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R-2000 TERMINATES ACQUISITION AGREEMENT WITH WESTERN RESERVE; AGREES TO ACQUIRE OB SYSTEMS

 R-2000 TERMINATES ACQUISITION AGREEMENT WITH WESTERN RESERVE;
 AGREES TO ACQUIRE OB SYSTEMS
 NEPTUNE, N.J., May 8 /PRNewswire/ -- R-2000 Corporation (NASDAQ: RTWOC), today announced that its definitive agreement to acquire Western Reserve Manufacturing Company has been terminated. Due to a confidentiality provision in the agreement, the company is unable to disclose details. R-2000 expects to reenter negotiations seeking to acquire Western Reserve later this year.
 R-2000 also announced that it has reached an agreement in principle to acquire OB Systems and Mining, Incorporated, of Huntington, W. Va. OB Systems is a manufacturer of electrical products and systems for the mining industry and power substations principally used in mass transportation systems. Terms of the proposed acquisition were not announced. The acquisition is expected to be completed by the end of 1992.
 It is expected that definitive agreements will provide for the immediate infusion of up to $500,000 of working capital into OB Systems by R-2000, followed by the purchase of OB's discounted senior debt on or before Dec. 31, 1992.
 Lawrence B. Adams, chairman of R-2000, stated, "OB Systems has suffered greatly under excessive debt. We feel the infusion of working capital and the significant restructuring of its debt can return OB to profitability quickly and restore its market share. We look forward to participating in the future growth of this 100-year old company."
 For fiscal 1989 and 1990, OB's sales were in excess of $12 million with operating income of $800,000 and $1,222,000 respectively. Limitations on working capital and a heavy debt burden resulted in 1991 sales declining to $6,291,000 with operating profit of $144,000.
 "We feel that, as structured, the transaction will return OB Systems to the sales and profit levels it enjoyed in prior years," Adams said.
 R-2000 Corporation is engaged primarily in the manufacture of high precision parts and machinery components and the sale of bronze and bronze products.
 -0- 5/8/92
 /CONTACT: Lawrence B. Adams, chief executive officer of R-2000, 908-938-7797/
 (RTWOC) CO: R-2000 Corporation ST: New Jersey IN: SU: TNM


TQ-OS -- NY065 -- 8212 05/08/92 15:55 EDT
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Publication:PR Newswire
Date:May 8, 1992
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