Trading Symbol: MCV
TORONTO, Jan. 14 /CNW/ - McVicar Resources Inc. ("McVicar") is pleased to
announce that it has reached a letter of intent to acquire the remaining 49%
of equity interest in McVicar (Hongkong) Advanced Materials Co. Ltd. ("MAM"),
from Shining Palace Holding Co. Ltd. ("SPH") and Sanlong Chemical Co. Ltd.
("SC"). McVicar currently owns 51% of MAM and after giving effect to the
acquisition of 49% of MAM, McVicar will have 100% ownership.
The parties have agreed to sell their 49% interest at a value of
63.7 million RMB (approximately CDN $8.7 million). MAM is a Hong Kong based
holding company that owns the chemical operations in China of Hongbo Chemical
Co. Ltd. ("Hongbo") and Changlong Chemical Co. Ltd. ("Changlong"). SPH, a
British Virgin Island company, has agreed to accept 51.35 million RMB
(approximately CDN $7 million) in debt with a term of up to one year and an
annual interest rate of 8% in return for its 39.5% interest in MAM. Cash
payment of 12.35 million RMB (approximately CDN $1.7 million) will be made to
SC in return for its 9.5% interest in MAM.
Completion of the acquisition is subject to applicable regulatory
Hongbo is a developer, manufacturer and supplier of specialty chemical
products used in the personal care, pharmaceutical and industrial chemical
markets. Hongbo's customers include major international and Chinese chemical
companies. The company has recently received a series of orders from
international companies, including DuPont. The Company has clarified the terms
of a September 7, 2007 press release announcing an order from DuPont USA. The
terms of the deal include Hongbo agreeing to supply up to CDN $15 million of
chemical products over three years at approximately CDN$5 million per year.
The agreement can be automatically renewed for another two years in 2010 and
then again automatically renewed in 2012 for an additional two years.
Changlong is a developer, manufacturer and supplier of specialty chemical
products used in the pharmaceutical industry. The company possesses the
technologies of chemical synthesizing under high pressure. Its customers are
mainly Chinese pharmaceutical companies.
This press release contains forward-looking statements which reflect the
Corporation's current expectations regarding future events. The
forward-looking statements involve risks and uncertainties. Actual results
could differ materially from those projected herein. Expectations are based on
reasonable assumptions and the company can give no assurance that expectations
The TSX Venture Exchange does not accept responsibility for the adequacy
or accuracy of this release.
For further information:
For further information: Dr. Gang Chai at: 55 University Avenue, Suite
605, Toronto, ON, M5J 2H7, Tel: (416) 366-7420, Fax (416) 366-7421,