XI'AN, China, July 8, 2016 /PRNewswire/ -- China Green
Agriculture, Inc. (NYSE: CGA) ("China Green Agriculture",
"CGA" or the "Company"), a company that mainly produces
and distributes humic acid-based compound fertilizers, other
varieties of compound fertilizers and agricultural products through
its subsidiaries in China, today announced that its
wholly-owned subsidiary Shaanxi TechTeam Jinong Humic Acid Product
Co., Ltd., a company organized under the laws of the People's Republic of China ("Jinong"), as
authorized by the board of directors of the Company and Jinong,
entered into (i) Strategic Acquisition Agreements (the "SAA"), (ii)
Agreements for Convertible Notes (the "ACN"), and (iii) VIE
Agreements, with the shareholders of the group of six companies on
June 30, 2016.
Transaction Highlight:
- The strategic acquisitions take the first leap forward to
establish a brand new sales segment of agriculture related
products, and to transform the company into a platform centered
venture.
- The total purchase price includes $6
million in cash and $8 million
in convertible notes.
- Convertible notes are due in 3 years with an annual fixed rate
of 3%.
- The effective conversion price of the convertible notes will be
no less than $5.00 per share*.
- The acquirees are located in the following four provinces in
China, there are:
Province
|
Number of the
acquirees
|
Henan
province
|
1
|
Jilin
province
|
1
|
Shaanxi
province
|
2
|
Xinjiang Uygur
Autonomous Region
|
2
|
*Such a conversion occurs if the performance of the acquirees hit a
minimum of 10% of annual compound growth rate within the three
years and if Jinong elects to have the note converted into the
common shares of CGA. Whether to convert the notes into cash,
equity or a combination of both is at the discretion of Jinong.
(The detailed summary of the transaction is available at:
https://www.sec.gov/Archives/edgar/data/857949/000114420416111996/v443872_8k.htm)
These six companies are located in different provinces or
regions in China. They all are the
dominant participants in their local markets and are all conducting
business mainly in agriculture sales and distribution
industry, including fertilizers, pesticides, seeds and food.
"We had successfully closed this batch of acquisitions. Its
success is the result of joint efforts from all involved parties.
Our new team members, the founders of these newly joined companies,
are sharing the same value with us. We own the same vision, the
vision to transform ourselves from a manufacturer and a wholesaler to a platform with unlimited
capacity to serve the underdeveloped but limitless rural
market in China," said Mr. Zhuoyu Li, President of the
Company, who is the architect and leader of the acquisitions. "Upon the close of the
acquisitions, we are penetrating
into the four market areas in
which these newly joined companies are based. We are
leaping toward our goal of
building one of the largest platform ventures for rural market in
China."
"I'm very glad with the success of the acquisitions. This is a
great first step for our
transformation," said Mr.
Tao Li, the Chairman and CEO of the Company. "Jack Ma
said that today is difficult, tomorrow will be more difficult, but
the day after tomorrow will be beautiful. I believe the same. I am
confident Zhuoyu and the team will
thrive in the journey."
About China Green Agriculture, Inc.
The Company produces and distributes humic acid-based compound
fertilizers, other varieties of compound fertilizers and
agricultural products through its wholly-owned subsidiaries, i.e.:
Shaanxi TechTeam Jinong Humic Acid Product Co., Ltd. ("Jinong"),
Beijing Gufeng Chemical Products Co., Ltd. ("Gufeng"), and a
variable interest entity, Xi'an Hu County Yuxing Agriculture
Technology Development Co., Ltd. ("Yuxing"). Jinong produced and
sold 130 different kinds of fertilizer products as of March
31, 2016, all of which are certified by the government of the
People's Republic of China (the "PRC") as Green Food
Production Materials, as stated by the China Green Food Development
Center. Jinong currently markets its fertilizer products to private
wholesalers and retailers of agricultural farm products in 27
provinces, four autonomous regions, and three
central-government-controlled municipalities in the PRC. Jinong had
1,064 distributors in the PRC as of March 31, 2016. Gufeng,
and its wholly-owned subsidiary, Beijing Tianjuyuan Fertilizer Co.,
Ltd., are Beijing-based producers of compound fertilizers,
blended fertilizers, organic compound fertilizers, and mixed
organic-inorganic compound fertilizers. As of March 31, 2016,
Gufeng produced and sold 332 different kinds of fertilizer
products, and had 299 distributors in the PRC. For more
information, visit http://www.cgagri.com. The Company routinely
posts important information on its website.
Safe Harbor Statement
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
concerning the Company's business, products and financial results.
The Company's actual results may differ materially from those
anticipated in the forward-looking statements depending on a number
of risk factors including, but not limited to, the following:
general economic, business and environment conditions, development,
shipment, market acceptance, additional competition from existing
and new competitors, changes in technology, the execution of its
ten-year growth plan, a satisfactory conclusion of the pending
securities class action litigation and various other factors beyond
the Company's control. All forward-looking statements are expressly
qualified in their entirety by this Safe Harbor Statement and the
risk factors detailed in the Company's reports filed with the SEC.
China Green Agriculture undertakes no duty to revise or update any
forward-looking statements to reflect events or circumstances after
the date of this release, except as required by applicable law or
regulations.
For more information, please contact:
China Green Agriculture, Inc.
Ms. Ting Shi (English and Chinese)
Tel: +86-29-88266500
Email: tingshi@cgagri.com
Related Links
http://www.cgagri.com
https://www.sec.gov/Archives/edgar/data/857949/000114420416111996/v443872_8k.htm
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/china-green-agriculture-announces-strategic-acquisitions-300295854.html
SOURCE China Green Agriculture, Inc.