ADAM.L Regulatory News (ADAM)

Adamas Finance Asia Limited

BRJ China Credit Fund Fully Exited on Project Changlelu

BRJ China Credit Fund Limited ("BRJ" or the "Fund"), an investment fund into which Adamas Finance Asia Limited ("AFA" or the "Company" - AIM ticker: ADAM) invested US$500,000 earlier this month, has achieved a gross IRR of 31.83% from a newly-exited project, Project Changlelu.

BRJ was launched in August 2013 by Hong Kong-based Adamas Asset Management (HK) Limited ("Adamas"), which since February 2014 has been has been acting as AFA's investment manager.

Project Changlelu has now repaid in full both the principal and interest on a RMB15 million (approx. US$2.4 million) loan structured by Adamas, which was an early investment by the BRJ Fund. The loan, arranged as bridging finance for a successful leisure business in China, was deployed on 23 January 2014 and fully repaid on 23 April 2014. Because of the structure of the Fund, the exit has increased its Net Asset Value, and the cash generated becomes available for future investment.

The BRJ investment in Project Changlelu was in line the strategic approach followed by the Adamas investment team, which places strong emphasis on rigorous due diligence, tight management involvement and an insistence on robust collateral. The collateral backing Project Changlelu was a historic building located at Changlelu, Shanghai, with an overall loan-to-value ratio of approximately 57%. The collateral was further underpinned by corporate guarantors involved with the borrower.

AFA Chairman John Croft said: "We are delighted by this news, not least because it follows our announcement at the start of this month that the Company received a distribution of US$75,300 from a separate, September 2013, investment of US$1 million into another fund managed by Adamas - the Greater China Credit Fund. The BRJ exit from the Project Changlelu provides a further clear example of how we are already benefitting from the investment advice provided by the Adamas team in Asia."

BRJ was launched in August 2013 to provide capital for operationally-sound Chinese SMEs in need of short-term bridging finance not easily available within the PRC, where more than 90% of such companies have difficulty in obtaining bank funding. The Fund plans to invest US$50 million, seeking target returns of 24%-30% per annum with the objective of an annual dividend of 8%, payable semi-annually. It aims predominantly to use property as collateral on short-term structured loans.

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