Suits maker Bagir Group Ltd is acquiring the 50% of its Ethiopian manufacturing operation it does not own for $1.9m with $600,000 of this payable immediately.
Loss-making Bagir is hopeful that the manufacturing site will be an attractive source of clothing for customers in the UK and US. In 2015, the business made a post-tax profit of $590,000 on revenues of $1.38m.
The acquisition cost and capital investment to expand production could total $3m. Last autumn, Bagir raised £6.4m at 3.5p a share. The current share price is 4.1p.
The acquisition should be completed by the end of April.
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