Tuesday 9th May 2017 |
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Energy Mad, the energy efficient light bulb maker and marketer, has entered an agreement relating to the sale and purchase of its assets with a proposed settlement date of Nov. 17.
The Christchurch-based company said the purchaser, Ecobulb, is associated with Chris Mardon, a former director and current employee at Energy Mad. On the settlement date, Ecobulb will pay the purchase price in cash and in full to the vendors, it said. Both Mardon, who is currently general manager of marketing, and Alireza Milani, technical manager for Energy Mad, have been offered employment with the purchaser.
No price was specified but it does include the delivered into store cost of the remaining core stock at the settlement data, including the purchase price from the manufacturer and the cost incurred to get that remaining core stock from China into store in Melbourne.
Chairman Brent Wheeler told BusinessDesk that given the agreement involves selling down some inventory, it means the actual price is "a bit of a moving feast." Energy Mad underscored the deal is only a potential sale of the assets and the assumption of assumed liabilities as there are a series of conditions to be satisfied.
Conditions include obtaining shareholder approval. Among its 768 shareholders, SuperLife, the funds management business owned by NZX, this year swapped 2.25 million convertible notes for just under 70 million shares in Energy Mad, giving it 71.4 percent of the energy efficient lightbulb marketer.
A SuperLife spokesperson said the fund "will vote consistent with our policy, which states that we will vote when we consider that not voting will have a material adverse effect on investors." When it votes it will "assess the proposal once all the relevant information has been provided, and will vote in the best interests of our members."
According to Wheeler, the company's directors are on board. "They obviously passed it and resolved to do it, so they support it," he said. The next step is to obtain a special resolution from shareholders, he said. "There will be a full shareholder meeting" and the company's value will be appraised. The directors will then review that and state their conclusions, he said.
Energy Mad said the initial agency arrangement is for the sale of its stock by the purchaser and the potential sale and purchases of assets owned and used by Energy Mad's business, which is primarily stock and intellectual property.
It excludes cash on hand, trade debtors and rights under any contract of insurance. However, it does include the assumption of specific liabilities, which are obligations between Energy Mad and My Eco and all customer service obligations.
Energy Mad raised $5 million selling shares for $1 each in its 2011 initial public offering. The shares last traded at 1.6 cents apiece, valuing it at $1.2 million.
(BusinessDesk)
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