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Wuhan General Group (China), Inc. Enters Into Asset Purchase Agreement With Wuhan Gongchuang Real Estate Co., Ltd.

Posted on: Thursday, 5 February 2009, 09:30 CST

WUHAN, China, Feb. 5 /PRNewswire-Asia-FirstCall/ -- Wuhan General Group (China), Inc. (Nasdaq: WUHN) ("Wuhan General" or the "Company"), a leading manufacturer of industrial blowers and turbines in China, today announced that the Company entered into an asset purchase agreement with Wuhan Gongchuang Real Estate ("Gongchuang") in December 2008.

According to the agreement, the Company will pay Gongchuang approximately $24.7 million for the purchase of certain assets, including buildings, equipment and land use rights. To date, approximately $17.3 million of this amount has been paid in cash using proceeds from the exercise of warrants and ongoing operations. The remaining balance will be paid in installments over a one-year period. The total amount of consideration to be paid was determined by a valuation performed by an independent party.

Covering an area of 73,630 square meters, or roughly 18 acres, the land and buildings are located in Hanyang District in the city of Wuhan, 20 km from Wuhan General's headquarters. The site is well positioned for access to major transportation routes, facilitating future logistical needs.

"We are pleased to have completed this strategic acquisition," commented Mr. Xu Jie, CEO of Wuhan General. "As we are completing the installation of customized equipment for our new turbine manufacturing facility, we are excited to lay the groundwork for future phases of expansion. We believe this acquisition will facilitate our long term growth," added Mr. Xu.

About Wuhan General Group (China), Inc.

Through its subsidiaries Wuhan Blower Co., Ltd. and Wuhan Generating Equipment Co., Ltd., Wuhan General is a leading manufacturer of industrial blowers and turbines in China. Wuhan Blower is a China-based manufacturer of industrial blowers that are principal components of steam-driven electrical power generation plants. Wuhan Generating Equipment is a China-based manufacturer of industrial steam and water turbines used for electricity generation in coal, oil, nuclear, and hydroelectric power plants. The Company's primary customers are in the iron and steel, power generation and petrochemical industries. Led by a strong management team, Wuhan General is well recognized for its technological sophistication and quality construction of blowers and turbines.

Safe Harbor Statement

Certain statements in this press release, including those concerning the benefits of the acquisition and the achievement of our growth strategy, may be forward-looking in nature or "forward-looking statements," as defined by the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks and uncertainties, including all business uncertainties relating to vulnerability of our business to general economic downturn, operating in the People's Republic of China (PRC) generally and the potential for changes in the laws of the PRC that affect our operations, our failure to meet or timely meet contractual performance standards and schedules and other factors that may cause actual results to be materially different from those described in such forward-looking statements. Certain of these risks and uncertainties are or will be described in greater detail in our filings with the Securities and Exchange Commission. These forward-looking statements are based on Wuhan General's current expectations and beliefs concerning future developments and their potential effects on the Company. There can be no assurance that future developments affecting Wuhan General will be those anticipated by the Company. Wuhan General undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

SOURCE Wuhan General Group (China), Inc.

Source: PR Newswire

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