10th Dec 2007 09:33
Origo Sino-India PLC10 December 2007 Origo Sino-India Plc: successful US$100 million fund launch Origo Sino-India Plc ("Origo" or the Company) (LSE: OSI), the AIM investment andstrategic consulting company focused on the private equity markets of China andIndia, announces the success of a US$ 100 million fundraising for Origo ResourcePartners Limited ("ORP" or the "Fund"), a self-managed investment fund focusedon the private equity opportunities related to the Chinese and Indian naturalresource sectors. ORP is expected to be admitted to the AIM market of the LondonStock Exchange and the Channel Islands Stock Exchange on 14 December 2007. The fundraise launches Origo into asset management consulting, a new businessarea the company intends to develop significantly going forward. Origo expects anumber of benefits to arise for the Company on the back of the successfulfundraising, including: • management and performance consulting fees; • co-investment rights and increased deal flow; • business and transaction advisory consulting fees; • sales agencies and brokerage opportunities for products and services in China and India. The Placing for ORP was undertaken by Liberum Capital Limited, as financialadviser and broker to ORP. Smith & Williamson is acting as Nominated Adviser toORP. Commenting on ORP's intention to float on AIM, Chris Rynning, CEO of Origo,said: "The strong support which the recent fundraising has received from theinvestment market underlines our commitment to low risk, long life investmentopportunities which have been identified through our long standing operationChina and India. Origo intend to actively co-invest with Origo ResourcePartners, converting a range of private equity opportunities which meet with ourinvestment criteria." Origo retains the right to invest alongside the Fund up to 30 per cent. of aninvestment opportunity on pari passu terms. The Fund will be offered investmentopportunities to invest in 11 companies which Origo has entered into letters ofintent, term sheets and/or conditional share subscription agreements in relationto. In total, the existing pre-vetted deal flow exceeds US$100 million worth ofinvestment opportunities. Each of these advanced stage proposed investments stemfrom Origo's partnership approach to the management teams of the investeecompanies through the provision of early stage funding and advice. Chris Rynning added: "Origo and the Fund are ideally positioned to investalongside Chinese and Indian companies going abroad to acquire naturalresources, a new and compelling private equity trend". Summary information on Origo Resource Partners The Fund The Fund is a newly incorporated Guernsey company whose principal objective isto provide Shareholders with capital appreciation primarily from investments inequity and equity-linked instruments in private, unlisted companies whoseprimary business is related to the natural resource sectors of China and India. Investment Consulting The Fund will be a self-managed fund with day to day investment managementactivities of the Fund being undertaken by Chris Rynning and Niklas Ponnert, theExecutive Directors and Directors of OSI. The services of the ExecutiveDirectors together with various support services (to include identifying andevaluating potential investment opportunities, assisting with preliminary dealstructuring and negotiations for such opportunities and monitoring and analyzinginvestments made by the Fund) will be provided by Origo Advisors Limited, theInvestment Consultant, under the terms of an Investment Support Agreement. Inturn, the Investment Consultant has delegated various of its duties to Origo. Origo and the Investment Consultant each have a 50 per cent. entitlement to anadvisory fee of 2 per cent. per annum of the Fund's Net Asset Value, payablequarterly in advance, and a performance fee at the end of a relevant performanceperiod equal to 20 per cent. of the excess of the adjusted Net Asset Value perordinary share over the higher of a hurdle rate of 8 per cent. per annum on acompounding basis and a high watermark, with a an additional super performancefee. Origo have undertaken (i) to offer the Fund a right of first refusal in respectof any investment opportunity which falls within the investment objective and/orpolicies of ORP (save for opportunities in the realm of commodity trading,brokering, chartering and related consulting services) and (ii) until such timeas at least 70 per cent. of net proceeds of the Fund's placing have beencontractually committed, neither of them nor any member of their respectivegroups, shall act as sponsor, manager, advisor or consultant for any other fund. Over the last year Origo has increased its competence, deal-flow, and clientbase in the natural resource sector, as demonstrated by the following relevantinvestments and advisory engagements. Roshini International Bio Energy Corporation Ltd ("RIBEC") On 4 September 2007, Origo announced that it had entered into definitiveagreements with RIBEC to create an international joint venture focused on therenewable bio-energy sector. Headquartered in Hyderabad, India, RIBEC has asizeable plantation of non-edible, tree-borne feedstock. In addition to taking a20 per cent. equity position in RIBEC and extending a credit facility underwhich RIBEC may draw down up to US$2 million for working capital purposes, Origowas retained as a strategic consultant to assist RIBEC in its expansion andfundraising activities. Since then, Origo has secured the right to subscribe forUS$10 million worth of equity for a further 11 per cent. equity stake in thebusiness plus an option of an additional US$5 million at the same valuation(conditional upon the injection of the first US$10 million). Subject toAdmission, Origo has agreed to assign US$1 million of this credit facility andfurther investment rights, at no cost, to the Fund. Fomento International Ltd ("FIL") On 27 August 2007, Origo announced that it had entered into a share subscriptionagreement for an equity subscription in FIL, promoted by Fomento Group, one ofIndia's leading iron ore mining entrepreneurs. Under the agreement, Origo agreedto invest US$10 million in FIL, subscribing for 3 per cent. of FIL.Subsequently, Origo has secured the right to invest a further US$20 million fora further 6 per cent. equity interest in FIL. Subject to Admission, Origo hasagreed to assign this further investment right, at no cost, to the Fund. Further information: Origo Sino-India PlcChris Rynning +86 1390 124 [email protected] Nomad and broker to Origo Sino-India Plc:Seymour PierceStuart Lane / John Depasquale +44 (0) 20 7107 8000 Media enquiries:Capital MS&LPeter Curtain / James [email protected]+44 (0) 20 7307 5330 Notes to editors:Origo Sino-India PlcOrigo is an established private equity investor and strategic consultancybusiness, which provides its shareholders with exposure to growth opportunitiesand private equity returns in China and India. Headquartered in Beijing, China,Origo maintains offices in Shanghai and has representation in Mumbai, Cape Townand London. Origo's business model is to generate capital gains from private equityinvestment in growth companies from which it also generates fees for consultancyservices related to further fundraisings, M&A and strategic development. Origo is aligned with two major institutions which provide a source of highquality deal flow. In China, Origo work closely with China Equity, a leadingprivate equity firm, whose chief executive is on Origo's Board. In India, Origohas entered into a memorandum of understanding with SBI Capital Markets, one oflongest established companies in the Indian Capital Markets. A former chairmanof State Bank of India is on the board of Origo. At the AIM Placing in December 2006 Origo raised £12.8 million gross of newmoney via a placing of 25,673,238 ordinary shares at 50 pence per share. Eachordinary share carries a warrant exercisable at 55p. www.origoplc.com This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
OPP.L