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The Canadian company announced on the 11th of July that it has signed a contract to supply approximately USD $68,000,000 in EcoScapeTM housing for large scale projects in Haiti and Ghana.
The contract with Barclays Gedi Group ("BGG"), a US based construction conglomerate, follows 16 months of joint efforts attempting to secure large scale construction projects in Haiti and other jurisdictions. In order to service this contract ICI will immediately begin establishing a second manufacturing facility in South Carolina, USA ("SC Facility").
The 2,000,000 square feet of housing represent approximately 40% of the planned output capacity of the SC Facility. The projects are estimated at $68 million dollars based on the current $34 per square foot price of ICI's 880 square foot house design. ICI has committed to start supplying homes as soon as the SC facility is up and running. Management will provide more details on the SC Facility in the near future, but it is expected that first EcoScapeTM houses will be shipped in the first quarter of next year.
Under the terms of the Contract ICI has granted BGG the Right of First Refusal to purchase up to 75% of the product output of the SC Facility for a period of 5 years. If the ROFR is exercised, ICI sales to BGG could reach approximately $112 million per annum.
ICI is currently involved in the development of several other large scale housing projects and is diligently working to secure purchase orders for the balance of the capacity of the SC Facility for 2012 and beyond. Projects in the pipeline include the $4 Billion Building Back Better Communities initiative in Haiti, the recently announced initiative in Antigua and a number of other ventures worldwide.
"ICI's EcoScapeTM house is the perfect solution for large scale housing projects we have underway in various parts of the world because they are not only weather impervious but are easily and quickly assembled by local labour," said Wayne Gerl, President of BGG. "We believe this product has the potential to significantly grow our business and look forward to a continuous, long term relationship with ICI," he added.
"This is a game changer for ICI. One we have been working on for the last two years. I have to congratulate the entire ICI team that has persevered through long, frustrating delays and has worked very hard to establish EcoScapeTM as the product of choice for large scale affordable housing contracts," said ICI President and CEO Terry Ball. "We have a lot of hard work ahead of us, but I believe we haven't even scratched the surface in terms of market penetration and will be able to accelerate project roll out once the SC facility is up and running," he said.
About Barclay's Gedi Group.In 2003, the principals of Barclays Group International, Gedi Construction and Gerl Construction merged to form the Barclays Gedi Group ("BGG"), an international construction consortium with over 100 years of combined experience delivering large-scale development projects across the globe. Recently, BGG has been expanding rapidly in emerging economies with construction projects and operations in Algeria, Libya, Qatar and Tunisia.
To date, Barclays Gedi Group has implemented more than 226 projects internationally. Projects range from retail centers to large-scale residential projects in all corners of the world.
About Innovative Composites International Inc.Headquartered in Toronto, Canada Innovative Composite International ("IC": TSX-V) is a high tech engineering and manufacturing company that is successfully commercializing a patent protected line of state-of-the-art composite products targeted at the multi-billion dollar transportation and housing markets.
Led by a team of commercialization experts ICI has adopted a tier two business model: it designs and manufactures game-changing products and partners with established companies in its target markets to utilize their sales channels for faster product roll-out.
This strategy and the superior characteristics of the products have resulted in rapidly growing sales in both markets and opened up opportunities that could lead to large scale contracts on an ongoing basis.
More information: www.innovativecompositesinc.com