MedEx Subsidiary Aussie Apparel Group, Ltd., Announces LOI to
Acquire Hot Tuna And Other Apparel Brands from Federation Group
LOS ANGELES, Oct. 18 /PRNewswire-FirstCall/ -- Aussie Apparel Group, Ltd. (A MedEx Subsidiary,) (OTC Bulletin Board: MDEX) today announced their intention to acquire the global rights for various branded apparel properties from Australian based Federation Group (ASX: FDR). The acquisition, valued at approximately $7,500,000 U.S. Dollars will be paid to Federation in a combination of stock and cash once a definitive agreement can be reached over the next few weeks. An initial payment of cash and stock has been made to Federation Group totaling approximately $250,000 with further payments due as the definitive agreement is completed.
The principal brand in the proposed deal is the venerable surf and wakeboarding brand Hot Tuna. The other apparel properties include Xisle (surf/skate), Bulls Head, the children's surf brands Piranha Boy and Piranha Girl, and the music inspired Frontier Touring label.
As part of the proposed deal, Federation Group will retain an ownership stake in Aussie Apparel Group, Ltd. Federation Group Managing Director, John Fraser said, "We are extremely excited at what this deal can do for our various apparel brands in terms of the global opportunity. Obviously, the US market is the key in terms of gaining a global presence and increased revenue. We felt that Aussie Apparel Group and their management team led by President/CEO Bruce MacGregor represents the best opportunity for our shareholders to take advantage of the tremendous potential of the apparel brands worldwide. MacGregor has an extensive history of success within the extreme sports and sports wear industry at both LA Gear (President/COO) and Razor (COO)".
At the same time, MacGregor announced that upon completion of the deal, Rod Williams CEO of Hot Tuna in Australia will move with the brands to Aussie Apparel Group, Ltd. new corporate headquarters in Los Angeles. "With his extensive background in the industry, particularly as it relates to Rip Curl where he managed their International business, Rod is, and will be, an invaluable asset to us as we endeavor to grow these brands into global concerns." said MacGregor. In addition to managing the Hot Tuna and Piranha business in Australia, Williams will manage the International business of all four brands listed in the proposed deal.
Launched 33 years ago by surfers Richard and Jo-Anne Meldrum, the Hot Tuna brand is one of four original surf brands launched in the late Sixties out of Australia along with Quiksilver, Rip Curl and Billabong. "Hot Tuna is one the original authentic surf brands in the world. We look forward to telling the global surf audience about the amazing Australian heritage of this brand. Hot Tuna epitomizes surfing in Sydney," stated MacGregor. Hot Tuna has utilized the Piranha Boy and Piranha Girl labels as vehicles to penetrate the children's surf market. Aussie Apparel Group made it clear they intend to maintain that positioning.
The Xisle surf/skate brand is a mid tier brand with roots in Southern Australia, particularly around Victoria. Federation Group purchased this brand along with the Sea Level Surf and Skate retail chain back in July 2002. Both parties made it clear that the retail operation will remain in its entirety with Federation Group.
The Frontier Touring label is a music inspired apparel brand. Frontier Touring has been at the forefront in bringing the largest acts in music to Australia including Red Hot Chili Peppers, Madonna and Kylie Minogue. As Williams stated, "There are enormous synergies between Hot Tuna and Frontier Touring, as both have backgrounds generally rooted in real contemporary culture -- Hot Tuna in surfing and Frontier Touring in live music -- where music is a vital part of what surf culture is all about."
Summed up MacGregor, "Extreme sports and music are the new engines in driving contemporary fashion. With this in mind, we are extremely excited at the potential these brands offer up in terms of global revenue growth and building shareholder value for all stakeholders, including Federation Group."
MacGregor went on to state that Aussie Apparel Group would be making other key executive announcements over the next few weeks.
This release is intended as a forward-looking statement within the meaning of the Private Securities Litigation Reform Act of 1995. The risks and uncertainties that may affect the operations, performance development and results of the Company's business include but are not limited to fluctuations in financial results, availability and customer acceptance of our products and services, the impact of competitive products, services and pricing, general market trends and conditions, and other risks detailed in the Company's SEC reports. Actual results may vary materially from projected results.
Make Your Opinion Count - Click Here
-0- 10/18/2002 /CONTACT: Bruce MacGregor of Aussie Apparel Group, Ltd., +1-503-329-2833/
co: Aussie Apparel Group, Ltd. ST: Australia, California IN: REA SU: TNM -0- Oct/18/2002 13:48 GMT