IT systems integrator Amnet Ltd has confirmed the details of a major deal with the Chongqing HaiLian College in China to establish a joint venture to own and operate the college.
IT systems integrator Amnet Ltd has confirmed the details of a major deal with the Chongqing HaiLian College in China to establish a joint venture to own and operate the college.
Amnet will pay $10 million to acquire all the college’s fixed assets, but will pay the money through the issue of about 45.5 million shares in itself. The company will also assume an outstanding loan facility on the college’s land, worth about $15.5 million.
Amnet will first consolidate its capital on a one-for-four basis and, in conjunction with the consolidation, raise $2.7 million through the placement of 13.5 million shares at 20 cents each, with one free attaching option for every two shares. The options will have an exercise price of 25 cents and a term of three years.
The additional shares, amounting to 50.4 per cent of Amnet’s issued capital, will then be issued to the college or its principal and owner, Professor Ling Xiao.
In a stock exchange release, Amnet said it would earn $5.1 million in first year revenue from the deal, with EBITDA of $2.7 million. The company also said it was examining whether to apply to list on the Singapore Stock Exchange’s Sesdaq, Singapore’s alternative investment market for small and medium-sized companies.
Amnet chairman Tony Kiernan said many of the company’s shareholders resided in Singapore and Amnet would be an attractive proposition for many other Singaporean investors.
He suggested the Singapore market was extremely interested in companies that had invested in China.
“It’s not a matter of raising money. Singapore has a fairly positive economic focus and outlook with China, and there’s been a fair few political visits, because China needs to come into the Western economy a bit more,” Mr Keirnan said.
“Singapore has taken fairly proactive steps with China, and we thought it would be quite appealing.”
He said Amnet had not yet taken formal steps to list in Singapore, but would do so within the next six to 12 months.
Mr Keirnan acknowledged many in the industry had been surprised that a small Perth company had managed to negotiate a major deal in China, but said China was keen to open its borders to more business from Western nations.
“The Chinese authorities are very keen to encourage foreign investment in education,” Mr Kiernan said.
“Education brings with it an understanding of English. English is not a very common language in China, and now they’ve been admitted to the WTO and people are trying to access the Chinese markets, the Chinese Government understands there’s a need for people to know English and to learn Western ways of doing business.
“What we’ve had to demonstrate to the Chinese is our keenness to become involved in the running of the college, but also in delivering to the college e-commerce courses and in-formation technology, and facilities for those courses to be delivered online.
Mr Kiernan said the Chongqing province in China already had a substantial optic fibre network laid, and the college would be able to access educational institutions in Australia.
He accepted that China’s policy of limiting its citizens’ access to the Internet might become an issue, but said it would be addressed if and when it became necessary to do so.
Amnet will pay $10 million to acquire all the college’s fixed assets, but will pay the money through the issue of about 45.5 million shares in itself. The company will also assume an outstanding loan facility on the college’s land, worth about $15.5 million.
Amnet will first consolidate its capital on a one-for-four basis and, in conjunction with the consolidation, raise $2.7 million through the placement of 13.5 million shares at 20 cents each, with one free attaching option for every two shares. The options will have an exercise price of 25 cents and a term of three years.
The additional shares, amounting to 50.4 per cent of Amnet’s issued capital, will then be issued to the college or its principal and owner, Professor Ling Xiao.
In a stock exchange release, Amnet said it would earn $5.1 million in first year revenue from the deal, with EBITDA of $2.7 million. The company also said it was examining whether to apply to list on the Singapore Stock Exchange’s Sesdaq, Singapore’s alternative investment market for small and medium-sized companies.
Amnet chairman Tony Kiernan said many of the company’s shareholders resided in Singapore and Amnet would be an attractive proposition for many other Singaporean investors.
He suggested the Singapore market was extremely interested in companies that had invested in China.
“It’s not a matter of raising money. Singapore has a fairly positive economic focus and outlook with China, and there’s been a fair few political visits, because China needs to come into the Western economy a bit more,” Mr Keirnan said.
“Singapore has taken fairly proactive steps with China, and we thought it would be quite appealing.”
He said Amnet had not yet taken formal steps to list in Singapore, but would do so within the next six to 12 months.
Mr Keirnan acknowledged many in the industry had been surprised that a small Perth company had managed to negotiate a major deal in China, but said China was keen to open its borders to more business from Western nations.
“The Chinese authorities are very keen to encourage foreign investment in education,” Mr Kiernan said.
“Education brings with it an understanding of English. English is not a very common language in China, and now they’ve been admitted to the WTO and people are trying to access the Chinese markets, the Chinese Government understands there’s a need for people to know English and to learn Western ways of doing business.
“What we’ve had to demonstrate to the Chinese is our keenness to become involved in the running of the college, but also in delivering to the college e-commerce courses and in-formation technology, and facilities for those courses to be delivered online.
Mr Kiernan said the Chongqing province in China already had a substantial optic fibre network laid, and the college would be able to access educational institutions in Australia.
He accepted that China’s policy of limiting its citizens’ access to the Internet might become an issue, but said it would be addressed if and when it became necessary to do so.
