Wednesday, 23 February 2011

Ottawa Backs AMA With Nearly $2 million

AeroMechanical Services Ltd. (TSX:V-AMA)
Basic Shares: 118.58 million
Fully Diluted: 134.33 million


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Ottawa announced on February 23rd it was backing AeroMechanical's $6.5 million development costs on its next generation blue box - the afirs 228 - with a repayable investment of $1.96 million.

At the press conference in AeroMechanical's Calgary boardroom, the Minister of State (Transport), Rob Merrifield, said the investment will create jobs and keep Canada on the cutting edge of aerospace technology.

He also said the announcement was timely in that it was coming on Canada's National Aviation Day.

"On behalf of the Government of Canada, I am pleased to announce this investment in one of Alberta's most promising aerospace firms," Mr. Merrifield said.

The afirs 228 has been 13 years in development, given the earlier lessons learned in creating the first series of blue boxes.

And it gave AMA Chairman and CEO, Bill Tempany, some crowing room when he stated:

"Our patented on-board system is the only product in the world that has the demonstrated capability to transmit all of the black box data and continuous position information to the ground in real time (and) on demand."

In other words, this could end the pressing need to find an aircraft's black box because the data in it could already be transmitted by the afirs 228 and housed safely in ground stations.

The other critical feature of the next-generation technology is the ability airlines will have in using the afirs 228 to become instantly compliant with new European Union regulations governing aircraft-to-ground communications that are scheduled to take force soon.

Under the investment agreement, AMA will start paying the funds back on April 3oth, 2014 and continue payments for the next 15 years. Under a complicated formula, it works out to an approximate interest rate of about 4.62% per year.

To read the press release, please click here...........