- Jatcorp’s (JAT) subsidiary Sunnya has entered a contract agreement to supply up to $32 million worth of their products to a major distributor
- Shandong Puxuan Trading Co supplies mother and baby products across 20,000 Kigo Baby stores in the Chinese region
- Sunnya has agreed to supply its full range of Neurio products to Shandong over the next 12 months, after previously working with the company for two years
- In return, the distributor will pay a $100,000 initial security bond, while Jatcorp’s subsidiary stands to make up to $32 million in revenue
- JAT shares were placed into a trading halt ahead of Thursday’s announcement with shares now trading for 1.9 cents each
Jatcorp’s (JAT) subsidiary Sunnya has entered a contract agreement to supply up to $32 million worth of their products to a major distributor in China.
The company in question is Shandong Puxuan Trading Co, which supplies mother and baby products across 20,000 Kigo Baby stores in the region.
Sunnya and Shandong have previously worked together over the last two year, with the distributor purchasing around $14 million worth of products across 2020.
Under this new 12-month agreement, Sunnya has agreed to supply its full range of Neurio products to Shandong over the next 12 months, with the possibility of another one-year extension.
The Chinese distributor must pay a $100,000 security bond and a deposit of 20 per cent of the order’s total before handing over the full amount once the product’s clear customs.
In return, the Jatcorp subsidiary estimates it could walk away with up to $32 million worth of revenue from the business.
JAT advises that the first security payment by Shandong has been received, with the new contract officially beginning on February 3.
The company also revealed its planned expansion of the ANMA manufacturing facility in Melbourne is progressing well and should be completed this month.
Shares in Jatcorp were placed into a trading halt ahead of Thursday’s announcement, with the stock now resuming trade.
The company’s securities are trading steady at 1.9 cents each at 3:02 pm AEDT.