Deal: eCargo Holdings Limited (ECG) has acquired 85 per cent of Metcash Export Services Pty Ltd.

Value: According to a statement from Thomson Geer, the consideration paid for the acquisition was $2.5 million plus 85 per cent of the net asset value of the business of $5.8 million and deferred compensation of up to $3.5 million funded by a combination of ECG’s existing cash reserves and available facility.

Area: M&A

Key players: The Thomson Geer team comprised partner Matt Reynolds and senior associate Dan Stumm.

Deal significance: ECG is described as an eCommerce, technology and specialist execution group of companies, operating in both China and Australia. It acts as a one-stop enabling partner for designer fashion, branded apparel and retail companies seeking to sell their products online in China by providing integrated online and offline technology and supply chain solutions, Thomson Geer explained.

Meanwhile, Metcash is touted as Australia’s leading wholesaler and distributor. It supplies and supports more than 10,000 independent retailers across the food, liquor and hardware sectors. Some of its retail customers include IGA, Mitre 10 and Cellarbrations, the firm said.

The 85 per cent acquisition by ECG includes Metcash subsidiary, Metcash Asia Limited, a wholly-owned foreign enterprise in China.

“The acquisition enables ECG to create a one-stop offering for businesses intent on capturing the attention of China’s growing consumer market – both online and via traditional bricks and mortar stores,” according to the Thomson Geer statement.

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Partner Matt Reynolds added: “This was an interesting cross-border transaction for our team that presented a transformational opportunity for our client, ECG, to expand its operations in mainland China under a continuing arrangement with Metcash.”