BVI Company News

On January 16, 2007 Dragon International Group has announced entering into a stock purchase agreement with BVI-registered Wellton International Fiber Corp. According to this agreement, Dragon is purchasing 51% of Wellton International Fiber in an all stock transaction.

Wellton International Fiber, which is domiciled in the British Virgin Islands and based in Hong Kong, is an importer of market pulp in China. In 2006, Wellton generated approximately US$18.5 million of revenues, with over US$1 million in net income. Based on the audited net tangible assets of Wellton, Dragon will issue restricted shares of its common stock. The shares will be issued upon completion of auditing at the closing of the deal, which is expected by March 31, 2007. Dragon expects to issue shares not to exceed a value of US 1,500,000.

The chairman and CEO of Dragon International Group, David Wu, has commented, “We feel confident in our ability to merge the Wellton operations into our own and achieve synergies that will enhance both our operations.“

China Northwest Biotech Inc. has announced that it has terminated the acquisition of Xian Chong Yang Sci-Tech Stock Co. (Chong Yang). The decision was taken due to the inability of Chong Yang to transfer assets to its parent company, BVI-domiciled Top Sonic Inc., and with the fact tha China Northwest has not provided financial reports in time.

Michael Dooley, the CEO of China Northwest, has explained the board’s resolution to terminate merger with Chong Yang, “We have exhausted all options to resolve the outstanding issues and have given The Chong Yang Group more than ample time to deliver what was required by the merger agreement. Since Chong Yang didn’t adhere to what was agreed originally in the merger agreement, the company has no choice but to terminate the merger.”

The management of China Northwest considers that at this stage termination of merger agreement with Chong Yang was necessary, to enable other potential business opportunities to move forward. At the moment, the company is in talks for mergers and acquisitions with several potential candidates.

The largest London-listed online gaming company PartyGaming, based in Gibraltar, has confirmed in the end of December the purchase of gambling web sites from Empire Online Ltd. The BVI-based Empire Online, the owner of gaming brands such as Noble Poker, stated separately that it will receive about $38 million from the sale. The company spokesman has said that the discussions on sale of company’s gaming business and assets are to be continued. Empire has received an offer about a takeover from the poker operator in November 2005.

Before the companies became legal adversaries in a case that was later settled, PartyGaming was Empire’s main customer, incorporated in the British Virgin Islands. PartyGaming is the world’s biggest Internet poker company, which will fund the acquisitions by issuing 115.2 million new shares. It was stated by the company that the purchases probably will increase earnings next year.

Web gambling operators including PartyGaming have stopped taking bets from the US, after the country’s Senate passed the Internet Gambling Enforcement Act at the end of September, that made it criminal to process credit-card payments for the industry, and actually caused an online gambling crisis. This law actually separated companies, including PartyGaming and Empire, from their main revenue sources. Now PartyGaming, as well as other Internet gambling operators, is trying to compensate lost sales following the enactment of this legislation. US gamblers accounted for about 85% of sales in 2005 at PartyGaming and about 65% of Empire’s sales, when the company stopped accepting wagers from American gamblers.

The Empire purchase, which must be approved by the company’s shareholders, will add three casino Web sites as well as Noble Poker. PartyGaming expects the acquisition to contribute earnings before interest, taxes, depreciation and amortization of at least $6 million next year.

After selling its gambling business, the BVI company is planning to use its cash reserves to become an investment company.

Cemex, the world’s third-largest cement maker plans to sell up to $1.5 billion in fixed-to-floating rate perpetual callable securities, according to Fitch Ratings. As it was stated on Monday, this debt will be sold in two tranches, and issued by special purpose vehicles incorporated with limited liability in the British Virgin Islands. Their assets in the amount of $1.5 billion consist of perpetual dual currency notes issued by New Sunward Holding Financial Ventures (NSHFV), which will be purchased by the issuer or issuers with proceeds from the debentures. The debentures will be secured by a first priority security interest in the dual currency notes.

According to Fitch, the perpetuals will have no fixed maturity date and interest due on any payment date may be deferred by the issuer indefinitely. If the debt is not called, the perpetual notes are expected to have coupons of 3 percentage points over the three-month London interbank offered rate, and will be sold in the next week, according to a source familiar with the deal.

NSHFV is an indirect wholly owned special purpose subsidiary of Cemex, S.A.B. de C.V. (Cemex). NSHFV’s obligations under the dual currency notes will be unconditionally guaranteed on a joint and several basis by Cemex and its subsidiaries Cemex Mexico S.A. de C.V. (Cemex Mexico) and New Sunward Holding B.V. (New Sunward) (the guarantors).

