| Contact: | Zelda Yung, Carol Wong | October 4, 2001 |
| Tel: | 2801-7761, 2801-7729 | Total Pages: 2 |
Placing of additional existing shares
to meet strong market demand
Global Bio-chem Technology Group Company Limited ("Global Bio-chem" or the "Company" and together with its subsidiaries, the "Group", stock code: 809), announced today that GC Capital (Asia) Limited, the placing agent ("Placing Agent") under the placing agreement ("Placing Agreement") dated September 26, 2001, exercised in full the option granted to them ("Option") for the placing of an additional 76 million existing shares of Global Bio-chem ("Existing Shares"), in response to intense demand from investors for the Company's shares.
Pursuant to the Placing Agreement, the Placing Agent was to place 180 million Existing Shares from LXM Limited, holder of a total of 288 million Existing Shares, to individual, professional and institutional investors at a price of HK$1.86 per share, together with the grant of the Option for the placing of a maximum of an additional 76 million Existing Shares.
Pursuant to the exercise in full of the Option, a total of 76 million Existing Shares, representing approximately 5.9 per cent of the existing issued share capital of the Company, were sold and placed to certain institutional investors at a price of HK$1.86 per share.
LXM Limited will subscribe for the same number of new shares in Global Bio-chem to be issued by the company, thus raising an additional net proceeds of about HK$137 million.
Together with net proceeds raised through the original 180 million subscription shares, Global Bio-chem has successfully raised a total of about HK$457 million through the placing of existing shares and topping up subscription for new shares. Global Bio-chem intends to use such net proceeds for future investment projects including, but not limited to, the manufacture and sale of products from the fermentation of corn and / or starch, and for general working capital of the Group.
"We are pleased with the well-received response from investors, considering the adverse market sentiment during the past two weeks. In fact, due to the strong market demand for and confidence in our Company's shares, the option granted to our placing agent for the placing of an additional 76 million shares was exercised in full. The successful placing of our shares under the two tranches has provided for the Company necessary capital to fuel its continuous expansion," said Mr. Liu Xiaoming, Chairman of Global Bio-chem.
Deloitte & Touche Corporate Finance Limited and GC Capital (Asia) Limited are the joint financial advisers to Global Bio-chem for the captioned placing and subscription.
Global Bio-chem is primarily engaged in the research and development, manufacture and sale of corn refined and corn based biochemical products in China and other Asian countries. Headquartered in Hong Kong and with its main production facilities based in Changchun, Jilin province in China, the Group is one of the largest corn based biochemical product manufacturers in China.
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| Issued by | : Global Bio-chem Technology Group Company Limited |
| Through | : CorporateLink Limited |
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