Investee Company update

26 Jul 2007 08:49

London Asia Chinese Private Equity26 July 2007 26 July 2007 London Asia Chinese Private Equity Fund Limited("LACPEF" or "the Fund") Investee Company Raises US$20 million LACPEF, the AIM listed (LCP.L) China focused investment fund, is pleased toannounce that its investee company China New Energy Limited has raised up toUS$20 million of new funds via the issue of convertible bonds. China New Energy Limited ("CNE"), listed on the UK's PLUS Stock Market, is aspecialist biofuels business. The Fund invested £2.2 million for a 25% stake inCNE in September 2006. The new investment values the Company at approximatelyUS$100 million (£50 million). The investment is in two tranches, with an initial drawdown of US$12 million ("the First Tranche"), and a second tranche of US$8 million being conditional. The convertible bonds have a maturity of three years. The First Tranche is at azero interest rate, with the second tranche at an interest rate of up to 15%,dependent on various factors. The conversion price of the bonds is based on amultiple of the estimated profits for the year ending 31 December 2007. The investor in the bonds is an alternative investment management fund based inthe US with approximately US$15 billion under management. Mr Tang, China New Energy Chief Executive, said: "The new capital will be usedto expand our international operations, where we are seeing demand from a numberof countries, and to make acquisitions of businesses using our technology andthe biofuel to produce specialty chemicals." Simon Littlewood, Director of the Fund, said: "CNE has shown significantprogress since we invested, expanding its operations internationally as well assecuring significant new projects in its home market. The proposed expansioninto ownership of facilities will provide stable recurring income to complementits core turnkey solution provider business." For further information please contact: John West/Andrew Dunn Cecilia Wong Hugh FieldTavistock Communications London Asia Ltd Collins Stewart Europe LimitedTel: 020 7920 3150 Tel: +852 22518373 Tel: 020 7523 8350 cecilia.wong@londonasia.com About China New Energy Limited CNE has established itself as the leading brand in China for turnkey ethanolproduction equipment. The Company has a successful track record, with itstechnology used in over 35 projects to date. CNE is supported by strong driverswith the demand for biofuel, seen as an alternative to oil, growing rapidly andsupported by changes in legislation both in China and elsewhere as countriesseek to reduce their dependence on imported oil. For additional information, visit the Company's web sitewww.chinanewenergygroup.com This information is provided by RNS The company news service from the London Stock Exchange