JUNAN COUNTY, China, June 14 /PRNewswire-Asia-FirstCall/ -- American Lorain Corporation (NYSE Amex: ALN) ("American Lorain" or the "Company"), an international processed snack foods and convenience foods manufacturer based in Shandong Province, China, today announced that it secured a $15 million bank loan from a German development bank, Deutsche Investitions-und Entwicklungsgesellschaft MBH ("DEG").
"To support our growth in 2010 and beyond, we took a two-prong approach to accessing capital," began Chen Si, Chairman and CEO of American Lorain. "We have deemed that our S3 shelf registration is an appropriate tool for us to use American Lorain shares to access growth capital in the coming years, however considering the current conditions of equity markets, it is not prudent to proceed with a equity raise at this time. Debt is the optimal source of capital at this time and in particular during downturns in equity markets. We are pleased to secure this long-term $15 million loan with a well-known and respected international bank. Our primary product, chestnuts, is enjoying a growth cycle both domestically and in international markets where demand across this product line, including our new frozen chestnuts promotion, has increased significantly."
American Lorain's chestnut processing facility, Junan Hongrun, was the direct recipient of the loan which was collateralized by the facility's assets. The loan is six-year term with an interest rate of LIBOR plus 3.75%.
"We are very glad to extend the $15 million long term loan to Junan Hongrun," said Sheng Qu, investment manager of DEG who is based in Beijing China. "Junan Hongrun is a solid company and has contributed a lot to local social and economic development in Junan along with its fast growth in past years. We spent over a year to carefully evaluate this project and hired experts to review Junan Hongrun's social and environmental impact to the local society before we finally signed the loan agreement. We are happy with the results we have seen and trust that this $15 million loan will help further growth and development in both Junan Hongrun and the local economy."
DEG, member of KfW Bankengruppe (KfW banking group), finances investments of private companies in developing and transition countries. As one of Europe's largest development finance institutions, it promotes private business structures to contribute to sustainable economic growth and improved living conditions. Founded 1962, based on an idea of the first German Minister for Development Aid, Walter Scheel, and the then state premier of Schleswig-Holstein, Kai-Uwe von Hassel, DEG's intention is to promote economic development and raise people's living standards in partner countries.
DEG fulfils its role as a development finance institution for the private sector in two ways: it is the reliable finance partner for enterprises that undertake investments. At the same time DEG focuses particular attention on these investments producing positive effects in the developing countries. DEG thus contributes to the Millennium Development Goals, which are a joint commitment of industrial and developing countries to tackle poverty in a sustainable manner. For further information about DEG, please visit the Company's website at www.deginvest.de
About American Lorain Corporation
American Lorain Corporation is a Nevada corporation that develops, manufactures and sells various food products. The Company's products include chestnut products, convenience food products and frozen food products. The Company currently sells over 230 products to 26 provinces and administrative regions in China as well as to 42 foreign countries. The Company operates through its four direct and indirect subsidiaries and one leased factory located in China. For further information about American Lorain Corporation, please visit the Company's website at www.americanlorain.com
Statements contained herein that relate to the Company's future performance, including statements with respect to forecasted revenues, margins, cash generation and capital expenditures are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve a number of risks, uncertainties and contingencies, many of which are beyond our control, which may cause actual results, performance or achievements to differ materially from those anticipated. Such statements are based on current expectations only, and are subject to certain risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. Among the factors that could cause actual results to materially differ include: general business and economic conditions, particularly the current downturn in the worldwide economy; our ability to obtain adequate supplies of raw materials; our ability to manage our expansion strategy; changes in foreign currency exchange rates; government regulation; difficulties in new product development; changing consumer tastes in disparate markets worldwide and our ability to address those changes; our ability to attract and retain highly qualified personnel; and other factors affecting our operations that are set forth in our Annual Report on Form 10-K for the year ended December 31, 2009 filed with the Securities and Exchange Commission. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For more information, please contact:
At the company:
American Lorain Corporation
Alan Jin, CFO
John Mattio, SVP
HC International, New York
SOURCE American Lorain Corporation