- Orbital to acquire Tier 1 LPG fuel systems supplier, Boral Alternative Fuel
Systems.
PERTH, Australia, June 18 /PRNewswire-FirstCall/ -- International clean
energy technology group Orbital Corporation Limited (ASX: OEC - "Orbital"), is
pleased to announce the addition to its existing portfolio through the
acquisition of leading Australian LPG fuel systems supplier, Boral Alternative
Fuel Systems ("BAFS").
BAFS is Australia's leading supplier of original equipment LPG fuel
systems and is a Tier One supplier to the global automotive group, Ford Motor
Corporation.
The acquisition provides Orbital with a low-risk entry into the rapidly
growing Australian and New Zealand alternative fuel system markets, and
represents a first step in a broader intent to offer 'next generation'
greenhouse friendly alternative fuel systems that meet the requirements of
fleet operators and private buyers.
Under the terms of the acquisition agreement, Orbital will make an
investment of approximately $1.6 million to assume BAFS's working capital
(excluding debtors and creditors) including a small component of goodwill.
Subject to satisfaction of all conditions precedent transfer of the business
is expected to occur prior to June 30th, 2008.
BAFS, which is based in Sydney NSW, currently generates annual revenue of
approximately A$6 million, and is expected to be earnings per share accretive
for Orbital from the date of acquisition. Key management and operating
personnel will transfer across to Orbital with the business.
In summary, the BAFS business:
-- assembles and distributes original equipment products in Australia and
New Zealand manufactured by Vialle, a leading Netherlands-based international
manufacturer of LPG automotive fuel systems;
-- sells LPG systems into the aftermarket for retrofitting to existing
vehicles;
-- has over 20 years' experience in the LPG systems supply business; and
-- has access to Vialle's next generation, greenhouse-friendly LPG
systems.
Commenting on the acquisition, Orbital's CEO, Dr Rod Houston, said, "We
are very pleased to add the BAFS LPG systems supply business to our portfolio,
in keeping with our strategy of growing and enhancing the Orbital business
organically and through targeted acquisitions. We expect BAFS to contribute
to the Orbital business in a similar way to our international Synerject Joint
Venture business, which generates a strong ongoing revenue stream."
"There is a strong future for genuinely greenhouse friendly LPG systems.
The next generation LPG systems, if properly implemented and supported, have
the ability to deliver significant reductions in greenhouse gas whilst
retaining the economic benefits of operating vehicles on LPG," Dr Houston
continued.
"This is a first step in our overall strategy to leverage our existing
skills and know how and to grow an alternative fuel systems business and
develop strategic partnerships with world class organisations such as Vialle.
Orbital is well placed to secure a significant position in the alternative
fuels market, where we see increasing opportunities as the price of oil
continues to rise significantly," he added.
About Orbital
Orbital is an international developer of innovative technical solutions
for a cleaner world. Orbital provides innovation, design, product development
and operational improvement services to the world's producers, suppliers,
regulators and end users of engines and engine management systems for
application in motorcycles, marine and recreational vehicles, automobiles and
trucks. Orbital's principal operations in Perth, Western Australia, provide a
world class facility with capabilities in design, manufacturing, development
and testing of engines and engine management systems. Headquartered in Perth,
Western Australia, Orbital stock is traded on the Australian Stock Exchange
(OEC) and the OTC Bulletin Board (OBTLY).
Forward Looking Statements
This release includes forward-looking statements that involve risks and
uncertainties. These forward-looking statements are based upon management's
expectations and beliefs concerning future events. Forward-looking statements
are necessarily subject to risks, uncertainties and other factors, many of
which are outside the control of the Company, that could cause actual results
to differ materially from such statements. Actual results and events may
differ significantly from those projected in the forward-looking statements as
a result of a number of factors including, but not limited to, those detailed
from time to time in the Company's Form 20-F filings with the US Securities
and Exchange Commission. Orbital makes no undertaking to subsequently update
or revise the forward-looking statements made in this release to reflect
events or circumstances after the date of this release.
SOURCE Orbital Corporation Limited
Dr Rod Houston, CEO, +61 8 9441 2311; or Tony Fitzgerald, Director, Sales &
Marketing, +61 (0)413 703 023, Info@orbitalcorp.com.au
