undervalued update..20 Feb 2019 10:31
Net assets at last report: $14m (cash $2.8m)
current MCAP: around £4m
since last report..
Shandong Ruyi is a leading Asian global textile manufacturer and under the proposed strategic partnership will invest $16.5 million to acquire c.54% of the Company's enlarged issued share capital and will subscribe for 359,560,310 new Ordinary Shares at approximately 3.5p per share as of today's exchange rate.
.. further to the previously announced $16.5 million proposed investment in Bagir, will provide the Company suit jacket manufacturing equipment for exclusive and indefinite use in its Ethiopian manufacturing facility. The manufacturing equipment, which consists of nearly new and second-hand machinery, is being provided to Bagir for nil consideration. The manufacturing equipment provided has an estimated market value of approximately $1.3 million. The manufacturing equipment is expected to be delivered to the Company's Ethiopian manufacturing site during 2019. The addition of the new manufacturing equipment will form the base of a new production line to manufacture suit jackets which, together with an additional investment of approximately $1.5 million from the Company, will be capable of producing 500 suit jackets per day. The additional investment is expected to take place after the completion of the investment by Shandong Ruyi and the Company expects that the suit jacket line will be fully operative by the end of H1 2020. This will be the first stage of the Company's medium term investment plans to increase the capacity of the Ethiopian facility to approximately 3,000 full suits per day using the remaining investment proceeds of $13.2 million from Shandong Ruyi, which are expected to be received no later than 30 May 2019 (following the $3.3 million non-refundable deposit already received by the Company).
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