Zongshen PEM Power Systems Inc. Announces Normal Course Issuer Bid


    VANCOUVER, Oct. 15 /CNW/ - Zongshen PEM Power Systems Inc. ("ZPP" or "the
Company") (TSX:ZPP), announced today that it will, subject to the approval of
The Toronto Stock Exchange ("the Exchange"), make a Normal Course Issuer Bid
(the "Bid") to purchase through the facilities of the Exchange, from time to
time, as it considers advisable, up to 3,045,211 of the issued and outstanding
Common Shares (being approximately 5% of the 60,904,230 Common Shares
outstanding at September 30, 2008).
    The Bid will commence on or about November 15, 2008 after the filing of
the Company's third quarter financial statements and terminate on the earlier
of the anniversary of the Bid or the date on which ZPP acquires all of the
shares sought pursuant to the Bid. The price which ZPP will pay for any shares
purchased by it will be equal to the prevailing market price of such shares on
the Exchange at the time of purchase. Any shares acquired by ZPP pursuant to
the Bid will be cancelled.
    At June 30, 2008, the Company had cash and short-term deposits, including
the short-term deposit with Zongshen Industrial Group, totalling
$38.9 million, compared to $36.5 million at December 31, 2007 and no long-term
debt. The Company has approximately $10 million committed to capital projects,
comprising the construction of ZPP's Chongqing production facility and battery
exchange club trial project. The Company is well capitalized to fund the
expansion of its electric motorcycle and small gas motorcycle business and
take advantage of strategic investment opportunities, which may include
acquisitions, joint ventures and the development of new products.
    "Given the growth opportunities that are available to us and the growing
demand for ZPP's product line in China and in export markets, we are confident
that the Company's share price is undervalued and not reflecting the true
value of the business," noted Zongshen Zuo, Chairman and Chief Executive
Officer of Zongshen PEM Power Systems Inc. "We have a strong balance sheet
which will be deployed cautiously to explore growth opportunities to increase
shareholder value."

    About Zongshen PEM Power Systems Inc.

    Zongshen PEM Power Systems Inc. is a public company trading under the
symbol ZPP on the Toronto Stock Exchange. The Company is engaged in the
commercialization of alternative power systems including batteries, fuel cells
and solar power, for a variety of consumer and industrial applications. The
Company manufactures low-cost, high quality, environmentally friendly small
gas motorbikes, electric motorcycles, electric bicycles and other e-vehicles
in China for the Chinese domestic and international markets. Zongshen PEM
Power System's largest shareholder is Zongshen Industrial Group, one of
China's largest manufacturers and distributors of motorcycles, engines, and
power equipment.

    About Zongshen Industrial Group

    Zongshen Industrial Group was founded in 1992, and now consists of 30
totally or majority owned subsidiaries including Chongqing Zongshen Power
Machinery Co., which is listed on the Shenzhen Stock Exchange. The Company
employs in excess of 13,000 employees with assets in excess of RMB 8.4 billion
yuan. Zongshen Industrial Group implements the development strategy of related
diversification within thermodynamic machinery industry. Its engine products
mainly include motorcycle engines, mini-car engines, speedboat engines, and
general-purpose machinery. Its end products mainly include motorcycles,
speedboats and other power equipment. Zongshen Industrial Group now has an
annual production capacity of 2,000,000 motorcycles, 50,000 mini vans,
3,000,000 motorcycle engines, 5,000,000 general-purpose engines, and 100,000
car engines. Zongshen Industrial Group has established a leading brand for
motorcycles in China attracting some of the world's largest motorcycle
manufacturers as joint venture partners.

    Forward Looking Information

    Certain statements that are not historical facts made in this press
release may be forward looking statements subject to risks and uncertainties.
Statements containing words such as "could", "expect", "may", "anticipate",
"believe", "intend", "estimate", "plan" and other similar expressions are
forward-looking statements that represent management's beliefs and are based
on certain factors and assumptions set forth in this press release including
foreign exchange rates, expected growth, manufacturing output and capacity,
sales expectations, market potential and expected business opportunities.
While the Company considers these factors and assumptions to be reasonable
based on information currently available, they may prove to be incorrect.
Forward-looking statements may relate to matters such as expected financial
performance, business prospects, technological developments, and development
activities and like matters. These statements involve risks and uncertainties,
including but not limited to the risk factors described in reporting documents
filed by the Company. Actual results could differ materially from those
projected as a result of these risks and should not be relied upon as a
prediction of future events. Except as required by applicable securities laws,
the Company undertakes 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 unanticipated events.

For further information:

For further information: Ali Mahdavi, Zongshen PEM Power Systems Inc.,
Vice President, Corporate Finance & Investor Relations, (416) 962-3300,
1-877-775-8734, amahdavi@zongshenpem.com

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