Redline Communications Signs Letters of Intent to Acquire Two Companies

These acquisitions would expand product and service offerings in complementary areas, in line with Redline's growth strategy

TORONTO, June 20, 2013 /CNW/ - Redline Communications (www.rdlcom.com) Group Inc. ("Redline" or the "Company") (TSX: RDL), a leading provider of wireless infrastructure solutions for industrial applications, today announces that it has executed two separate non-binding letters of intent to acquire businesses with specific expertise in wireless communications and integrated solutions based on wireless infrastructure.

One of the targets is a North American provider of communications infrastructure products focused on Energy, Utilities and Public Safety and the other, based in the Middle East, offers fully integrated applications and solutions primarily for the oil and gas industry. Both companies have significant experience selling to large industrial customers which operate in remote regions, the same market addressed by Redline.

Redline provides rugged and secure wide area, high performance wireless networks used by companies and governments which operate in remote areas. These multi-purpose networks are an integral part of ongoing operations, supporting an ever-growing range of mission-critical applications, including machine-to-machine (M2M) applications, voice, and data.

"We have deliberately set out to grow through acquisitions to continue to meet the needs of our global customers," said Eric Melka, Redline's CEO.  "We have been seeking companies which can extend our product line and which can provide additional products, applications, and solutions that will accelerate the use of our networks and drive a faster return on investment to our customers.  These two companies do exactly this."

Redline has a stated growth strategy that is focused on continuously adding value in several ways: expanding each initial network by extending coverage and increasing bandwidth to accommodate growing network use; recreating the network in more of its customers' locations; and enhancing the capability of its customers' networks with the addition of complementary products, services and applications to drive more value from a customer's investment.

"One of our first goals is to reach $100M of profitable revenue as quickly as possible. These types of acquisitions contribute significantly to achieving this goal," added Melka.

Redline has seen significant growth in the energy sector and has recently announced the deployment of large networks in North America, South America and the Middle East, establishing a solid customer base of large industrial companies whose networks need to continue to grow. These acquisitions will accelerate Redline's ability to expand existing customer networks with new products, applications and services.  Additionally, the targets' current customer base will provide new market entry points for Redline products.

The terms of the proposed transactions are confidential but the Company expects to provide additional details, including details on the contemplated closing dates, upon execution of definitive agreements.

About Redline Communications
Redline Communications is the innovator of Virtual Fiber™, a specialized wireless broadband system used by companies and governments worldwide to cost-effectively deploy distributed services and applications.  Redline Virtual Fiber™ solutions are used to facilitate and enhance public safety networks, deploy and extend secure networks, connect digital oilfields and smart grids, and bring dedicated Internet access wherever and whenever it's needed. Redline has been delivering powerful, versatile and reliable wireless systems to governments, the military, oil and gas, and the telecom industry for over a decade through its global network of certified partners. For more information visit www.rdlcom.com.

Forward Looking Statements

Certain statements in this release may constitute forward-looking statements or forward-looking information within the meaning of applicable securities laws.  In some cases, forward-looking statements can be identified by terms such as "could", "expect", "may", "will", "anticipate", "believe", "intend", "estimate", "plan", "potential", "project" or other expressions concerning matters that are not historical facts.  Readers are cautioned not to place undue reliance upon any such forward-looking statements. Such forward-looking statements are not promises or guarantees of future performance and involve both known and unknown risks and uncertainties that may cause the actual results, performance, achievements or developments of Redline to differ materially from the results, performance, achievements or developments expressed or implied by such forward-looking statements. Forward-looking statements, by their nature, are based on certain assumptions regarding expected growth, management's current plans, estimates, projections, beliefs, opinions and business prospects and opportunities (collectively, the "Assumptions").  While the Company considers these Assumptions to be reasonable, based on the information currently available, they may prove to be incorrect.

Many risks, uncertainties and other factors could cause the actual results of Redline to differ materially from the results, performance, achievements or developments expressed or implied by such forward-looking statements. These risks, uncertainties and other factors include but are not limited to the following: significant competition, competitive pricing practices, cautious capital spending by customers, industry consolidations, rapidly changing technologies, evolving industry standards, frequent new product introductions, short product life cycles and other trends and industry characteristics affecting the telecommunications industry; any material, adverse affects on Redline's performance if its expectations regarding market demand for particular products prove to be wrong; any negative developments associated with Redline's suppliers and contract manufacturing agreements including the Company's reliance on certain suppliers for key components; potential penalties, damages or cancelled customer contracts from failure to meet delivery and installation deadlines and any defects or errors in Redline's current or planned products; fluctuations in foreign currency exchange rates; potential higher operational and financial risks associated with Redline's efforts to expand internationally; a failure to protect Redline's intellectual property rights, or any adverse judgments or settlements arising out of disputes regarding intellectual property; changes in regulation of the wireless industry or other aspects of the industry; any failure to successfully operate or integrate strategic acquisitions, or failure to consummate or succeed with strategic alliances; and Redline's potential inability to attract or retain the personnel necessary to achieve its business objectives or to maintain an effective risk management strategy (collectively, the "Risks").

For additional information on these Risks, see Redline's most recently filed Annual Information Form ("AIF") and Annual MD&A, which are available on SEDAR at www.sedar.com and on the Company's website at www.redlinecommunications.com. Redline assumes no obligation to update or revise any forward-looking statements or forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by law. All forward looking statements contained in this release are expressly qualified in their entirety by this cautionary statement.

SOURCE: Redline Communications Group Inc.

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