for a nominal all-stock investment. The transaction is expected to be immediately cash positive based on existing MicroLogic annual service revenues of about $400,000. The MicroLogic business is highly complementary to StarTrak’s refrigeration transport monitoring technology and operations, and will be integrated within the existing organization with the addition of only MicroLogic’s present sales manager and a systems engineer. Current MicroLogic data services will be moved to StarTrak’s lower cost, more robust network, which should improve service reliability and overall performance. We are confident that StarTrak can significantly improve upon the current MicroLogic product offering, and greatly accelerate penetration of this early stage market opportunity.”

Alanco Technologies, Inc. (NASDAQ: ALAN), headquartered in Scottsdale, Arizona, is a rapidly growing provider of wireless tracking and asset management solutions through its StarTrak Systems and Alanco/TSI PRISM subsidiaries. Corporate website: www.alanco.com

StarTrak Systems is a leading provider of GPS tracking and wireless asset management services to the transportation industry and the dominant provider of tracking, monitoring and two-way control services to the refrigerated or “Reefer” segment of the transportation marketplace, including refrigerated trailers, trucks, railcars, and containers. StarTrak products increase efficiency and reduce costs of the refrigerated supply chain through the wireless monitoring and control of critical Reefer data, including GPS location, cargo temperatures and Reefer fuel levels. Additional information is available at www.StarTrak.com.

Alanco/TSI PRISM is the leading provider of RFID real-time tracking technologies for the corrections industry. TSI PRISM systems track and record the location and movement of inmates and officers, resulting in enhanced facility safety and security and significant staff productivity improvements. Utilizing proprietary RFID (Radio Frequency Identification) tracking technology, TSI PRISM provides real-time inmate and officer identification, location and tracking both indoors and out, and is currently utilized in prisons in Michigan, California, Illinois, Ohio, Missouri, Virginia, Indiana, and Minnesota. Additional information is available at www.TSIPRISM.com.

The Company also participates in the data storage industry through its wholly owned subsidiary, Excel Meridian Data, Inc. (EMD), which specializes in providing unique data storage, backup and disaster recovery solutions. EMD storage product lines include: direct attached storage (DAS), network attached storage (NAS) and storage area network (SAN) solutions for any size business. In addition, EMD features partnerships with: EqualLogic, VMware, Microsoft, DoubleTake and other industry leading hardware and software solution providers. For more information visit: www.emdstorage.com

Except for historical information, the statements contained in this press release are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All such forward-looking statements are subject to, and are qualified by, risks and uncertainties that could cause actual results to differ materially from those expressed or implied by those statements. These risks and uncertainties include, but are not limited to, reduced demand for information technology equipment; competitive pricing and difficulty managing product costs; development of new technologies which make the Company’s products obsolete; rapid industry changes; failure of an acquired business to further the Company’s strategies; the ability to maintain satisfactory relationships with lenders and to remain in compliance with financial loan covenants and other requirements under current banking agreements; and the ability to secure and maintain key contracts and relationships.

 


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