HANNY Magnetics, the battling floppy disk-maker, yesterday posted gains after disclosing plans to boost revenue through a multimillion dollar deal to sub-license its Memorex trademark in Europe.
The shares, which rose by eight cents to 64 cents, were some of the day's most heavily traded with more than 21 million changing hands.
The company said on Monday that BASF, the German Chemical giant, would have exclusive rights to the brand name across Europe and would also buy some of the company's inventory.
Hanny chairman Wong Sun said the deal should generate at least $11 million a year in royalties.
BASF will pay annual royalties of around $12 million for sales up to $611 million. There will be an additional two per cent payment for any additional sales.
The company will pay an additional $93 million for Memorex's inventory and distribution contracts.
Hanny Magnetics has been struggling since the acquisition of Memtek Products from Tandy for US$65 million in November 1993.