Thomson Geer was the law firm of choice for eCargo Holdings Ltd in its acquisition of an export business in China from a fellow ASX-listed company.
eCargo acquired 85% of Metcash Export Services Pty Ltd – including Metcash Asia Ltd, a subsidiary and wholly-owned foreign enterprise in China – from Metcash Trading Ltd, a wholly owned subsidiary of Metcash Ltd.
The Thomson Geer team was headed by partner Matt Reynolds and senior associate Dan Stumm. Reynolds said that the deal, which he described as an interesting cross-border matter for the team, was transformative for eCargo.
The acquisition allows eCargo to create a one-stop offering for businesses intent on capturing the attention of the growing Chinese consumer market, both through the internet and traditional brick-and-mortar stores. The China head of Metcash will be appointed as CEO of eCargo, and both companies have also agreed to cooperate on supply and export opportunities in China.
Operating in both China and Australia, eCargo offers e-commerce, technology, and supply chain services for companies that want to sell products in China.
As Australia’s leading wholesaler and distributor, Metcash supplies and supports more than 10,000 independent retailers with food, liquor, and hardware products.
Thomson Geer said that eCargo paid $2.5m and $5.8m for 85% of the net asset value of Metcash Export Services. The company will also pay up to $3.5m in deferred compensation.