omniture

Home System Group Signs Stock Exchange Agreement to Acquire Zhongshan City Juxian Gas Oven Co., Ltd

2007-04-23 21:15 977


Acquisition to Complement Production Capabilities for Moderately Priced Gas Grills; Significantly Strengthens Customer Base and Geographic Coverage

LOS ANGELES, Calif., April 23 /Xinhua-PRNewswire-FirstCall/ -- Home System Group (OTC Bulletin Board: HSYT) based in Guangdong Province, PRC, an International manufacturer and distributor of home appliance products to major global retailers, today announced it signed a stock exchange agreement on April 20, 2007 to purchase Zhongshan City Juxian Gas Oven Co., Ltd. based in Zhongshan City, which is part of the Guangdong Province. The acquisition is subject to final due diligence and negotiation of terms, in addition to obtaining applicable government approvals.

Zhongshan City Juxian Gas Oven Co., Ltd. was founded in 2001 and develops and manufactures a broad range of stainless steel and metallic gas grills and ovens, with retail price points between $100 and $500, in addition to electric and gas heaters for major retailers in the United States and China. The facility is ISO 9000-2000 certified, encompasses approximately 100,000 square feet situated on approximately 4.5 acres of land. These facilities include 3 grill production lines, 2 electric and gas heaters production lines, and 2 accessories production lines.

"This transaction is consistent with our business objective to grow revenues both organically and through complementary acquisitions and significantly broadens our overall product portfolio, while providing an entree to the economy, lower priced grill segment. Zhongshan City Juxian Gas Oven Co., Ltd. is located about 30 minutes from our manufacturing facility and its core competencies and expertise are consistent with ours. We have the capability to significantly expand overall production capacity, leverage our extensive research and development platform for new product introductions, while lowering lower associated costs of goods sold through strong purchasing power. The Company provides access to new blue chip retail customers, including one based in Canada, which will enable us to pursue incremental cross selling opportunities for our current line of grills and other home related products," stated Mr. Li Wei Qiu, CEO and Chairman of Home System Group.

"In addition, we believe our manufacturing expertise and strong distribution platform will provide the opportunity to improve the Company's revenues and profit margins as we fully integrate the companies. As we have mentioned previously, the US and Europe respectively represent a $4 billion and $2 billion grill market annually and our goal is to target each segment of this opportunity enabling us to win additional market share," Mr. Li Wei Qiu concluded.

Total consideration for the acquisition is estimated at approximately $14 million, which includes approximately one million shares in restricted common stock priced at $4.00 and $10 million in a cash note, to be evidenced in the form of promissory notes with two equal payments due half within twelve months and the other half due within twenty-four months following the closing. The acquisition is expected to close on or before June 30, 2007.

About Home System Group

Headquartered in Hong Kong, China, Home System Group, through its wholly owned distributor Oceanic International (Hong Kong), Ltd. (OCIL) and Oceanic Well Profit Inc produces and distributes home appliances, including stainless steel gas grills, residential water pumps, electronic fans, fruit processors, and other electrical appliances to retailers in the U.S., Europe and Australia. Please visit the corporate website at: http://www.homesystemgroup.com .

Safe Harbor Statement:

Certain statements in this news release may contain forward-looking information about Home System Group, Inc.'s business and products within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, and are subject to the safe harbor created by those rules. The actual results may differ materially depending on a number of risk factors including, but not limited to, the following: the ability of Home Systems to complete the acquisition, the general economic and business conditions globally, product development, shipments to end customers, market acceptance of new and existing products, additional competition from existing and new competitors, changes in technology, and various other factors beyond its control. All forward-looking statements are expressly qualified in their entirety by this Cautionary Statement and the risks factors detailed in the Company's reports filed with the Securities and Exchange Commission. Home System Group undertakes no duty to revise or update any forward-looking statements to reflect events or circumstances after the date of this release.

Please refer to the 8-K filed with the SEC on April 23, 2007 for additional details.

For more information, please contact:

Investor Contact:

Michelle Zheng

Home Systems Group

Tel: +1-213-223-2277

Email: mz_lawork@hotmail.com

Matt Hayden

HC International

Tel: +1-858-704-5065

Email: matt@haydenir.com

Source: Home System Group
Related Stocks:
OTC:HSYT
Keywords: Food/Beverages
collection