OSI Buys Mapcon Mapping Consultants

Friday, March 11, 2005
Offshore Systems International Ltd. announced it has entered into an agreement to purchase all of the issued and outstanding shares of Mapcon Mapping Consultants Inc. of Salt Lake City, Utah. Mapcon is a land mapping company with a solid position in the U.S. geomatics (digital map and electronic chart data production) market.

Under the terms of the agreement, OSI will purchase all of the shares of Mapcon from its shareholders for cash of US$950,000 and the issuance of US$50,000 in common shares of OSI at market price. The purchase is subject to a number of conditions, including the execution of a definitive agreement. The transaction is expected to close within thirty days. The issuance of the shares by OSI to the Mapcon shareholders is subject to acceptance by the TSX.

"This is a strategic opportunity to enhance and grow our position in the fast-growing U.S. market," said John Jacobson, OSI president and CEO. "It represents a significant step forward for our Company."

Based on industry data and market studies, OSI estimates the North American mapping market (both land and marine) is approximately US$500 million annually. Mapcon will be well situated to grow market share, as Utah currently ranks third highest for population growth rate in the United States. Population growth, with its attendant infrastructure needs, is a key driver of geomatics demand, including for precision land-based mapping products and services.

"Mapcon represents an excellent strategic fit with OSI's Geomatics business unit," said Jacobson. "Combined, we offer close to 200 years of technical and management experience, a substantial customer base, an extensive product and service offering, and a track record of positive revenues and profitability." The two entities also already have a well established business relationship, having successfully partnered on several previous projects. "It's important to OSI's future growth to obtain a foothold in the U.S.," said Jacobson. "With the purchase of Mapcon Mapping, I am very pleased to be accelerating our Company's strategic expansion."

The Company's Geomatics business unit represented approximately 22 per cent of OSI's revenue in fiscal 2004. Customers include the US Coast Guard, National Oceanic and Atmospheric Administration, city/county/state governments, and engineering companies.

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