AFS Technologies, Inc. Completes The Acquisition Of Distribution Management Systems, Inc.

AFS Closes a $5.0 Million Financing with Merion Investment Partners, L.P.

Phoenix, AZ - AFS Technologies, Inc. (AFS), a provider of software solutions to the food industry, announced that it had completed the acquisition of Distribution Management Systems, Inc. (DMS), a Milford, CT-based provider of software solutions to the food and beverage industries, for cash and stock. With the acquisition, AFS now serves over 230 customers, will employ over 100 professionals, and will be headquartered in Phoenix, with an east coast office in Milford, CT and a development facility in Bangalore, India.

AFS also announced that it had closed a $5.0 million financing, comprised of mezzanine and equity capital, provided by Merion Investment Partners, L.P., a King of Prussia, PA-based mezzanine capital firm. A portion of the proceeds was used to facilitate the acquisition of DMS, and the remaining will be used for working capital purposes and possible further acquisitions. The Argentum Group ("Argentum"), a New York-based private equity firm, and AFS's majority shareholder, played an integral role in facilitating these transactions.

"I am very pleased with the acquisition of DMS as both companies complement each other well, in that AFS brings a substantial capital investment in the development of its .NET framework and DMS's management brings deep domain expertise in market segments that are new to AFS. Thus, DMS's customers will be offered broader product offerings on a leading edge technology platform, and more process oriented product development and customer support, ensuring high quality deployments," said Kurien Jacob, AFS's CEO. "AFS now offers to the food and beverage industries the only solution that provides a complete suite of fully integrated software applications, utilizing a database independent design and a Service Oriented Architecture (SOA)," Jacob added.

"Merion is excited to have the opportunity to support the growth of AFS," said William Means, Managing Partner, Merion Investment Partners, L.P. "We believe the company has an excellent management team and the best enterprise software solution for the food and beverage industries."

"Our vision is to build a company that will become the premier software solutions provider to the food and beverage industries; and the acquisition of DMS clearly provides the scale needed, and will position AFS firmly on that path," said Walter Barandiaran, Chairman of AFS and a Managing Partner of Argentum.

SOURCE: AFS Technologies, Inc.