Gulf Resources (GURE) Trade Higher Following Response to Privatization Allegations
Tweet
Share
E-mail
Gulf Resources, Inc. (Nasdaq: GURE) is trading substanitaly higher today after issuing this press release regarding recent market speculation as to the Company's plans with respect to a potential third-party investment in the Company, or a privatization transaction.
There have been recent market rumors about the implications for the Company of an investment letter of intent ("LOI") between Shandong Ocean Bright Stone Industry Fund Management Co., Ltd., a PRC-based investment fund ("Ocean Bright"), and Shandong Haoyuan Industrial Group Co., Ltd. ("SHIG"). SHIG is an entity controlled by our Chairman and is a record owner of approximately 11.9% of our common stock. SHIG, together with the Chairman and his family, owns in the aggregate approximately 38.5% of our common stock.
We have been informed by Chairman Yang that, on February 20, 2012, SHIG did execute an LOI with Ocean Bright regarding a potential investment program in China's bromine exploitation industry, with the objective of consolidating those investments under SHIG and ultimately seeking a stock exchange listing for SHIG in China. We have been told that the LOI is highly preliminary and conditional, being subject to, among other things, due diligence and the commitment of definitive funding for potential PRC bromine investments. The Company is not a party to the LOI, but the Chairman has informed us that SHIG and Ocean Bright are considering the Company as a potential principal component to their strategy of consolidating the bromine industry in China, and, accordingly, as a potential candidate for a privatization in order to satisfy the listing requirements for SHIG in China.
As of this time, the Company has not received from either SHIG or Ocean Bright any formal or informal offer as to any type of investment or acquisition transaction, or any other inquiry seeking negotiations or due diligence. The Company's Board of Directors will take appropriate steps in the best interests of the Company's shareholders to evaluate fully and independently any such offer or inquiry that may be received from SHIG or Ocean Bright in the future.
"We will continue to focus on our daily operations, exploring strategic alternatives where appropriate, and creating value for our shareholders," said Xiaobin Liu, Chief Executive Officer of Gulf Resources. "If negotiations between the Company and SHIG and Ocean Bright begin and progress to a definitive point meriting shareholder disclosure or consideration, then we will of course update the market at that time. We however cannot give any assurance as to the timing of any of these negotiations, and, if they do begin, whether they will progress to any definitive agreement."
The Company follows a policy of not commenting on market rumors and takeover speculation, but has made an exception in this limited situation. We do not expect to have further comment on this matter at this time.
There have been recent market rumors about the implications for the Company of an investment letter of intent ("LOI") between Shandong Ocean Bright Stone Industry Fund Management Co., Ltd., a PRC-based investment fund ("Ocean Bright"), and Shandong Haoyuan Industrial Group Co., Ltd. ("SHIG"). SHIG is an entity controlled by our Chairman and is a record owner of approximately 11.9% of our common stock. SHIG, together with the Chairman and his family, owns in the aggregate approximately 38.5% of our common stock.
We have been informed by Chairman Yang that, on February 20, 2012, SHIG did execute an LOI with Ocean Bright regarding a potential investment program in China's bromine exploitation industry, with the objective of consolidating those investments under SHIG and ultimately seeking a stock exchange listing for SHIG in China. We have been told that the LOI is highly preliminary and conditional, being subject to, among other things, due diligence and the commitment of definitive funding for potential PRC bromine investments. The Company is not a party to the LOI, but the Chairman has informed us that SHIG and Ocean Bright are considering the Company as a potential principal component to their strategy of consolidating the bromine industry in China, and, accordingly, as a potential candidate for a privatization in order to satisfy the listing requirements for SHIG in China.
As of this time, the Company has not received from either SHIG or Ocean Bright any formal or informal offer as to any type of investment or acquisition transaction, or any other inquiry seeking negotiations or due diligence. The Company's Board of Directors will take appropriate steps in the best interests of the Company's shareholders to evaluate fully and independently any such offer or inquiry that may be received from SHIG or Ocean Bright in the future.
"We will continue to focus on our daily operations, exploring strategic alternatives where appropriate, and creating value for our shareholders," said Xiaobin Liu, Chief Executive Officer of Gulf Resources. "If negotiations between the Company and SHIG and Ocean Bright begin and progress to a definitive point meriting shareholder disclosure or consideration, then we will of course update the market at that time. We however cannot give any assurance as to the timing of any of these negotiations, and, if they do begin, whether they will progress to any definitive agreement."
The Company follows a policy of not commenting on market rumors and takeover speculation, but has made an exception in this limited situation. We do not expect to have further comment on this matter at this time.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Holcim said to acquire part of James Hardie's EU business
- S&P 500 may pull back before midterms, but Citi says buy the dip
- Nscale targets up to $3B in US IPO as soon as September - Bloomberg
Create E-mail Alert Related Categories
Mergers and Acquisitions, Momentum Movers, Trader TalkSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
