Grand Toys International Limited has signed a term sheet to acquire 100% of Wham-O, Inc. (“Wham-O”) from Cornerstone Strategic Management Limited, a company owned and controlled by Raylin Hsieh, the wife of Grand Toys major shareholder, Jeff Hsieh.
Based in the US, Wham-O is a leading manufacturer of branded outdoor and leisure products with annual turnover of approximately $50 million in fiscal 2007 (unaudited). Wham-O designs, manufactures and markets some of the most recognizable brands in the world today, such as Frisbee, Slip 'N Slide, Hula Hoop, Morey Boogie boards, Snow Boogie and BZ Pro Boards.
“The new Board of Directors of Grand Toys, which was assembled in mid-2007, has been focusing on developing a new direction and strategy for Grand Toys to give the company a platform for growth” comments David Howell, CFO of Grand Toys. “We believe the acquisition of Wham-O represents a transformational opportunity for Grand Toys and it will become the key asset around which we will build our business. In addition, the divestiture of the low margin, non-core Hua Yang and Kord manufacturing businesses frees up significant working capital for the company and allows us to reduce substantially our bank debt, creating a much healthier balance sheet.”
A Special Committee of the Board has been formed to oversee the transaction and the Special Committee will be delivering a recommendation to the shareholders. Latitude Capital Group, an Asian investment banking firm, has been appointed to arrange the acquisition financing for the company. Jones Day, an international law firm, has been appointed to represent the company on the transaction.
About Grand Toys International Limited:
Grand Toys International Limited, through its Hong Kong, PRC and US operating subsidiaries, develops, manufactures and distributes toy and toy-related products throughout the world; prints and assembles books and specialty packaging; and develops and manufactures party goods.