July 3, 2003

"Organic" Weedkiller???

AUSTRALIA: US INVESTORS EYE CERTIFIED ORGANICS WEEDKILLER

27 June

Certified Organics might soon be marketing its organic weed killer in America if two United States investors decide to go ahead with a $30 million joint venture with the company. Certified chairman Earl Stevens said the separate US investors had undertaken due diligence with a view to investing $30 million in the Auckland-based company. If either investment went ahead it would be as a joint venture, Dr Stevens said at the company's general meeting.

Certified's contribution to the joint venture would be the home and garden marketing rights in North, Central and South America for its pine based weed killer. The funding figure of $30 million was the estimated cost of a product launch in the Americas.  About $2 million would be spent on getting US Environmental Protection Agency registration for home and garden use of Organic Interceptor, the weedkiller while most of the money would be used for marketing. Dr Stevens said shareholders should see the possibility of the joint venture proceeding as "warm" rather than "hot" as months of detailed negotiations and investigation were needed before a possible deal was reached. Organic Interceptor would be launched on the New Zealand market by the end of this year.

The company has anticipated a deficit of $900,000 for the six months to 30 June, and a deficit of about $1.4 million by December 31.  For the 2002 calendar year, Certified posted a net after tax loss of $2.4 million.