Mergermarket - Fox Marble seeks JVs and strategic partnerships in North America, India, Vietnam and GCC countries

Source: Mergermarket

Date: 29/01/16

by Riccardo Ghia in Hong Kong

Fox Marble [LON:FOX], a dimensional stone company with quarries in Kosovo and Southeast Europe, is exploring JVs, distribution and offtake agreements in North America, India, Vietnam and GCC countries, CEO Chris Gilbert said.

The GBP 21.9m market cap company is not seeking acquisitions but it is keen on building JVs and strategic partnerships with local players, Gilbert said.

Its offtake and distribution agreement with China-based Zhong Shengdestone could be used as a blueprint for deals in other countries, he added.

According to the agreement, Zhong Shengdestone has to acquire at least 10,000 tonnes of marble a year from Fox Marble if it wishes to retain exclusivity rights for the commercialization of Fox Marble’s products in China.

Gilbert said that 10,000 tonnes corresponds to a value of USD 2.5m - USD 8m, depending on which quality of marble Zhong Shengdestone will order.

Fox Marble is also seeking investors to replace a GBP 1m convertible note held by Amati Global Investor issued in 2012, which also holds a 4.7% stake in Fox Marble. The company is not planning further fundraising exercises in the short term, nor is it planning any capital-intensive investments, Gilbert said.

Later this year, Fox Marble expects to start operations at its 7,000-square-metre marble-processing factory in Kosovo. Construction started in 2014. The new factory, which cost EUR 4.5m, will enable Fox Marble to increase its profit margin as the company currently sends its marble to third-party processors in Italy.

Fox Marble has EUR 2.8m in cash as of 31 December 2015 and its confirmed orders to date for 2016 amount to EUR 3.5m, Gilbert said. The company uses the services of Brandon Hill (formerly Fox-Davies Capital) as its nominated advisor and broker, Nabarro as lawyers, PwC as auditors and Yellow Jersey as PR.

Major shareholders include Etrur Albani (12.4%), Chris Gilbert (12.1%), Dominic Redfern (7.5%), Majedie Asset Management (6.4%), Standard Life Investments (5.5%), Artemis Investment Management (5.4%) and Miton Group (5%), Gilbert said.