Sweet China in £4.3 million comeback
Article Date: Jan 23 2008Chinese chocolate maker Sweet China is returning to AIM with a £4.3 million acquisition and £2.7 million placing, and says there are bigger deals to follow. Floated as a shell in 2005 but delisted the following year, the company says it expects to re-list this month, after clinching its long-delayed purchase of confectionary business Essential Box.
The acquired company, which was wholly owned by Ian Walker, sources production in the People's Republic and caters not only for the burgeoning Chinese market but supplies Western markets with popular upmarket brands.
Sweet China, run by barrister, media man and entrepreneur Chris Cleverly, plans to follow this with the purchase of the ‘state-of-the-art’ factory at which the chocolates are made, involving another £2 million funding, and then a £50 million tie-up with a major Chinese confectioner.
Sweet China first sought to buy Essential Box in 2005, but says it insisted on an internal restructuring, which took so long that AIM had its shares suspended in 2006. Now the company is paying £3.4 million in shares and £950,000 cash for Essential, which it says is expected to make £750,000 on £7 million turnover in the year to April, with performance-related extras possibly taking the eventual total to £6.35 million.
Talks about the big confectionery tie-up are understood to be at an advanced stage. Meanwhile, Sweet China, advised by Zimmerman Adams, is accompanying the Essential deal with a £2.7 million placing at 9p.
