Message #11 From:
Stock News Bot Date: October 6, 2005 04:29:00 AM
DIGG News Digital Gas to Distribute Consumer Products in North America for its Vietnamese Partner
NEW YORK--(BUSINESS WIRE)--Oct. 6, 2005--Digital Gas, Inc. (OTC Pink Sheets:DIGG) announced today that it has agreed to act as a distributor for Lamdo Co. Ltd. of Ho Chi Minh City, Vietnam for a variety of high-quality consumer products manufactured in Vietnam. Lamdo Co. is a partner on several energy related projects in Vietnam with Entropic Energy and Digital Energy & Farming Asia.
"This business opportunity should significantly increase the cash flow and profitability of Digital Gas, as the products are of the highest quality and have excellent margins," said Austin Marshall, a Director of Digital Energy & Farming, who arranged the deal for Digital Gas.
The initial products to be distributed are widely popular furniture for the home and business markets. Digital Gas has arranged for dock space in Florida for the sale of aggregate products. The same location will receive the furniture from Vietnam. Southern Florida is the initial target market and Digital Gas has a sales and marketing team already contacting several large furniture chains. "Based on quality and pricing, the products will sell rapidly," added Mr. Marshall. Lamdo will supply approximately of $100 million of product annually.
Digital Gas is projected to have a minimum outlay of investment to support this distribution business which has the potential to add tens of million of dollars in net profits annually.
Digital Gas is also evaluating opportunities to establish manufacturing capabilities with Lamdo for specialty parts for its energy business and for an energy efficient car using special materials and energy saving technologies. Mr. Marshall, currently in Vietnam seeking additional business opportunities, indicated that the company's business in Vietnam could increase significantly. "Vietnam imports large quantities of gasoline and ethanol. We can make ethanol as planned for East St. Louis and we have access to oil which can be refined into gasoline through new refining technologies. This would greatly expand our presence and profitability in Vietnam," said Mr. Marshall.
Digital Gas was recently informed by a commercial finance company that its application for $30 million in debt has been accepted based on an initial due-diligence and review of information it provided. A commitment to fund will be made after a successfully completed due-diligence and mutual acceptance of terms and conditions. The interest rate on a debt investment would be Prime + 1.5 - 2.5% per annum. If the financing is completed, Digital Gas would retain $5 million less fees and commissions for its working capital and would extend $25 million to five of its subsidiaries that it intends structuring as separate operating companies. The funds to be used by the respective subsidiaries would serve as equity to support project debt that has been arranged.
Digital Gas is close to finalizing the acquisition of a major aggregate deposit in the US that could service the needs of the hurricane ravaged Gulf Coast areas.
