27th Mar 2019 12:30
LONDON (Alliance News) - Woodbois Ltd said Wednesday it has agreed to a further investment from Lombard Odier Asset Management Group to complete the acquisition of subsidiary Montara Continental Ltd.
The African focused forestry and timber company - which previously traded under the name Obtala - said the GBP960,000 investment from Lombard Odier was raised through a subscription agreement.
Lombard Odier will be issued 16.0 million shares at a price of 6.0 pence each. Shares in Woodbois were up 1.1% Wednesday at 6.92 pence each.
Lombard Odier now holds 25% stake in Woodbois' total issued share capital, representing 116.4 million shares.
The proceeds from the subscription from Lombard Odier will be used to settle the USD2.5 million deferred consideration due to Africa Resource Investment Ltd.
In January, Woodbois agreed to buy the remaining stake it did not hold in subsidiary Montara Continental from Africa Resource.
"I'm delighted to announce the conclusion of these agreements, marking yet another significant milestone in the comprehensive re-structuring of the group organisation. With a streamlined structure, a much-strengthened balance sheet and the ability to focus squarely on core activities in which we not only intend to compete profitably, but to excel, I am confident that the group will deliver growth in 2019 and consistently into the next decade," said Chief Executive Paul Dolan.
Woodbois also amended the disposal agreement it has with local partner Envision Consulting Ltd over the sale of its agricultural assets in Tanzania.
Woodbois earlier agreed to a USD2.5 million price for the sale, with USD250,000 due January 30 and USD2.3 million payable March 30.
Woodbois agreed for subsidiary Montara to sell its entire holdings in Magole Agriculture Ltd, Magole Land Ltd, Milama Processing Co Ltd and Wami Agriculture Company Ltd - all of which are incorporated in Tanzania - to Envision.
Under the amended terms, however, only Magole Land will be sold to Envision with the assets of Magole Agriculture, Milama and Wami being transferred to Envision.
As a result, the purchase price has been adjusted to USD2.0 million and Envision will take on the inter-company loan owed by Magole Land to Magole Agriculture. The first USD250,000 is payable April 30 with 11 subsequent payments of USD204,545, the first of which is due July 30.
Envision currently owns 10% of Wami and Magole Land.
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