Beacon Light Announces New Acquisition
( Business Wire )
----------------------------------------------------------------------
( BW)(CT-BEACON-LIGHT)(BLHG) Beacon Light Announces New Acquisition
Business Editors
STAMFORD, Conn.--(BUSINESS WIRE)--Feb. 4, 1999--Beacon Light
Holding Corporation (OTC BB: BLHG) announced today that after
lengthy negotiations, it has signed a Purchase and Sale Agreement with
Casin Video Cassette Limited of Hong Kong, to purchase its Casin
Magnetic Manufactory company consisting of a plastic injection molding
factory and household electronic goods assembly plant in Shenzhen,
Peoples Republic of China for HK$9,480,000, about US$1,300,000.
To finance this acquisition, the Company has announced that it
has received approval for a US$2,000,000 Standby Letter of Credit from
the Emerald Pure Trust to be issued from a European based bank.
Beacon Light further announced that it has entered into a joint
venture Agreement with Klick Ltd. of Hong Kong, a major exporter of
household goods including plastic products manufactured in the Casin
Factory to Western Europe. Beacon Light's working relationship with
Klick started at their Beacon Light Xinhui plastic factory. Klick is
managed by Ronald Steenbergen and Hans Lodders. Additionally, Mr.
Lodders, who was recently knighted by the King of Belgium, works as a
consultant for and was the former head of AGFA's Far East Operations,
the largest film and photo imaging equipment producer in Germany and a
division of the Bayer Pharmaceutical Company of Germany. Under the
terms of the Joint Venture Agreement, Klick will acquire a thirty
percent (30%) interest in the Casin factory. As Beacon Light's Joint
Venture Partner in the factory, Klick has agreed to purchase the
entire production capacity of the factory which is to be produced
specifically for them.
Beacon Light stated that it is currently in negotiation with the
local Xinhui government regarding the status of the Xinhui factory
which is currently not in operation. The Xinhui factory had problems
in that it lacked support from the local Xinhui government and was
straddled with prior debts that the local government could not resolve
adequately to the Company's satisfaction. Under its Agreement with
Orient Light Industry, the seller, a local government entity, was to
obtain new bank financing with the Bank of China to restructure prior
existing debts with Pinnacle International (HK) Ltd., which the local
government was unable to do. Orient Light Industry and the local
Xinhui government are working in another direction to try to resolve
this matter. The Company is expecting some news from them in the very
near future.
The Casin factory, located in the Lucky Industrial Area, Tong Ha
Chung Village, Song Gong Town, Bao An Shenzhen, in the Guangdong
Province of the Peoples Republic of China, currently employs over four
hundred workers in two industrial buildings, each approximately 50,000
square feet which the Company intends to increase. The factory which
has its own dormitory for its workers plus its own electric generating
facility has the ability to expand to additional work shifts as well
as a third industrial building currently being leased out by the
factory. The factory has four times the production capacity compared
to the Xinhui factory. This capacity allows Beacon Light to provide
the necessary household goods required by Klick in the joint venture.
The factory is currently producing videotapes, plastic toolboxes, CD
cases, electric coffee makers, electric teakettles, hair dryers and
other similar electrical and plastic goods for Klick. The factory has
a major production facility for VHS tapes and was the first such
production facility licensed outside Japan. The factory has the US
Underwriter Laboratory (UL) and the equivalent approvals from Europe
such as the CE European Safety approval, and the KEMA, VDE, KGS, and
BS Quality Standards approval for the electric products they produce.
They are further set up to produce disposable cameras including its
highly specialized lens. The factory is set up with a proper testing
center, quality control center and a shop to repair its molds and
equipment and to produce some of its smaller new molds. Klick and its
predecessor have been doing business with the factory for over ten
years. The factory's equipment consisting of various injection molding
machines, robots, video tape assembling machines, generators,
forklifts, molds and other specialized equipment. Not counting
fixtures, furniture and office equipment, the factory equipment has a
replacement value of HK$28,802,416 or in excess of US$3,500,000 and a
current estimated value of HK$13,325,864 or just under US$2,000,000.
Guangdong is China's richest and most independent province.
According to an article published on December 13, 1998 in the
Washington Post, its yearly per capita income is nearly twice the
national average of China. The factory located in the Shenzhen area,
designated as a Special Economic Zone by the Chinese Government, is
about one and a half-hours from Hong Kong by direct bus. This Special
Economic Zone, designated to open China to foreign markets has many
economic benefits to Beacon Light including potentially better banking
relations.
Beacon Light has stated that the factory will be operated and
managed from its own modern corporate office facility in the
Enterprise Square building in Kowloon Bay, Kowloon, Hong Kong which it
subleases from Klick. The Company has hired Mr. K. K. Lai, as the
company's comptroller in Hong Kong for its Far East operations. Mr.
Lai has over 15 years experience with AGFA and was the former
Comptroller, Finance and Head of Administration of a manufacturing
joint venture AGFA had in Jiangsu, Peoples Republic of China. Mr. Lai
speaks fluent English and knows US accounting requirements and
regulations. Mr. Lai is a graduate of the Chinese University of Hong
Kong majoring in Accounting, Financial and Business Management.
According to Klick, the factory, which is currently producing products
for it, should gross in excess of US$20 million in its first full year
of operation. Klick has provided the Company with additional initial
purchase orders in excess of US$2.5 million for video tapes, hair
dryers, juicers, coffee makers and tea kettles.
Safe Harbor Disclosure
This press release contains or incorporates by reference
"forward-looking statements," including certain information with
respect to plans and strategies of Beacon Light Holding Corporation.
For this purpose, any statements contained herein or incorporated
herein by reference that are not statements of historical fact may be
deemed to be forward-looking statements. Without limiting the
forgoing, the words "believe(s)," "anticipate(s)," "plan(s),"
"expect(s)," "project(s)" and similar expressions are intended to
identify forward-looking statements. There are a number of important
factors that could cause actual events or actual results of the
Company as herein discussed to differ materially from these indicated
by such forward-looking statements.
--30--lp/ny* sm
CONTACT: Beacon Light Holding Corp., Stamford
Maureen Bell, 860/488-4111
KEYWORD: CONNECTICUT
INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS COMED CHEMICALS/PLASTICS
MERGERS/ACQ
|
