Sancon Resources Recovery, Inc., a growing waste logistics and recycling company with main operations located in China, announced today that it has entered into an acquisition agreement with a profitable Beijing environmental services company.
On March 25, 2011, Sancon signed a letter of intent with Beijing JDY Environmental Recycling Co., Ltd. (or "Beijing JDY"), under which Sancon's majority owned subsidiary Sancon Shanghai will acquire 51% equity of Beijing JDY. Sancon management believes this acquisition will contribute over US$15M revenue annually with healthy future growth projections.
Beijing JDY was established in 2005 in the Changping District of Beijing. It collects and processes scrap metal, waste paper, cardboards and plastics. Beijing JDY Services a population of 20 million within 16,800 square kilometers in the suburbs of Beijing. The company aims to expand its operations into additional areas of Beijing over the next three years. In 2009, under the government initiative to standardize and restructure the recycling operation across China, Beijing JDY became one of the only two recycling companies selected by the Beijing Municipal government to aggregate the fragmented recycling operations in the area. The initiative was part of the Chinese government's 11th 5-year plan to improve the industry image and urban environment in China.
The acquisition of BeijingJDY is expected to complete before the end of August 2011.
Guys how is this acquisition going to be financed? How much will it contribute to net profit? etc.