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Monday 21st June 2010 |
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Amphibious boat-maker Sealegs will use a $6.2 million injection of new capital from Mauritius-based Avenport Investment to invest in building a global brand, chief executive David McKee Wright told BusinessWire today.
Sealegs announced to the NZX that Avenport, which has already built a 19.9% stake in Sealegs, will become a 39.9% shareholder, assuming shareholder approval for the issue of 31 million new shares for 20 cents apiece at the Sealegs annual meeting on July 30.
The Sealegs board has commissioned an independent appraisers report on the offer, for release to shareholders, and the offer price is based on the 30-day average closing share price at June 15. Sealegs shares were trading unchanged at 23 cents today.
Avenport is expected to seek at least one seat on the Sealegs board, with McKee Wright signalling a board peer review after the annual meeting to ensure it had the right mix of skills for the next phase of its growth.
Strategic expansion of Sealegs would require significant working capital and Avenport shared the same vision for Sealegs as management, the company said in its NZX statement.
McKee Wright said Sealegs had come a long way since first having the amphibious boat concept in 2004, and with 500 boats now sold in 25 countries, the company was well-placed to invest in global expansion.
"We've proved the market exists; we've had the patents issued. If there was ever a time to invest in a global brand, it's now," he said.
The company was criticised last year by Fisher Funds principal, Carmel Fisher, for not pressing more urgently for global growth.
Avenport had operations in France, the UK and Qatar and was familiar with the Sealegs product from those markets, said McKee Wright.
“Avenport will bring an international focus to the company and the capital from the placement will fund marketing, sales initiatives and the development of new models."
McKee Wright is the next largest shareholder in Sealegs, with a 10% stake, and interests associated with the company's founders own a total of around 30%, including McKee Wright's shares.
Sealegs announced a $642,000 operating profit on sales of $11.4m for the year ending March 31 2010.
Businesswire.co.nz
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