Avgol Nonwoven Industries Ltd. (TASE:AVGL) has acquired most of the assets of its distributor, Cleaver Associates Inc., for $7 million. Cleaver is Avgol's exclusive distributor in North America and non-exclusive distributor in other territories. It was responsible for 78% of Avgol's sales in 2009, including all its sales to Proctor & Gamble (NYSE: PG)
Avgol will acquire Cleaver's assets, including its trademark "Cleaver Associates", know-how, goodwill, and tangible assets that it developed. Avgol will incorporate Cleavers's sales and distribution activities into its own operations.
Avgol will finance the acquisition from its own resources.
Avgol CEO Shlomo Liran said, "Avgol recently announced $80 million in investments, which are expected to expand production capacity to 140,000 tons. The expansion of production capacity will be carried out in 2011-12 at the company's site in the US and on another continent. The acquisition of Cleaver is a natural progression of this strategy."
After a gain at the opening, Avgol's share price fell 0.3% in morning trading to NIS 2.74, giving a market cap of NIS 821 million.
Published by Globes [online], Israel business news - www.globes-online.com - on December 27, 2010
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