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.
SOURCE American Oriental Bioengineering, Inc.
