www.cfsg1.com FOR IMMEDIATE RELEASE CONTACT: Daniel Stepanek, Executive VP Consulting for Strategic Growth I Tel: 1-212-896-1202 dstepanek@cfsg1.com www.cfsg1.com STANLEY WUNDERLICH AND EXPERT PANEL TARGET MAJOR ISSUES FOR TAKING CHINESE COMPANIES PUBLIC IN THE U.S.
CEO of CFSG1 Leads Discussion of “China’s Obsession with Reverse Mergers” at “Alternative Exits Conference” at The Harmonie Club in New York City NEW YORK, December 15, 2006 – Six major issues facing Chinese companies seeking public financing in the U.S. were highlighted and discussed in depth by financial and banking experts led by Stanley Wunderlich, CEO, Consulting for Strategic Growth 1 (CFSG1), during the “Alternative Exits Conference” recently held at New York’s Harmonie Club. Mr. Wunderlich led a panel that included James Hahn, founding Managing Partner, Asia Alpha Private Equity (http://www.asiaalpha.com/new%20contact%20page.htm), LP; Marat Rosenberg, Managing Director, Halter Financial Group, Inc. (www.halterfinancial.com); and Mark C. Jensen, Principal, Barron Partners, LP (www.barronpartners.com). The following key issues emerged as critical to successful investor relations for China-based companies: 1. Bridging the communications gap. The language gap remains an important barrier to smooth communications between Chinese company management and U.S. investors. Unclear company communications can create confusion and undermine credibility for both sides. Translators familiar with the development strategies of the China companies and with American investor concerns, market regulations and business terminology are needed to provide effective communications and negotiate reasonable expectations. Mr. Wunderlich cited successful experiences with three colleagues over the years: Consulting for Strategic Growth I, Ltd., 800 Second Avenue, 5th Floor, New York, NY, 10017 Phone: 800-625-2236 • Fax: 212-337-8089 • Email: info@cfsg1.com
▪ Roy Teng who represents Home System Group, China’s largest manufacturer of luxury stainless steel gas grills and an international distributor of home appliances; ▪ Felix Wong, an attorney and skilled translator at Conceptual Management, which represents bridge and mezzanine financings for numerous China-based companies; and ▪ Yale Yu, a partner in Vantage Consulting, a business consultancy based in Shanghai, who has introduced CFSG1 to several emerging Chinese companies such as China Biopharmaceutical Holdings (CHBP.OB) based in Beijing; The Yi Wan Group (YIWA.PK), a hotel and hospitality company in Henan Province; and Tiens Biotech Group (USA) (TBV:AMEX), whose parent company is Tianjin Tianshi Group based in Beijing. 2. Leveraging a move from the OTCBB to the American Stock Exchange. Growing Chinabased companies may do well to pursue listing on the AMEX for several reasons. Often the move provides the incentive for the Chinese company to consolidate and stabilize their stock through a reverse split. The reverse split raises the nominal value of the stock, making it ready not only for listing on a larger exchange than the Bulletin Board but also opening access to retail broker/dealers and wider trading options that can drive the stock value to a new level. Mr. Wunderlich cited Tiens Biotech as a successful case study in such a move, and observed that he is advising another client, HQ Sustainable Maritime (HQSM.OB), to follow a similar path. 3. Obtaining a Standard & Poor’s listing. Many China-based companies are not aware that by filing an S&P tear sheet listing, they can become “blue-skyed” allowing them to be traded by broker/dealers in 39 states and thus providing potential outreach to a substantially larger base of investors. 4. Accessing top-tier professionals to help raise capital. To raise capital, China-based firms need top-tier accounting firms and law firms, as well “best practice” IR/PR firms to ensure knowledge of international complexities, full compliance with U.S. regulations (including the latest details of Fair Disclosure, Sarbanes-Oxley, etc.) and greater credibility for the client in the eyes of U.S. investors. 5. Assessing governmental and political risk of investing in China-based companies. Investing in China-based companies is becoming easier for American investors, as experience on both sides ensures greater knowledge of the different regulations of each nation. China’s regulations regarding foreign investment have become more standardized and China companies are becoming more accustomed to both U.S. government regulations and the wide-ranging options of the U.S. free markets.
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6. Growing number of China companies seek reverse mergers. As a result of greater experience and standardized regulations, more China companies are seeking listing on the OTC Bulletin Board rather than on the Hong Kong exchange, which can be more time-consuming and expensive. Reverse mergers are usually the method of choice, as they are relatively quick and cost-effective when done properly, and can be followed promptly by capital-raising activities.
Mr. Wunderlich said, “This is an important period in the growth of China-U.S. business relations. I believe the panel members were able to provide thoughtful advice on the current status by identifying and evaluating key on-going issues. Several of us have had substantial experience with an ever-widening range of China-based companies. High-level discussions like this one provide better understanding of the driving forces in this exciting market and establish a more favorable business environment for growth.
About Consulting for Strategic Growth 1, Ltd.
CFSG1 has decades of hands-on corporate development experience and broad personal outreach in the private equity markets and Wall Street broker/dealer communities. It is a leader in reverse mergers, investor and public relations and corporate development for small-cap companies and private enterprises, both domestic and international. In addition to U.S. clients, the Company’s portfolio includes a growing number of businesses originating in countries such as China, South Africa and Canada. With offices in New York City and Boca Raton, Fla., and strong relations with major national media outlets, CFSG1 provides newly public businesses with a unique full-service communications platform. CFSG1’s strategic partners include Rodman & Renshaw, Inc., a full-range investment bank nurturing emerging growth companies since 1951; Brookshire Securities, a leading Florida investment firm focused on the needs of small to medium sized companies; ChineseWorldNet.com, Inc. (CWN), a worldwide financial platform catering to small- and mid-size Chinese companies and the Chinese investor community; and Vantage Consulting, based in Shanghai with offices in Hong Kong, Singapore, Taipei, New York and California. ###
Consulting For Strategic Growth I, Ltd. (“CFSG1”) provides consulting, business advisory, investor relations, public relations and corporate development services to public and private companies. In connection with these services, CFSG1 prepares press releases, corporate profiles, and other publications on behalf of and regarding its clients. Certain statements contained in this press release that are not purely historical are forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Words such as "believes", "expects", "anticipates", "plans", "estimates", "could" and similar expressions that convey uncertainty of future events or outcomes identify forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of CFSG1 or its clients to differ materially from those expressed or implied by these forward-looking statements.
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