BURLINGTON, ON, Aug. 15 /CNW/ - Kingsmill Capital Ventures II Inc.
("KII") (KII.P-TSX Venture), a Capital Pool Company, is very pleased to
announce that it has entered into an agreement in principle with Innovative
Composites Inc ("ICI") on August 7, 2008 to acquire (the "Acquisition") all of
the issued and outstanding securities of ICI in exchange for securities of
KII. This transaction is intended to be the qualifying transaction (the
"Qualifying Transaction") of KII as such term is defined in Policy 2.4 of the
Corporate Finance Manual of the TSX Venture Exchange (the "Exchange").
About ICI
ICI is an Ontario corporation with a registered head office at 100 King
Street West, Suite 5700, Toronto, ON M5X 1C7. ICI was formed by Terry Ball and
a group of executives having extensive experience in the plastics and
automotive industries. ICI's manufacturing assets are located in Michigan,
USA.
ICI is seeking to become the leader in the supply of lightweight, cost
effective, structural products to equipment manufacturers, and intends to do
so by leading the composites industry in the design, engineering and
manufacturing of patented products featuring continuous fiber reinforced
thermoplastics ("FRT") technology. Management believes that ICI's structural
products, featuring FRT, offer a distinct competitive advantage over existing
structural products, and is seeking to place its products in the marine,
construction, automotive, military, recreational vehicles, equine and
furniture industries.
On June 23, 2008, ICI executed a letter of intent and is currently in the
process of executing a formal purchase agreement to acquire all of the assets
of Lakeshore Diversified Products Inc. ("LDP"). This acquisition is intended
to close concurrently with and form a part of the Qualifying Transaction.
Despite the fact that LDP is operating at less than 50% of its capacity, it
has been producing a positive EBITDA. With ICI's experience and network of
contacts in the automotive industry, management intends to fill this capacity
and thereby achieve increased profits and improved margins. In addition, LDP
is currently is in the process of installing three high tonnage molding
machines, which it has acquired at a significant discount to market and which
will broaden the company's manufacturing and production capabilities. LDP is a
Michigan corporation with a 70,000 square foot injection molding and assembly
manufacturing facility in Spring Lake, Michigan, providing ample space and
plant machinery to provide for the planned growth of the resulting issuer.
ICI, to date, can be best characterized as a development stage company,
and accordingly, sales revenues have been limited and the company has incurred
operating losses since inception. For the year ended December 31, 2007, ICI's
manufacturing operations generated revenues of $5,000 and incurred losses of
$800,000 primarily due to investment into specialized material and product
applications. (All financial numbers for ICI are unaudited.) As of December
31, 2007 there were assets of $442,300 and liabilities of $833,600 in respect
of these operations. For the year ended December 31, 2007, LDP had revenues of
$6.3 million and EBITDA of $309,000. As of December 31, 2007, LDP had total
assets of $3.35 million and total liabilities of $3.0 million. (All financial
numbers for LDP are unaudited.)
Terry Ball of Michigan, U.S.A., is the President and CEO of ICI, and
beneficially controls 11.4% of ICI. Mr.
