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BUSINESS |
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Fuel for fishing & cargo vessels along the east coast of China |
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Northern China |
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As the largest privately owned (pre-IPO) engaged in marine fuel industry in northern China, AMCF holds a market share of approximately 25% in the area of Bohai Bay. |
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Produce, stores, distributes and trades the blended marine fuel oil for cargo and fishing vessels. |
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Backed by core facilities, including storage tanks, tankers and berths, AMCF’s sales network covers major depots along the towns of Dandong, Shidao and Shipu, which are well-known for their fishing tradition and industry |
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East coast of China |
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Through a subsidiary, Xingyuan, AMCF is a leading marine fuel supplier along the coast of east China. |
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Southern China |
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In December 2008, AMCF entered into an agreement with the shareholder of Xiangshan Nanlian, which is located in Shipu town, Xiangshan county, Zhejiang Province. Purchased a 63% ownership stake in Xiangshan Nanlian for a purchase price of approximately $2.2 million (RMB15.12 million). This acquisition allowed AMCF to build a stronghold in an important fishing port in southern China. |
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AMCF estimates the market for marine fuel in Shipu to exceed 300,000 tons per year, which, at current prices equates to approximately $240 million. |
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AMCF believes that Xiangshan Nanlian’s presence in the market combined with AMCF’s blended marine fuel production capabilities will enable AMCF to increase market share to 15 – 20% and to continue AMCF’s expansion through acquisitions of local market participants and intensified marketing efforts |
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Shandong Province |
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In late December 2008, AMCF entered into an agreement with shareholders of Rongcheng Xinfa to acquire its 90% ownership stake in the entity for a purchase price of approximately US$1.45 million (RMB9.9 million). Rongcheng Xinfa engaged in distribution of marine fuel oil in the surrounding areas of Shidao town, Rongcheng city, Shandong Province, with heavily concentrated and developed fishing industry. |
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AMCF currently sells 350,000 tons per year which represents approximately 33% of the market. |
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AMCF intends to expand its business by enhancing its relationships with existing customers, diversifying products to meet customers’ needs and pursuing the strategy of acquisitions of local players in the marketplac |
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PRODUCTS |
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Includes cargo vessel fuel classified as CST180 and CST120, fishing boat fuel classified as #3 and #4, which are close substitutes for diesel used throughout the region’s fishing industry. |
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GROWTH STRATEGY |
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Increase share of retail sales since such sales had shown to be less price-sensitive than our sales to the distributors |
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Acquire and own retail facilities to reduce the risk of opportunistic negotiations from retail customers during periods of volatile oil prices and |
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Build retail points in strategic locations (often close to other, recently acquired locations) to capture a majority of active local markets. |
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USE OF IPO PROCEEDS of $18mm |
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9.3% Sales & Marketing
9.9% Research & Development
26.5% Capital Improvements
35.1% Potential Acquisitions
19.2 Working Capital |
