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or Name
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GreenBank Capital Inc (2)
Symbol GBC
Shares Issued 50,065,128
Close 2021-01-21 C$ 0.36
Market Cap C$ 18,023,446
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GreenBank investee Staminier closes P&H acquisition

2021-01-22 14:39 ET - News Release

Mr. David Lonsdale reports

GREENBANK CAPITAL PORTFOLIO COMPANY STAMINIER LIMITED COMPLETES ENTRY INTO THE ELECTRIC VEHICLE ("EV") MOTORCYCLE MARKET BY ACQUIRING THE SOUTH OF ENGLAND'S LARGEST DISTRIBUTOR OF MOTORCYCLES

GreenBank Capital Inc. portfolio company Staminier Ltd. has exercised its option announced on Dec. 4, 2020, and has completed the acquisition of P&H Motorcycles Ltd., the South of England's biggest distributor of high-performance motorcycles, including: Ducati, Yamaha, Kawasaki, Suzuki, KTM, Scrambler and Honda. As previously disclosed, GreenBank currently owns 19 per cent of Staminier and possesses an option to acquire the remaining 81 per cent of Staminier until Feb. 14, 2021, subject to regulatory approval.

The average monthly sales of P&H over the past three years have been approximately $1.7-million per month ($20-million per year), and the business has sold motorbikes and accessories to over 150,000 unique customers in its 40-year history of success.

During the global pandemic, P&H has seen demand for smaller 125 cc bikes increase significantly, and P&H and Staminier see considerable scope for expansion into the lower-powered motorcycle market. However, both companies see the greatest area of expansion as supplying the likely substantial increase in demand for electric-powered motorcycles and scooters. P&H, with its powerful market position and extensive database of motorcycle clients and enthusiasts, is very well positioned to capitalize on the forthcoming transition from conventional bikes to electric power.

P&H has net assets of just over $1.7-million, including freehold property valued at $4.25-million sited near London Gatwick, which is an ideal location for servicing the expected fast growth in EV demand. Despite the pandemic, P&H is currently profitable on a month-to-month basis and expects to generate a net annual profit of no less than $425,000 in 2021.

Terms of acquisition:

  • $255,000;
  • One million GreenBank Capital common shares;
  • $935,000 of Staminier non-voting convertible preference shares with the right to convert into GreenBank common shares between July 1, 2021, and Dec. 31, 2021, at a price equal to the closing price of GreenBank common shares on June 30, 2021, subject to a maximum of 2.75 million GreenBank common shares;
  • $850,000 of Staminier non-voting second tranche convertible preference shares that are convertible into one million GreenBank common shares at 85 cents per common share at any time after three years from the date of completion, subject to the vendor's continued employment for a period of three years from the date of completion;
  • Cash equivalent to two times the audited net pretax profits of P&H in the 12-month period to Dec. 31, 2021, payable in two equal payments. The first payment is due within three months of P&H's audit completion date of the Dec. 31, 2021, accounts, and the second payment is due on the third anniversary of completion, subject to the vendor's continued employment for a period of three years from the date of completion.

The vendor has agreed not to sell or otherwise dispose of any Staminier or GreenBank shares received pursuant to this transaction for a period of at least 12 months from the completion of the transaction. In the event that Staminier is not acquired by GreenBank, certain Staminier shareholders have agreed to transfer sufficient GreenBank shares to the vendor to satisfy the terms of acquisition.

As part of the acquisition, it has been agreed that up to 50,000 of P&H's loyal customers will be given the opportunity, subject to regulatory compliance, to purchase units at 45 cents each in GreenBank's recently announced $4.5-million non-brokered private placement. Each unit in GreenBank's private placement consists of one common share in the capital of GreenBank and one-half of a common share purchase warrant. Each common share purchase warrant entitles the holder to acquire one additional common share in the capital of Greenbank Capital at an exercise price of 50 cents for 36 months after closing.

David Lonsdale, chief executive officer of GreenBank Capital, said: "We are delighted that the acquisition of P&H has completed smoothly. As previously stated, one of our six key declared value drivers is to acquire progressively larger established and successful companies; we are delighted to say that the acquisition of P&H by Staminier not only fulfils that criteria, but also provides an ideal launch pad into the fast-growing and highly exciting EV market."

Paul Searle, vendor and managing director of P&H, said: "We are delighted to become part of the Staminier group and the wider collaboration with GreenBank Capital Inc., the dynamic, next-generation merchant bank, as we build out the P+H growth story in the years to come. I agreed to accept the bulk of the consideration for P&H, my life's work, in shares because I am fully persuaded by the exceptional growth potential of the combined businesses. I am therefore very grateful that our loyal customer base has been given the opportunity to participate as well."

About GreenBank Capital Inc.

GreenBank Capital is a next-generation merchant banking business that has a flexible, low-cost overhead structure designed to help the business grow exponentially. The company's management is based in Toronto, Dallas, New York and London, and is used to remote working across borders. GreenBank Capital's model of remote working, dynamic office space and flexible contracts -- rather than expensive offices and large fixed costs -- establishes GreenBank as a potential global merchant bank for the future, both during and after COVID-19.

GreenBank seeks to invest in, and work with, globally scalable companies and is focused on building consistent capital appreciation for its shareholders.

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