American Oriental Bioengineering Comments on Recent Property Purchase
January 09 2009 - 12:24PM
PR Newswire (US)
NEW YORK, Jan. 9 /PRNewswire-Asia-FirstCall/ -- American Oriental
Bioengineering, Inc. (NYSE:AOB) ("AOBO" or "the Company"), a
leading marketer, distributor and manufacturer of pharmaceutical
and healthcare products in China, today commented on its recent
purchase of buildings and land in the Beijing
Economic-Technological Development Area (BDA) for approximately
$70.0 million. Mr. Tony Liu, Chairman and Chief Executive Officer
of AOBO, stated, "Our recent property purchase in the BDA is a
long-term investment in AOBO which builds out our multi-functional
headquarters and centralizes our management in Beijing, while
deepening our presence in a very important development region
focused on attracting leading pharmaceutical companies.
Additionally, at a time when our significant cash position yields
negative real returns, this fixed asset allocation does not
constrain our financial flexibility, but rather, we believe,
positions us to secure government support in various forms, such as
R&D grants related to the PRC's stimulus plan as well as
potential low-interest bank loans." Liu continued, "While we have
not always elaborated on our motivations at the time, due to
economic, competitive and other reasons, we consistently and
effectively have navigated China's complex economic and competitive
landscape, and have created significant shareholder value in the
process. We believe this property purchase is no departure from
AOBO's proven past." "Our goal remains consistent. We continue to
focus on becoming a top-five pharmaceutical company in China and we
are aggressively yet prudently pursuing organic and acquisition-led
growth. We emphasize that China's challenging economic environment
and the uncertainty created by the upcoming healthcare reform
necessitates that we remain flexible, influential and creative in
our acquisition strategy. We intend to consider a variety of
strategic opportunities in technology, new products, partnerships
and minority or majority stakes, in order to ultimately create
long-term shareholder value. Lastly, we note that AOBO's consistent
internally generated cash flow ensures that we do not anticipate
returning to the capital markets in the coming year, and also
bolsters our competitive and negotiating position versus peers,"
concluded Liu. Details of the Transaction The Company completed a
Purchase Agreement with Beijing Century East Fuel Power Science
& Technology Research and Development Co. Ltd., through which
AOBO acquired buildings occupying 14,615 square meters (157,314
square feet) as well as the land use right to 22,008 square meters
(5.4 acres) of land on which the building is located in the Beijing
Economic-Technological Development Area. The cash transaction of
$70.0 million was funded from the Company's internally-generated
cash flow. About American Oriental Bioengineering Inc. American
Oriental Bioengineering, Inc. is a pharmaceutical company dedicated
to improving health through the development, manufacture and
commercialization of a broad range of prescription and over the
counter products in China. Statements made in this press release
are forward-looking and are made pursuant to the safe harbor
provisions of the Securities Litigation Reform Act of 1995. Such
statements involve risks and uncertainties that may cause actual
results to differ materially from those set forth in these
statements. The economic, competitive, governmental, technological
and other factors identified in the Company's filings with the
Securities and Exchange Commission, including the Form 10-Q for the
quarter ended September 30, 2008, may cause actual results or
events to differ materially from those described in the forward
looking statements in this press release. The Company undertakes no
obligation to publicly update or revise any forward-looking
statements, whether because of new information, future events, or
otherwise. DATASOURCE: American Oriental Bioengineering, Inc.
CONTACT: Integrated Corporate Relations, Ashley M. Ammon,
+1-203-682-8200 for American Oriental Bioengineering, Inc.
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