China Growth Equity Investment Ltd. To Merge With China Dredging Group Co., Ltd. And Acquire Fujian Provincial Pingtan County Ocean Fishing Group Co., Ltd.
NEW YORK, Oct 25, 2012 /PRNewswire/ -- China Growth Equity Investment Ltd. (Nasdaq: CGEI; CGEIU; CGEIW) ("CGEI"), a special purpose acquisition company ("SPAC"), China Dredging Group Co., Ltd. ("CDGC") and Fujian Provincial Pingtan County Ocean Fishing Group Co., Ltd. ("Pingtan Fishing") today announced that CGEI and CDGC have entered into a definitive merger agreement for CGEI to merge with CDGC and that CGEI and Pingtan Fishing have entered into a definitive agreement for CGEI to acquire Pingtan Fishing. The parties expect the transactions to provide CDGC and Pingtan Fishing with necessary financial resources for the companies' next stage of growth.
CDGC, a British Virgin Islands holding company, is one of the leading independent (not state-owned) providers of dredging services in the PRC through its PRC subsidiary Fujian Xing Gang Port Service Co., Ltd., or Fujian Service. Pingtan Fishing is a rapidly growing fishing company and provider of quality seafood in the PRC.
The combined entity, which will be renamed "Pingtan Marine Enterprise Ltd.," intends to apply to be listed on NASDAQ under the ticker symbol "PME". Upon completion of the merger and the acquisition, successful entrepreneur Xinrong Zhuo, the founder, Chairman and controlling shareholder of both CDGC and Pingtan Fishing will be the chairman of the combined company.
The business combination is subject to the approval of CGEI's shareholders as well as other customary closing conditions. Assuming the closing conditions are met, the business combination is expected to be completed during the first quarter of 2013.Pro forma fiscal year 2011 revenues and net income for CGEI, CDGC and Pingtan Fishing were $252.6 million and $106.8 million, respectively. For the 6 months ending June 30, 2012, pro forma combined revenues were $145.0 million and net income was $49.4 million. "CGEI's combination with CDGC and Pingtan Fishing is the culmination of our search for a successful company with a proven track record of profitability and attractive growth prospects," said Xuesong Song, China Growth's board chairman. "We believe that CDGC's highly profitable dredging business represents a unique opportunity as one of the largest dredging providers in China. Pingtan Fishing provides the combined company with a strong and fast growing platform in a fragmented industry." Added Mr. Zhuo, the Chairman of CDGC: "We are truly excited about the immediate positive impact of the capital this transaction will provide to help Pingtan Marine Enterprise execute on its long-term growth strategy with greater access to capital and a public currency to support additional future growth."
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