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COGNITRONICS WILL SELL OPTICAL SCANNING AND IMAGE PROCESSING LINE TO ITS FOUNDER; COMPANY WILL CONCENTRATE ON VOICE PROCESSING

COGNITRONICS WILL SELL OPTICAL SCANNING AND IMAGE PROCESSING LINE
 TO ITS FOUNDER; COMPANY WILL CONCENTRATE ON VOICE PROCESSING
 STAMFORD, Conn., Dec. 19 /PRNewswire/ -- Cognitronics Corporation (AMEX: CGN) said today it is selling its optical scanning and image processing product line in order to concentrate on the manufacture and sale of voice processing products, by far the largest sector of the business.
 The buyer is David H. Shepard, founder, board chairman, and senior vice president of Cognitronics. Upon completion of the transaction, Shepard will retire as an officer of the company, remaining as a director on its board.
 The transaction, in which Shepard will exchange shares of Cognitronics' common stock for the product line, was approved today by all of the disinterested directors.
 Cognitronics, which reported nine months revenues totaling $12.9 million, noted that the product line being sold will account for approximately 11 percent of total 1991 revenues.
 As a result of this restructuring, the company will record a one-time, after-tax charge in the fourth quarter estimated not to exceed $350,000, or $.16 per share.
 "This restructuring advances our corporate strategy of concentrating on all aspects of the voice processing industry," said Matthew J. Flanigan, president and chief executive officer.
 "Next year, we will step up our commitment to voice processing, already our largest and most profitable line, by increasing our research and development budget and adding to our sales staff.
 "Industry analysts forecast that interactive voice response (IVR), a segment of the overall voice processing industry, will nearly quadruple in size to $1.6 billion by 1995," he said, adding that "we are positioning ourselves to be a leading supplier in that market which has great long-term growth potential for us."
 He noted that the company will now focus on three areas: increased end-user sales to telephone operating companies; increased sales to telephone switch manufacturers, and a new sales target -- the commercial IVR and audiotex markets.
 Cognitronics is a leading manufacturer and supplier of voice processing equipment, including telephone network announcement products and interactive (IVR) systems to telephone operating companies, original equipment manufacturers and commercial users. Cognitronics also manufactures precision machined parts and electro-mechanical assemblies.
 -0- 12/19/91
 /CONTACT: Harold F. Mayer, vice president of Cognitronics, 203-327-5307/
 (CGN) CO: Cognitronics Corporation ST: Connecticut IN: TLS SU: TNM FC -- NY075 -- 4062 12/19/91 16:06 EST
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Copyright 1991 Gale, Cengage Learning. All rights reserved.

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Publication:PR Newswire
Date:Dec 19, 1991
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