Empire Industries Ltd. is entering a joint venture with a subsidiary of China-based Zhejiang ZF Investment Co. Ltd., also known as ZZG.
Winnipeg-based Empire will own 51 per cent of the joint venture, which will design and manufacture amusement rides for the Asian market.
Empire also fabricates steel for construction projects in Western Canada and China.
The Canadian junior company will provide an initial $2-million capital investment in the new venture and ZZG will provide 1.9 million.
In a related move, a ZZG subsidiary – Canada Zhoufa Agricultural Holding Company Ltd. – will invest a total of $4.25-million in Empire by purchasing equity and a $2-million convertible debenture through a private placement.
Insiders of Empire will purchase 9.6 million units of the equity placement and Canada Zhoufa will acquire 50.4 million units, which will be priced at five cents each.
Each unit will include one common share of Empire and a half warrant, which can be used to buy additional shares at agreed prices over the next five years.
Its shares closed Tuesday at at 4.5 cents at the TSX Venture Exchange, giving the Winnipeg-based company a market value of about $9-million.
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