Cemex is the third-largest cement producer in the world based on production capacity of approximately 97 million metric tons in more than 50 countries. During 2005, revenues and EBITDA reached US$15.3 billion and US$3.6 billion, respectively, and the largest contributors to cash flow were as follows: Mexico, 33%; the United States, 27%; and Spain, 11%. Approximately 85% of consolidated EBITDA was earned from investment-grade countries.

A month ago in one of October blogpost we mentioned the fact of selling by British Virgin Islands incorporated BrazMin Corp. all of its interests in the Tocantinzinho gold project in Brazil. As it was announced on September 13, 2006, BrazMin’s interests in the Project area will be acquired by Brazauro Resources Corporation. In the beginning of December Brazauro Resources Corporation and BrazMin Corporation were advised that the mining license acquired by Brazauro has been confirmed as the paramount title over Brazauro’s Tocantinzinho Project. The license assures good title and continuity to the Project area. Brazauro holds a total of 43,840 hectares of mineral interests at Tocantinzinho.

Upon publication of the confirmation of title in Brazil’s official Government Gazette Brazauro will issue 13.15 million common shares to BVI BrazMin Corporation. The acquisition extends Brazauro’s landholdings at Tocantinzinho to the east and southeast, into zones that Brazauro believes hold potential to expand the overall project’s gold-bearing mineralization.

Anthony H. Ransom, President and CEO of BrazMin, has commented: “Resolution of the complex title issues at Tocantinzinho is a great step forward and will ensure the orderly exploration and development of the area. Through our investment in Brazauro, we will continue to have exposure to this emerging project, while focusing activities on our property portfolio, both within the Tapajos district and elsewhere in Brazil.”

Mark E. Jones, Chairman and CEO of Brazauro Resources Corporation, said, “We are very pleased to complete this title confirmation and to consolidate the entire Tocantinzinho area … We are reviewing the exploration information to date from the new areas now under Brazauro’s control, and will initiate further exploration activities here in the near-term.”

Medifocus Inc., a capital pool company, has made an announcement about the qualifying transaction with Celsion (Canada) Limited and its shareholders. The agreement between the companies is reported to be dated November 10, 2006.

In connection with the qualifying transaction, Medifocus has entered into a Share Exchange Agreement, under the terms of which the closing of the transaction is conditional upon, among other things, the completion of a concurrent public offering of company common shares, in an amount mutually acceptable to Medifocus and Celsion Canada. Subject to the terms and conditions of the Share Exchange Agreement, Medifocus has agreed to buy, and the shareholders of Celsion Canada have agreed to sell all of the Celsion shares to Medifocus. The direct purchase of the Celsion shares will be made by the payment of $166,667 and issuance on the closing date of 10,000,000 Medifocus Shares at a deemed issue price of $0.50 per share.

Medifocus Inc. is incorporated under the laws of Ontario province in Canada, and is a reporting issuer in the provinces of Ontario, Alberta and British Columbia.

Celsion (Canada) Limited is the owner of a proprietary medical technology, the Adaptive Phased Array technology, which precisely focuses microwave radiation to heat and destroys tumours. It is a corporation existing under the laws of Ontario. Its major shareholders are Dr. Augustine Cheung (the chief executive officer and a director of Celsion Canada), and Wy-Mann International Limited, a corporation incorporated under the laws of British Virgin Islands. Dr. Cheung is the registered and beneficial holder of fifty (50) Celsion Shares and Wy-Mann International is the registered and beneficial holder of twenty-five (25) Celsion Shares.

Under the qualifying transaction, the vendors are Dr. Augustine Cheung of Silver Spring, Maryland, Wy-mann International Limited, a British Virgin Islands corporation, Silver Lake Investment Partners Ltd., a British Virgin Islands corporation, Pearl Success Ltd., a British Virgin Islands corporation, Charles Shelton of Sparks, Maryland, and Douglas Stagnaco, Maryland.

As a result of the Qualifying Transaction, Celsion Canada will become a wholly-owned subsidiary of Medifocus. Upon completion of the Qualifying Transaction, Medifocus will carry on the business of Celsion Canada under current Celsion Canada management.

