In line with its strategy to foster international opportunities, Vmoto has signed a distribution agreement with The Sharaf Group, headquartered in Dubai, United Arab Emirates.
In line with its strategy to foster international opportunities, Vmoto has signed a distribution agreement with The Sharaf Group, headquartered in Dubai, United Arab Emirates.
An agreement has been reached whereby Sharaf will have exclusive distribution rights of the Chinese-built Vmoto in the UAE, with a 12-month option to become master distributor for the Middle East, servicing 13 countries. The agreement is valued at $4.2 million, in the event that the Sharaf exercises ITS option of the remaining 13 countries.
A subsidiary of Subiaco-based Optima Corporation Ltd, Vmoto is breaking new ground with the deal.
Vmoto founder and Optima director, Patrick Davin, told WA Business News the deal represented the further expansion of Vmoto into the international marketplace following on from its distributorships in the US and New Zealand.
“At the moment, there is no scooter market in the Middle East,” he said.
“The deal is for around 3,500 to 4,000 units and Sharaf are planning to open the first dealership in Dubai in late December.
“If this goes well they will be looking at opening further dealerships.”
Sharaf has made an initial order of three containers valued at $141,000. The order coincides with a national product launch campaign commencing in January 2007.
Vmoto represents the first brand secured by the newest addition to the Sharaf group of companies, Sharaf Automotive Division.
Optima managing director Blair Sergeant said the company, which has 65 dealers throughout Australia, would also look towards further expansion into the US where it currently has three dealers in the state of Maryland.
“The US is a potentially very large market for us and we have received interest from possible distributors in California and Miami,” he said.
“There are 120,000 Vmoto scooters there compared with 12,000 in Australia, so even just a small percentage increase and we could double our sales.”
Last month, Vmoto signed an agreement with a distributor in New Zealand looking to grow Vmoto’s presence through the appointment of new dealers, one of which has been appointed in Christchurch.
The company is aiming to release two new models – the Montego and Matrix – onto the New Zealand market at the start of next year following on from their recent release in Australia.
Vmoto also released its own branded Visa card this year, to be issued at dealerships and used to fund scooter and accessory purchases.
In June, Optima acquired the wholesale operations of Vmoto for $4.5 million. Under the transaction, Optima issued 60 million fully-paid shares at 7.5 cents each to acquire Capital Pacific Pty Ltd, the owner of the Vmoto brand.
Capital Pacific distributed the Vmoto scooters, motorcycles and All-Terrain Vehicles (ATV) to retail distributorships in Australia, the US and New Zealand.
The acquisition added another core business to Optima, which also owns a 10-year licence to manufacture, market and distribute the wet suit brand, West, and a fivey-year licence to distribute in the US its surf accessory brand Creatures of Leisure.
The Optima board is currently completing a strategic review of the West and Creatures businesses in the US, and as part of that process will consider the viability of the businesses.
The Sharaf group, established in 1976, has operations in more than 20 countries, spanning the Middle East, Africa, India and China.
The group has diversified into businesses including shipping, retail fashion, retail electronics, cargo, logistics, financial services, real estate, warehousing and logistics and travel and tourism.
