A1 Investments & Resources (ASX: AYI) has entered a heads of agreement to acquire Singapore based Marvel Seeds, a worldwide distributor of Super Sorghum seeds from Japan.
Super Sorghum is a fast growing and high yielding crop, extremely drought tolerant and easily convertible to bioethanol.
Test farming in North Queensland is already underway.
Consideration for the acquisition is $5.5 million, comprised of $2 million is AYI shares and a $3.5 million convertible note.
Marvel Seeds has unaudited assets of $10.5 million, and a sales agreement with Sol Holdings Corp that is expected to provide $13 million in revenue during $2012.
Completion of the transaction is subject to shareholder and regulatory approval.
Prior to the completion of the acquisition, A1 is capitalised at just $500,000.
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