In a bid to accelerate the international expansion of its subsidiary Vmoto, Subiaco-based Optima Corporation Ltd is positioning itself to acquire a major player in the international scooter industry which sources product out of China.
In a bid to accelerate the international expansion of its subsidiary Vmoto, Subiaco-based Optima Corporation Ltd is positioning itself to acquire a major player in the international scooter industry which sources product out of China.
Optima has signed a letter of intent to acquire Freedomotor Company Ltd, an international scooter/motorcycle trading and distribution company.
The deal is forecast to add total revenues of approximately $20 million for the 6 months ended 30 June 2007 and an estimated $50 million for the year ended 30 June 2008, generating NPAT of approximately $1.8 million and $4.1 million respectively.
Freedomotor has an office based in Shanghai and has over 30 clients located in Europe, Australia, North America, South America and South Africa.
Last month, in line with its strategy to foster international opportunities, Vmoto signed a distribution agreement with The Sharaf Group, headquartered in Dubai, United Arab Emirates.
An agreement was reached whereby Sharaf would 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.
At market close, shares in Optima were up 3.8 per cent to 8.3 cents
Below is the full announcement:
Optima Corporation Limited ("Optima" or the "Company") is pleased to announce that it has signed a Letter of Intent ("LOI") to acquire Freedomoter Company Limited ("FMC"), a major player in the international scooter industry, which sources product out of China.
FMC is an international scooter/motorcycle trading and distribution company with a large representative office based in Shanghai. FMC boasts more than 30 major clients located in Europe, Australia, North America, South America and South Africa.
Completion of the acquisition is likely to result an acceleration of the international expansion of Vmoto. Further, the acquisition of FMC is forecast to add total revenues of approximately $20 million for the 6 months ended 30 June 2007 and an estimated $50 million for the year ended 30 June 2008, generating NPAT of approximately $1.8m (6 months) and $4.1m respectively.
It should be noted that these forecasts are indicative only and specific details of the proposed acquisition, including consideration payable, revenues, profits, forecasts and timing will be disclosed to shareholders immediately upon the execution of a formal Sale of Shares Agreement, anticipated to be some time next week.
Optima has provided relevant instructions to its Solicitor to immediately proceed to a formal Sale of Shares Agreement to formalise the LOI. Mr Terry Jones, the Company's Chief Operating Officer, will depart this week to Shanghai to complete the due diligence process.
In the opinion of the Board, the potential acquisition of FMC represents a significant opportunity for the Company and its shareholders and as such, will be pursued with a view to completion by the end of the calendar year.
