December 02, 2008

China Gengsheng to acquire Xinyu Abrasives Co Ltd

China Gengsheng Minerals Inc announced that it has signed a definitive agreement to acquire 100% of Qiandongnanzhou Xinyu Abrasives Co Ltd located in Guizhou province in China for USD 857,000 in cash.

According to the release, Xinyu is a medium sized supplier of raw materials to refractory manufacturers and specializes in brown fused alumina, derived from fusing bauxite to obtain a higher concentration of alumina. The fused alumina is used to make high strength abrasives and refractory products. The purchase of Xinyu is expected to secure upstream self-sufficiency in fused alumina for Gengsheng's refractory and fine precision abrasive products.

Mr Shunqing Zhang Chairman, CEO and President of Gengsheng said ''Today's acquisition is expected to strengthen our access to and ownership of key raw material supplies. 'In addition, we expect that Xinyu will generate revenues from continued sales of raw materials to other refractory manufacturers.''