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Asia Distribution Solutions Ltd

  • BY: Andrew Hore |
  • POSTED: 07/09/2008 |

Asia Distribution Solutions Ltd reported profits of £213,000 on turnover of £2.45m in the six months to June 2008. 

ADSL provides drinks to more than 3,500 on-trade and retail outlets in China. The plan is to expand into other areas of China.

The shares fell 5.5p to 25p each after the proposed acquisition of ADSL by Yarraman Winery Inc was announced. The all share deal values ADSL at $27m (£15m) but it current market capitalisation is £7.67m. Yarraman shares are not traded on a liquid exchange so it is no surprise that ADSL shares are trading at a discount but it is very high.

There was one sale of 10,000 shares at 25p each on Friday.

ADSL hopes that the merger with Yarraman will help it to expand at a faster pace. Yarraman is already supplying ADSL with wine. Chinese consumption of wine is growing much faster than the world market as a whole. ADSL will be able to develop its private label wine business.

The plan is to gain a quote for the enlarged business on the US OTC Bulletin Board. This probably won’t be attractive to many small UK shareholders in ADSL. That could also explain the relatively low share price. 

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