Allied Defense agrees to $1.65 million subsidiary sale, closes on $10 million convertible restructuring loan

By Caroline Salls

Pittsburgh, July 25 - The Allied Defense Group, Inc. has agreed to sell the assets of its Poway, Calif., SeaSpace Corp. subsidiary to Acetopia Holdings for $1.65 million, according to a company news release.

"This transaction is an important step in the execution of our ongoing business plan, eliminating losing business operations and delivering enhanced, long-term value to our shareholders," Allied Defense president and chief executive officer John J. Marcello said in the release.

In addition, the company said it has closed on an additional $10 million of financing in conjunction with the previously announced restructuring of its senior convertible notes.

Allied Defense said the $10 million of additional financing became available once a substantial ammunition contract was received by its AWE segment.

With this additional closing, the company said it has a total of $15.3 million of new financing in place.

"This new facility will provide us with an increase in working capital and liquidity, which will fund MECAR's operation as it relates to our recent contract and should be a catalyst for future growth," Marcello said in the release.

"We continue to execute our strategic plan to re-focus and re-energize all of the operating units within the company and look forward to reporting progress towards those goals throughout the balance of 2007, into 2008 and beyond," he said.

Based in Vienna, Va., Allied Defense develops ammunition for defense departments and produces electronic and microwave security systems.

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