China Direct Forms New Joint Venture to Expand Basic Materials Segment
September 17 2008 - 8:30AM
PR Newswire (US)
CDI Beijing Joint Venture Receives Business License from Chinese
Government DEERFIELD BEACH, Fla., Sept. 17 /PRNewswire-FirstCall/
-- China Direct, Inc. (NASDAQ:CDS), a U.S. company that owns
controlling stakes in a diversified portfolio of Chinese entities
and assists Chinese businesses in accessing the U.S. capital
markets, announced today that it previously disclosed joint
venture, CDI (Beijing) International Trading Co., Ltd., ("CDI
Beijing") was granted a business license by the Chinese government
to engage in the distribution of steel and lumber products in
China. Under the terms of the previously disclosed joint venture
agreement, CDI Shanghai Management Co., Ltd. ("CDI Shanghai"), a
wholly owned subsidiary of China Direct, will invest approximately
$3.73 million in CDI (Beijing) to obtain a 51% interest in the
joint venture. CDI Shanghai made its initial investment of $750,000
and will contribute the remaining $2.98 million to CDI Beijing on
or before June 30, 2009. CDI Beijing will distribute to end users
in China and abroad a variety of basic material products including
steel and wood for various suppliers. Management believes CDI
Beijing can vertically integrate with our zinc, lead and magnesium
operations by providing additional sales and distribution
relationships. Management is confident in CDI Beijing's management
team, which has built a network of relationships in a number of
domestic and foreign markets, and anticipates CDI Beijing's
operations will begin contributing to China Direct's bottom line as
soon as the fourth quarter of 2008. In addition to being a strong
contributor to performance in 2009 from its distribution of steel
and wood products, CDI Beijing is seen by management as having the
ability to increase performance in its zinc, lead and magnesium
operations by leveraging its customer relationship base which adds
potential new sales channels. China Direct intends make every
effort to maximize the potential distribution synergies among our
various portfolio companies. Dr. James Wang, CEO and Chairman of
China Direct, indicated, "We are pleased to welcome CDI Beijing
into the China Direct family as we continue to expand our Basic
Materials Segment. We are confident CDI Beijing will be accretive
to our financial performance in the fourth quarter of 2008 and into
2009. The formation of CDI Beijing is part of our strategic plan to
grow our basic materials segment to $200 million in revenue in
2009. We anticipate maximizing the customer relationships developed
by CDI Beijing management in growing these new product lines to our
basic materials segment. In addition, management is evaluating
other potential acquisitions in the chemical industry as we move
forward into 2009 and we are confident CDI Beijing will play an
important role in the distribution of any new products as well as
our current product offerings within this segment." About China
Direct, Inc. China Direct, Inc. (NASDAQ:CDS) is a diversified
management and advisory services organization headquartered in the
U.S. Our management services division acquires a controlling
interest in entities operating in China. Our ownership control
enables China Direct to provide management advice, as well as
financing to Chinese entities. This infrastructure creates a
platform to expand business opportunities globally while accessing
the U.S. capital markets. Our advisory services division provides
comprehensive advisory and consulting services to Chinese entities
seeking to access the U.S. capital markets. As a direct link to
China, China Direct serves as a vehicle allowing investors to
directly participate in the rapid growth of the Chinese economy in
a diversified and balanced manner. For more information about China
Direct, please visit http://www.chinadirectinc.com/ . DISCLOSURE
NOTICE: In connection with the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995, China Direct,
Inc., is hereby providing cautionary statements identifying
important factors that could cause our actual results to differ
materially from those projected in forward-looking statements (as
defined in such act). Any statements that are not historical facts
and that express, or involve discussions as to, expectations,
beliefs, plans, objectives, assumptions or future events or
performance (often, but not always, indicated through the use of
words or phrases such as "will likely result," "are expected to,"
"will continue," "is anticipated," "estimated," "intends," "plans,"
"believes" and "projects") may be forward-looking and may involve
estimates and uncertainties which could cause actual results to
differ materially from those expressed in the forward-looking
statements. These statements include, but are not limited to, our
expectations about our future success, our ability to successfully
develop our planned steel and wood product distribution business in
a cost effective manner that enhances our financial condition. We
caution that the factors described herein could cause actual
results to differ materially from those expressed in any forward-
looking statements we make and that investors should not place
undue reliance on any such forward-looking statements. Further, any
forward- looking statement speaks only as of the date on which such
statement is made, and we undertake no obligation to update any
forward-looking statement to reflect events or circumstances after
the date on which such statement is made or to reflect the
occurrence of anticipated or unanticipated events or circumstances.
New factors emerge from time to time, and it is not possible for us
to predict all of such factors. Further, we cannot assess the
impact of each such factor on our results of operations or the
extent to which any factor, or combination of factors, may cause
actual results to differ materially from those contained in any
forward-looking statements. This press release is qualified in its
entirety by the cautionary statements and risk factor disclosure
contained in our Securities and Exchange Commission filings,
including our Annual Report on Form 10-K for the year ended
December 31, 2007 and our reports on Form 10-Q. DATASOURCE: China
Direct, Inc. CONTACT: Investor Relations: James Kautz, , or Todd
Atenhan, +1-404-806-1393, both of EPOCH Financial Group, Inc.; or
Richard Galterio, Executive Vice President of China Direct, Inc.,
+1-877-China-57, Web site: http://www.chinadirectinc.com/
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