Acquisition of remaining stake in US licensee company
Key management hires in the US
04 May 2006
Hot Tuna (International) PLC ( AIM:HTT), a lifestyle apparel brand with authentic surf heritage, is pleased to announce the acquisition of the remaining 49 per cent. interest in its US subsidiary licensee company. The purchase of the remaining stake in Hot Tuna International Inc. is part of the Company’s overall strategy and follows the acquisition of a 51 per cent. controlling interest as announced on 17 November 2005.
The Company has acquired the additional 49 per cent. holding of common stock in Hot Tuna International, Inc. from Hot Tuna USA, LLC ("Hot Tuna USA"). Hot Tuna USA initially acquired the stake pursuant to an Asset Purchase and Contribution Agreement on 17 November 2005. The Asset Purchase and Contribution Agreement was in consideration for Hot Tuna USA assigning to Hot Tuna International Inc. its exclusive licence, in the United States and Mexico, to use the intellectual property for Hot Tuna logos to design, manufacture, distribute and sell products bearing the logo. Following the purchase of the remaining 49 per cent. stake, Hot Tuna International Inc is now wholly-owned by the Company.
To fund the purchase of the additional 49 per cent. stake in Hot Tuna International Inc., the Company has allotted and issued 3,400,000 ordinary shares in the Company to Hot Tuna USA. The shares are subject to lock-in restrictions on sale, whereby subject to limited exceptions, 1,700,000 may not be sold for a period of one year and 1,700,000 may not be sold for a period of two years. Application will be made for the new ordinary shares to be admitted to AIM. Dealings are expected to commence on 9 May 2006. The Company has also agreed to grant Hot Tuna USA an option to acquire up to a further 2,230,000 ordinary shares. Of these options, 1,115,000 options will be exercisable from the end of year one at a price of 75p and 1,115,000 options will be exercisable from the end of year two at a price of 100p. All options are exercisable for a period of five years.
For the purposes of Rule 13 of the AIM Rules, the acquisition of the remaining 49 per cent interest in Hot Tuna International Inc. constitutes a related party transaction because Hot Tuna USA owns more than 10% of the shares in Hot Tuna International Inc., which is a subsidiary of the Company. The directors of the Company consider, having consulted with its Nominated Adviser Seymour Pierce, that the terms of the transaction are fair and reasonable insofar as its shareholders are concerned.
Commenting on the acquisition, Ranjit Murugason, Chairman of Hot Tuna, said: “The acquisition of the remaining stake in Hot Tuna International Inc. continues our strategy of gaining direct ownership over the Hot Tuna brand in key global markets. Our full control over our subsidiary in the US, which is the world’s largest surf clothing market, places the Company in a strong position to create maximum traction in this important region.”
Key Management Hires
The Company is also pleased to announce that, as part of its strategy and to strengthen its US operation, it has made the following three new executive appointments all of which commenced working for Hot Tuna International Inc. in April 2006 -
Tim Bernardy has joined the Hot Tuna team as the new Chief Operations Officer and principal executive in charge of Hot Tuna’s US business. Mr Bernardy has over 25 years of relevant industry experience in the US including 15 years with O’Neill, one of the leading US surf lifestyle brands, where he acted as the National Sales and Marketing Director. Prior to his position at O’Neill, Mr Bernardy was the National Sales and Marketing Director of RedSand, a division of NASDAQ listed Perry Ellis Inc. Mr Bernardy is immediately charged with the job of driving the US business and assisting with global business strategy.
Alain Mazer recently left NASDAQ-listed Warnaco as the Director of Public relations for Ocean Pacific to join Hot Tuna. Mr Mazer is an award-winning marketing specialist with a history of successes focused in youth culture and related action sports, fashion, music and entertainment and has been appointed as the Director of Marketing and Public Relations. Mr Mazer will be responsible for all marketing, advertising, brand management and communications activities for the Company.
Bryce Cole joins Hot Tuna from his previous role as the Design Director at Perry Ellis for the RedSand brand and was previously the senior designer for Rusty and O’Neill. Mr Cole is a multifaceted designer with a solid understanding of global market trends and sales patterns. Furthermore, he also has extensive retail experience from concept design to buying and merchandising. Mr Cole will be in charge of the design department at Hot Tuna International Inc. and responsible for all design and production activities.
Commenting on the appointments, Marcus Gracey, Managing Director of Hot Tuna, commented: “The strategic addition of these key executives adds significant weight and experience to the US team and the global executive group. I am very excited that Hot Tuna is attracting this calibre of experience and also that they are like-minded, lifestyle driven, passionate individuals who culturally fit the business. Together, these additions will deliver significant momentum and noticeable change to the business within a very short period of time.”
For further information:
| Hot Tuna (International) PLC | |
| Ranjit Murugason, Chairman | Tel: +44 (0) 20 7372 9378 |
| ranjit_murugason@hottunaplc.com | |
| Seymour Pierce Limited | |
| Sarah Wharry / Parimal Kumar | Tel: +44 (0) 20 7107 8000 |
| parimalkumar@seymourpierce.com | www.seymourpierce.com |
Media Enquiries:
| Abchurch | |
| Henry Harrison-Topham / Chris Lane | Tel: +44 (0) 20 7398 7700 |
| henry.ht@abchurch-group.com | www.abchurch-group.com |
Notes to Editors
Hot Tuna (International) PLC (AIM: HTT) owns the rights to the Hot Tuna brand, a progenitor of global youth fashion, born in Australia with a heritage of authentic surf culture.
Hot Tuna is one of the world’s most iconic names in surf lifestyle and can trace its roots back to 1969 when it was founded by a surfer and his fashion designer wife. The label has not been actively marketed over for the last decade, but has maintained an organic cult status among the core surf and sports enthusiasts.
In June 2005, Hot Tuna (International) PLC purchased the ‘Hot Tuna’ brand from a consortium of investors, listed it on AIM in September 2005, and has since started to aggressively market the brand and reinvigorate the business. The Company now owns all intellectual property rights to its name and related iconography, and has in place key management drawn from the executive ranks of Quiksilver, O’Neill and Ocean Pacific, among others.
While headquartered in the UK, Hot Tuna operates its design, manufacturing, marketing and distribution hub in the USA. Hot Tuna sells product, which it directly manufactures in facilities in the USA, the European Union and in China.
Hot Tuna maintains offices in Sydney, Los Angeles and London.