Sep 27 2010
Gushan Environmental Energy Limited ("Gushan" or the "Company"; NYSE: GU), a leading producer of biodiesel in China, today announced that it has entered into definitive agreements (the "Agreements") to acquire a 67% beneficial ownership interest in Mian Yang Jin Xin Copper Company Limited ("Jin Xin"), a PRC-based company that is currently engaged in the business of copper recycling, through a series of transactions ("Transactions") in exchange for up to 24 million newly issued ordinary shares of the Company, valued at US$1.00 per share, hence issued at a premium of 177.8%, with reference to the closing price of Gushan's American Depository Shares ("ADS") on September 21, 2010 at US$0.72 per ADS (each representing two ordinary shares), subject to adjustment pursuant to an earn-out arrangement, and a capital contribution to Jin Xin of RMB30.0 million (approximately US$4.5 million).
The closing of each of the Transactions is subject to the satisfaction of customary closing conditions, including obtaining approvals from relevant PRC governmental authorities.
"We are very pleased to have entered into these agreements with Jin Xin. We believe that this acquisition is in line with our goal of leveraging our balance sheet by making strategic investments in environmental businesses," said Jianqiu Yu, Chairman and Principal Executive Officer of Gushan. "In our view, this expansion into the copper recycling business will contribute positively to the overall financial performance of our group."