LONDON (Alliance News) - Alpha Returns Group PLC Monday said its Shidu International Ltd unit has signed a deal to buy 30% of Oriental Ventures, a special purpose vehicle formed to acquire China-based start-up coffee chain Shenzhen MaxLife Catering Management Ltd, for USD1.5 million in cash and shares.
In a statement, the investing company in Asian assets said MaxLife opened its first in Dongmen, a major shopping district in Shenzhen, China in December 2013. It is intending to open two more outlets, with financing from the Vendor, prior to moving onto a franchise model with a target of 300 stores across China.
Alpha Returns will pay HKD5.8 million in cash on execution of the deal and then issue 32.1 million new Alpha shares at 1.4 pence a share to satisfy the balance on completion, which is expected to take place nine months after the execution. The new shares represent nearly 5.7% of Alpha's current share issue.
Alpha also has an option to buy a further 15% stake in Oriental Ventures over the three years after completion.
"The directors have initiated three cornerstone investments in the Asia Pacific region to date, and we shall now focus on the next phase of development for the company which is to complete and develop those investments to their fullest potential through active engagement with management," Alpha Returns Director Christopher Neo said in a statement.
Alpha Returns shares were up 4% at 1.95 pence Monday.
By Steve McGrath; stevemcgrath@alliancenews.com; @stevemcgrath1
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