|
30th
March 2009
PERTH, AUSTRALIA: Please find
below a joint press release from Orbital Corporation Limited (ASX:
OEC - "Orbital") and Continental Corporation.
EXPANSION OF CONTINENTAL
AND ORBITAL ALLIANCE
- Continental and Orbital agree on restructured
joint venture scope to accelerate Synerject growth and profits.
- Orbital becomes Continental's exclusive
representative for specific CNG and LPG products for passenger
cars, transport and mining applications in Australia and New Zealand.
- Synerject pays a special dividend of
US$2.25m to each of Orbital and Continental.
- Continental will take a majority interest
in Synerject by the purchase of 8% of Synerject from Orbital.
PERTH, AUSTRALIA: International clean
energy technology group, Orbital Corporation Limited (ASX: OEC -
"Orbital"), together with Continental Corporation has
changed the commercial and ownership arrangements of their joint
venture, Synerject LLC.
Orbital said today that it had settled a long
standing arrangement to take up 10% of Synerject shares to maintain
a 50:50 joint ownership with Continental by payment of US$4 million.
Further, Continental has agreed to purchase 8% of Synerject from
Orbital for US$4 million and agreed to a series of new commercial
arrangements with Orbital and Synerject.
The key elements of the new arrangements are
as follows:
- Orbital and Continental plan to expand the
scope of Synerject's business.
- Synerject will be owned 42%, 58% by Orbital
and Continental respectively.
- Synerject will continue to operate as an
independent business.
- Continental will contribute a North American
marine Engine Control Unit business with revenue of US$10m to
Synerject.
- Synerject's scope will be expanded to include
manufacturing and supply of CNG products for heavy duty engine
and other specialized application areas.
- With Continental's majority share, Synerject's
purchasing power will improve significantly with full access to
Continental's purchasing systems and processes.
- Orbital will become the representative for
the supply of Continental LPG and CNG fuel supply components such
as ECU interface box including software, injectors, regulators
and fuel rails for passenger cars, heavy duty engine and mining
applications in Australia and New Zealand.
Orbital will record a profit after tax of approximately
US$1.7 million on the sale of 8% of Synerject to Continental for
US$4 million. Both partners will receive a dividend of US$2.25 million
payable immediately prior to the change in ownership.
"The new ownership and business relationship
is a further evolution of the long standing relationship with Continental"
said Orbital's CEO Terry Stinson. "Synerject will receive significant
benefits by being majority owned and controlled by Continental and
the bottom line improvements will flow to both shareholders. We
expect this to ultimately show a better overall financial result
for Orbital over the previous arrangement. This is also in line
with Orbital's strategic plans to expand into alternative fuels",
he added.
Orbital has expanded its long standing alliance
with Continental by becoming the exclusive representative for CNG
and LPG systems that utilise Continental's components in Australia
and New Zealand. This will compliment the recently acquired LPG
system supply business (Orbital Gas Products). Orbital and Continental
are discussing further business relationships particularly in the
Australian alternative fuel industry.
"We are very pleased to take a greater
interest in the Synerject operations." said Torsten Bellon,
Director Engine Systems Non-Automotive & Low Cost Systems. "We
believe that Synerject has great potential particularly in the Asian
motorcycle sector".
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.
About Continental
With sales exceeding €24 billion in 2008,
the Continental Corporation is one of the top automotive suppliers
worldwide. As a supplier of brake systems, systems and components
for the powertrain and chassis, instrumentation, infotainment solutions,
vehicle electronics, tires and technical elastomers, the corporation
contributes towards enhanced driving safety and protection of the
global climate. Continental is also a competent partner in networked
automobile communication. The corporation employs nearly 140,000
at approximately 190 locations in 35 countries.
About Orbital
Orbital is an international developer of engine
and related technologies, providing research, design and development
services for the worlds producers of powertrains 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 powertrains. Orbital provides its customers with leading
edge, world class, engineering expertise. Headquartered in Perth,
Western Australia, Orbital stock is traded on the Australian Stock
Exchange (OEC) and the OTC Bulletin Board (OBTLY).
|
