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OEC 56.5¢

synerject refinancing deal announced

  1. snuff

    6,931 posts.
    This should be positive for OEC. Since Siemen's announced that they were getting out or partially selling down Synerject OEC has been going south. With this deal Siemens are putting in one of their own businesses, Rotax, so it should send a very positive signal to the market about what Siemens thinks of Synerject and by extension this should rub off on OEC. I think it is now time to buy. But, be warned, I hold a lot at a loss so can you trust me!!!

    Regards

    Desmond

    ASX RELEASE: S0 January 2003
    FUR IMMEDIATE RELEASE
    ASX Code: OEC
    MYSE Code: UE
    Berlin Code: ORE
    Frankfurt Code: UREA
    ORBITAL ANNOUNCES REFINANCING OF SYNERJECT
    Perth, Australia: Orbital Engine Corporation Limited (“Orbital”) today announced that it has reached
    agreement with Siemens VD0 Automotive Corporation on the terms of a restructuring and refinancing of
    their joint venture, Synerject LLC.
    Synerject is a US based manufacturer of air injectors and fuel rail assemblies fur Orbital’s marine and
    motorcycle customers. Synerject also supplies prototype air assisted direct fuel injection assemblies for
    automotive four-stroke and other programs.
    The current ownership structure of Synerject will remain, with both Orbital and Siemens each retaining a
    50% interest.
    Siemens and Orbital have agreed that Synerject’s scope will be broadened through the addition of
    Orbital’s marine and recreation systems business and a non-automotive systems business (Rotax) from
    the Siemens group.
    Mew financing arrangements have been put in place until September 30, 2006 and replace the earlier
    funding arrangements which matured on September 30, 2002. Orbital’s existing guarantee of 50% of the
    funding has nut increased and will not be called unless Synerject does not meet the terms and conditions
    of the revised facility.
    “The restructuring removes considerable market uncertainty in regards to the future uf Synerject and its
    ongoing operations” said Orbital’s Chief Executive Officer, Mr Peter Cook. “The marine and recreation
    systems business and the Rotax business to be contributed to Synerject will create the opportunity for a
    mure efficient and expedient service level to customers. The small profit and cash flow impact on Orbital
    from the transfer of its marine and recreation systems business to Synerject will be partly covered through
    identified cost savings within Orbital and Synerject’s improved profitability. These arrangements do not
    affect royalties being received by Orbital from this sector.”
    The arrangements will be effective from February 1, 2003.
    Mr Cook went on to say, “We are pleased to confirm that Synerject continues to be cash flow positive.
    Year to date, Synerject has exceeded budget expectations and contributed a profit to the Orbital
    consolidated results. Orbital is extremely pleased with the turnaround demonstrated by Synerject and is
    excited by its gruwth potential as a result of the restructuring”.
    CONTACTS: Ernail - [email protected] Website - www.orbenq.com
    Australia: Mr Peter Cook USA: Tel: 9866 794 0668
    Chief Executive Officer
    Tel: *69 8 9441 2391

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