CARLSTADT, N.J., June 13, 2012 /PRNewswire/ -- Jinpan International Ltd. (Nasdaq: JST) (the "Company"), a leading designer, manufacturer, and distributor of cast resin transformers, today announced that it has entered into agreement with the Bank of Communications for two credit lines – a long term credit line for fixed asset investment and a short term credit line for working capital – totaling RMB 350 million (approximately US$ 55 million). The fixed asset credit line is in the amount of RMB 210 million (approximately US$ 33 million) and carries an interest rate of People's Bank of China Bench Mark Rate x 1.05 per annum. Loans made under this credit line must be applied to fixed asset investment at the Company's Guilin facility. The credit line has a term of seven years. Repayment of loan principal is scheduled over a seven year period, from 2013 to 2019.
The working capital credit line is in the amount of RMB 140 million (approximately US$ 22 million) and carries an interest rate of People's Bank of China Bench Mark Rate x 1.05 per annum. Loans made under this credit line must be applied to the working capital of the Company's Guilin facility. The credit line has a term of two years. The loan principal must be repaid in full annually.
Mr. Zhiyuan Li, Chief Executive Officer of Jinpan, commented, "We are pleased to secure these two lines of credit. Obtaining funding from an established lender like Bank of Communications further validates Jinpan's attractive long term growth outlook and strong operating model. These two credit lines will be used to develop our new manufacturing facility in Guilin. They will provide significant support to our business expansion in a non-dilutive manner to our shareholders. With the financial flexibility of our credit lines and a healthy backlog, we remain comfortable with our long-term growth strategies."
Safe Harbor Provision
This press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectations and observations and involve known and unknown risks, and uncertainties or other factors not under the Company's control, which may cause actual results, performance or achievements of the company to be materially different from the results, performance or other expectations implied by these forward-looking statements. These factors are listed from time-to-time in our filings with the Securities and Exchange Commission, including, without limitation, our Annual Report on Form 20-F for the period ended December 31, 2011 and our subsequent reports on Form 6-K.
Except as required by law, we are not under any obligation, and expressly disclaim any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise.
SOURCE Jinpan International Ltd