ANTI-COUNTERFEIT MOVE THE REAL DEAL FOR CHARTER
Written on the 4 December 2015 by Jenna Rathbone
LISTED investment firm Charter Pacific (ASX:CHF) has signed a stock purchase agreement with a New York-headquartered company that manufactures and distributes patented anti-counterfeiting technology.
Charter Pacific, a Surfers Paradise company, will acquire 100 per cent of Integrity Systems, which has been operating for more than 15 years with sales offices in the US, Hong Kong, China and Sydney.
Integrity has annual revenue of $US12.5 million, which is projected to rise to $67.2 million by 2018.
The $35.2 million acquisition is being effected through the issue of 704 million Charter Pacific shares at 5c each and the share issue is subject to shareholder approval.
While Charter Pacific's current investments are in the mining and resources sector, in particular iron ore mining and exploration, and gold exploration in Mauritania, West Africa, executive chairman Kevin Dart (pictured) says the anti-counterfeiting industry provides great opportunities for investor growth.
"It is a large opportunity for shareholder value growth and it is quite simply one of the best opportunities we have had, and we have looked at a number of ones over the last year in particular," says Dart.
"Integrity Systems already has income, it is an established business, it has professional people running the company and there is tremendous growth and upside in the opportunity.
"This technology opportunity for anti-counterfeiting and data capture is in the right space at the right time."
Integrity Systems' international patented technology combines three integrated and layered processes - authentication, identification and track and trace capability into one label.
The company developed a production process that allows it to print any form of information, logo or visual identity recognition into a micro thread or fibre which is woven into a brand.
The anti-counterfeit solutions can be applied to almost any fabrication and substrate, to any part of a product, large or small, and it ultimately provides multi levels of brand protection layered with client and consumer data integration via the use of a mobile phone app.
"If you look at companies like Alibaba, in excess of 45 per cent of what is sold through the Alibaba platform is counterfeit - this opportunity assists with that," says Dart.
"And this is not all about counterfeit; Integrity Systems also captures data and data retention and what that means is the products can be tracked by the manufacturer."
Integrity has assisted big-name brands such as Adidas, Abercrombie and Fitch, Billabong, Calvin Klein Jeans, Nordstrom and Target.
Dart says he is travelling to Hong Kong in the coming weeks to speak with one of the world's largest apparel companies, which he hopes will end up using the anti-counterfeiting material.
Charter Pacific's shares rose as much as 53 per cent to 4.6c following news of the acquisition.
Author: Jenna Rathbone
About: Jenna Rathbone is a Queensland-based journalist who writes on a range of issues including business and property affairs and social issues.Connect via: Twitter