VTL Announces Rights Issue
VTL Announces Rights Issue to Support Acquisition Strategy
AUCKLAND, 31 August 2001 – Smart-vending company Vending Technologies Limited (NZSE: VTL) today announced a one for ten rights issue to fund the acquisition of Soche Pty Limited and other acquisitions under consideration.
The rights issue is underwritten by Organising Broker ABN AMRO Craigs and is for a renounceable offer of one new ordinary share at $2.50 per share, for every ten existing shares held at the Record Date of 14 September 2001.
Soche operates food, cold drink and coffee machines and its acquisition is an exciting development for VTL as it provides instant expanded critical mass in the key Victorian market as well as a Sydney and Brisbane presence, and importantly gives VTL access to a quality Australian management team.
VTL aims to significantly increase the scale of its Australasian operations by increasing both the number of machines it owns, and the proportion of owned machines that are operated by third party contractors under the its VendSmart franchise programme.
“VTL aims to quickly establish itself as a leading independent vending machine operator in both New Zealand and Australia, and sees the acquisition, integration and franchising of existing vending businesses as the fastest and most cost effective way of achieving this,” says VTL Chairman Dr Richard Janes.
“All acquisitions are expected to add immediate value by increasing earnings per share, and certainly both the purchase of Soche and the recent acquisition of Auckland based Snack Time Enterprises meet this criterion,” says Dr Janes. “They also offer on-going financial and strategic value. No acquisition will proceed unless it adds value both short and long term.”
“The rights issue will raise a total of $7.375 million, and $2.5 million of this will fund the acquisition and integration of Soche. At one for ten, the rights issue is relatively small and attractively priced at a significant discount to market. It nonetheless leaves VTL free of long term debt and provides considerable flexibility for subsequent acquisitions.”
The Company is evaluating a number of other opportunities at present and expects to be able to announce one or more further acquisitions before the end of the financial year.
VTL remains on target to at least achieve its February 2001 profit forecast for the year to 31 March 2002 of $4.9 million after tax, which is 20 percent better than forecast in last year’s IPO Prospectus.
About Vending Technologies
Vending Technologies Limited supplies and operates electronically enhanced food and beverage vending machines throughout Australasia. Established in 1997, the company manufactures, sells, maintains and services vending machines and franchises branded electronic vending businesses under its VendSmart programme.
The company has developed a proprietary computerised management system to enable tracking of all transactions, with complete revenue accountability and the ability to monitor the performance of each machine from remote locations.
Vending Technologies’ independence means it has a network of long-term alliances with leading suppliers of major branded convenience food and beverages.