South Perth-based bamboo flooring products company Style Ltd will acquire the remaining 50 per cent of manufacturing joint venture Anji Ya Feng Bamboo Products Ltd in a cash and scrip deal worth around $7.3 million.
South Perth-based bamboo flooring products company Style Ltd will acquire the remaining 50 per cent of manufacturing joint venture Anji Ya Feng Bamboo Products Ltd in a cash and scrip deal worth around $7.3 million.
The full text of a company announcement is pasted below
The Board of Style Limited (Style) is very pleased to announce today the signing of an agreement to acquire the remaining 50% of shares in Anji Ya Feng Bamboo Products Limited (AYF), the manufacturing Joint Venture, from Anji Tianfeng Bamboo Wood Co. Ltd (ATBW). The acquisition consolidates 100% ownership of AYF under Style Limited.
The acquisition is earnings accretive and can be completed using Style's existing cash reserves. The acquisition removes Outside Equity Interest (OEI) deductions from Style Group's Consolidated Accounts going forward.
The acquisition includes all cash, stock, work in progress, additional IP, and plant & equipment.
The key terms of the transaction are:
Cash Consideration USD 2.5m - Payable on 30th June
Share Consideration 6,552,222 units - Equivalent to USD 3.5m
TOTAL PAYABLE USD 6.0m - in cash and shares
Importantly, Joint Venture partner Mr Jian Hua Li, current General Manager of AYF, will continue as General Manager of AYF, the now wholly owned manufacturing division of Style.
The key terms of Mr Jian Hua Li's contract are:
Contract life 10 years commitment to Style Limited
Structure Base plus Bonus and Incentives tied to Manufacturing
Benchmarks and Product Quality Control
The acquisition has been facilitated by many years of goodwill between the Joint Venture parties and significantly, the terms of the acquisition ensure an alignment of interests and continuing goodwill through management and ownership for at least the next 10 years.
The transaction has the full support of both Joint Venture partners and relevant authorities.
The Managing Director of ATBW and major shareholder Mr Jian Hua Li commented, "This is a great milestone in the relationship between the Joint Venture parties. My personal commitment to move forward together as one Company and part of the greater Style Group is testament to the leadership shown by Style's Chairman Greg Johnson and his Board and Management in achieving our joint
objective of building a world leading manufacturing facility of innovative and renewable products. My 10 year commitment to the Group is a result of my ongoing confidence in Style Limited and my partnership with Greg and his team in the past and going forward into years to come."
The Chairman and CEO of Style Mr Greg Johnson commented, "Jian Li has shown great technical leadership and ingenuity in building both AYF and his Company ATBW in China and across the industry globally. Jian and ATBW have demonstrated professionalism, passion and commitment to Style's products and high quality standards throughout his management of the product manufacturing process and we are proud that the goodwill generated through our decade long partnership in China on manufacturing has resulted in this further strengthening of the relationship into the one Company, Style Limited. We welcome ATBW and its majority shareholder Jian Li as a significant shareholder onto the Style Limited share registry and also welcome his continued commitment and involvement in the leadership of the manufacturing division of Style going forward."
The acquisition is subject to shareholders approving the issue of the equity to ATBW shareholders at an Extraordinary General Meeting of Style Limited. Key dates of the meeting will be issued to shareholders shortly.
Today's announcement is a major milestone in Style's objective to be a global leader in the manufacture and supply of world class renewable products and now positions all Style stakeholders to take full advantage of the continuing rapid growth anticipated for Style and its current and future products in the months ahead.
