Elektromotive

Elektromotive: proposes to sell its 55% stake in its UK subsidiary, EUK to Chargemaster for a cash consideration of $10.8m. Calvey Taylor Haw, MD of EUK who owns a 42% stake in EUK, has also agreed to sell his stake to Chargemaster. EUK designs and installs technology for recharging EVs, such as the “Elektrobay”, which is a recharging station for on-street or multistorey carpark installations. After the sale, Elektromotive will receive a royalty free license to use the various legacy technologies and solutions developed by EUK in the past. The group will retain the rights to use legacy charging technology in Asia and Australasia, excl Japan. Mgt notes with the disposal, its war chest will be significantly strengthened to pursue EV-related business opportunities in various fast growing Asia markets, particularly China. Says part of the proceeds will also go towards rewarding sh/h via dividends and the implementation of a share buy back plan. The sales proceeds of $10.8m represents 86% of Elektromotive’s $12.6m mkt cap, based on the counter’s last traded at 0.3cts/ sh. As at 30 Sep ’12, the group has borrowings of $1.5m, Following the sale, the group’s net cash position is expected to exceed $10m. There is no indicative date for completion of transaction. Sh/h approval at an EGM is required, amongst other conditions precedent to completion.