15 Feb 2016 16:45
World Trade Systems PLC ("WTS")
Chairman's Statement
World Trade Systems PLC 15 Feb 2016
Announcement of New Business Activity
In my Statement which accompanied the Annual Financial Report for the 12 months to 30 September 2014, I stated that the principal risk and uncertainty facing the Company relates to it finding suitable new business opportunities, within the timeframe of the current financing arrangements. Should such an opportunity not materialise and if new financing arrangements are not forthcoming the Board will consider taking steps to wind up the Company.
We are pleased to announce that we have been approached by Avalon Enterprises Ltd ("Avalon") and JH Global Partners Ltd ("JH Global") to inject a new business into the Company and immediately seek a relisting of the Company through lifting of the suspension of trading in the Company's shares. Avalon and J H Global have signed subscription agreements of 1.25 million shares each at £ 0.02 per share injecting a total of GBP 50,000 into the Company to implement the proposed transaction described below.
We wish to announce that a Memorandum of Understanding has been signed with Suzhou Weibao Investment Co Ltd ("SZWB") which, in summary, provides for the following proposed events, subject to due diligence, and shareholder and regulatory approval by the UK Listing Authority:
SZWB., a PRC corporation located in Suzhou China has been engaged in health care businesses involving the production and sale of bio-tech medical and healthcare products as well as in investment in research, development and patenting of biotechnical processes and formula used to make the products which it sells.
WTS will acquire an existing hitherto unused company in the SZWB group thereby converting it into a wholly foreign owned enterprise in China ("WTS China"), which will be fully licensed as a domestic Chinese company for the purpose of engaging in (i) manufacturing and selling SZWB's bio-technical medical and healthcare products; (ii) engaging in domestic and cross-border mergers and acquisitions in bio-technical businesses; and (c) assisting in the development of off-shore care centres for the elderly, including Chinese persons seeking offshore medical services (collectively, the "WTS China Venture Business"). These business activities and the know-how relating thereto will be transferred into WTS China by SZWB such that all costs and revenues relating thereto will immediately accrue to WTS China. It is anticipated that this new business of WTS in China will formally commence from March 1, 2016. The goal will be to generate before tax profits of approximately US$3 million per year from this new business.
At the same time, WTS will enter into a loan agreement with SZWB, pursuant to which SZWB will advance the sum of £1,000,000 to WTS (the "SZWB Loan") which will be used to repay all of WTS's current and outstanding shareholder loans and related debt owed to Kudrow Finance Limited, the Company's majority shareholder.
Following the signing of the MOU, Dr Shao Chen, the founder and Chairman of SZWB will join the Board of Directors.
Mr Abdul Khader Mohamed Ismail, a banker by background who has considerable experience with mainland Chinese Companies, will join the Board at a later stage after the GBP 1.0 million loan to WTS is placed in Escrow with the UK legal counsel.
We have also signed an engagement letter with Optiva Securities Limited appointing them as Financial advisor and Broker to assist with the Company's application to lift the suspension of trading in the Company's shares and it is hoped that this will occur simultaneously with the commencement of the Company's new business in China.
We are pleased to be able to make these announcements after so many years of unsuccessful efforts to revive the Company's fortunes and we look forward to all shareholders support in these new endeavours.
Robert Lee
Chairman
15 Feb 2016