Harbin, China, 17 June 2010 -- (GLOBE NEWSWIRE) -- China Forestry Inc. (OTCBB:CHFY - News), a timber investment group in the People's Republic of China, announced today that it has acquired all the equity interest of Hanzhong Hengtai Bio-Tech Limited (Hengtai), a China incorporation, by entering into a share exchange agreement dated 10 June 2010, with Financial International (Hong Kong) Holdings Company Limited, (FIHK); the shareholders of FIHK; as well as Hengtai.
Hengtai is a company organized under the laws of China and existed as a variable interest entity of FIHK, a company incorporated in Hong Kong. Hengtai is engaged in the business of Chinese yew, Aesculus, dove tree, and Dendrobium plantations. The breed of Chinese yew and Dendrobium grown by the company are endorsed by Ministry of Science & Technology of China under the China Spark Program. Paclitaxel extracted from yew is used as an anticancer medicine.
Under the terms of the share exchange agreement, CHFY will acquire 100% of all of the issued and outstanding share capital of FIHK from its shareholders in an exchange for 100,000,000 shares of newly issued common stock of the CHFY and a convertible note in the principal amount of $1.0 million, which note is convertible into 68,000,000 shares of common stock of CHFY. Pursuant to the agreement, CHFY would acquire and operate FIHK and Hengtai as wholly-owned subsidiaries.
Yuan Tian, CEO of CHFY said, "This is an important step in our corporate developing, making Hengtai an integral part of our business strategy. Hengtai is a strong company with a promising future, and we believe this acquisition will enable our shareholders to realize significant value."
China Forestry Inc. (OTCBB:CHFY - News) is a timber investment group formed in the People's Republic of China to conform to State laws that prohibit non-PRC ownership of forest lands. The company's strategy is to capitalize on the Chinese government's decision to promote sustainable forest management through land tenure reforms that include the transferability of forest user right certificates to PRC entities. The company's current holdings include ownership of four user right certificates representing 1561 hectares of state forest assets in China's northeastern Heilongjiang Province, home to China's most valuable timber and one of the most distinctive temperate forests in the world due to its rare biodiversity. For more information, visit http://www.chinaforestryinc.com.