Uranium exploration company Deep Yellow Ltd has announced about its plans to raise $15.6 million through a non-renounceable entitlements issue. The company will issue the shares with the purpose to acquire the uranium interests of Raptor Minerals Ltd, a company incorporated in the British Virgin Islands. This transaction will provide the company with access to some prospective tenements in Namibia.

Deep Yellow will acquire ultimate control of Raptor subsidiary company Reptile Mineral Resources and Exploration (Pty) Ltd, by the initial payment of  2.5 million and issue up to 174 million shares, valuing the acquisition at approximately $26 million. As a part of the transaction, Deep Yellow Ltd must bring its consolidated cash and receivalbles balance to $20 million. Taking into account the company’s current cash position, this will require a cash injection of approximately $9.5 million.

Deep Yellow will offer up to 130.4 million new shares at 12c each to eligible shareholders on the basis of one new share for every five shares held. Offer’s Record Date is November 15,  the closing date for receipt of acceptances and applications is December 1. The funds raised are planned to be used to replenish company funds after the acquisition, to support the committed levels of expenditure on exploration programs, and to provide working capital.

Raptor Minerals Ltd has also appointed Mervyn Greene to the Deep Yellow board, where he will join company chairman Leon Pretorius, Martin Kavanagh and Gillian Swaby.

In the beginning of last week, 10.6% of Mt Gibson Iron were bought by Shanghai Merchants, a Hong Kong trader whose major shareholder is Shougang Holdings, part of Shougang Steel Group - China’s third largest steel producer. The shares were sold by COL Capital, which is part of Hong Kong-based investment group Sun Hung Kai, for $41m ($0.85 a share). Shanghai Merchants is listed on the Hong Kong Exchange; it has a market capitalisation of $US150 million ($195 million), which makes the Mt Gibson purchase a significant transaction. It is substantial that the shares were hold in the names of Honest Opportunity Ltd. and New Fortress Investments Ltd., both companies incorporated in the British Virgin Islands.

Shougang is the company to which Mt Gibson in June sold its 73% interest in Asian Iron, which owns the Extention Hill magnetite project for $52,5 million. Later it was acquired by Sinon Investment Holdings, which exercised pre-emptive rights, and which is controlled by a wealthy trader, Andy Zang. Funds from the sale are earmarked for development of Mt Gibson’s nearby Extension Hill hematite deposit.

Sun Hung Kai already holds another 5% of Mt Gibson. In this case the Sun Hung Kai group may build its stake further, via the purchase of the shares of Aztec Resources and acceptance of the bid, only with the approval of Foreign Investment Review Board. However, the sale of the 10.6% of Mt Gibson removes any potential FIRB barriers or objections.

At the moment the purchase is subject to the approval of Shanghai Merchants’ shareholders. It is also subject to a rights issue by Shanghai Merchants, on terms and conditions which are acceptable to the company.

The whisky and spirits company Inver House Distillers has announced on October 29 that it has become a fully-owned subsidiary of International Beverage Holdings, the international arm of Thai Beverages.

Inver House was an independent company until 2001, when it became owned by Pacific Spirits, part of Great Oriole Group based in the British Virgin Islands. This BVI company is controlled by Thai entrepreneur Charoen Sirivadhanabhakdi, who has significant interests in Thai Beverages.

It was marked by company representatives that the acquisition of Inver House by Thai Beverages brought the benefits of integration into a multi-beverage group of companies with international distribution, platforms and sales networks. The company declined to reveal the value of the acquisition, but from some sources it was understood to be worth approximately £60m. The combined value of the two companies after the merger is expected to be HK$1bn.

Inver House Distillers are now going to work in partnership with the International Beverage Holdings in Hong Kong and in other parts of south-east Asia, having received the possibility to offer a wider portfolio for the company’s customer base. The acquisition deal will also bring other advantages to the Inver House, including an increased focus on the development of Inver House Distillers’ brand portfolio, based on the success of its single malt whiskies and a range of whisky blends.

Having become part of Hong-Kong based InterBev, Inver House will join a stable or dynamic international alcohol beverage brands. Graham Stevenson, Inver House managing director, said: “Our single malt whisky brands and our blends are currently growing in terms of stature and volume, both in the UK and abroad, thanks to the dedicated team we have working in the business. The shift into InterBev will allow us to capitalise on this success, and it will make an enormous difference in terms of improving our route to market and facilitating exciting brand development and expansion in the future.”

A BVI-based Glaxen Corporation announced that it had sold 74.99% of Dagtelecom to the largest cellular operator in the former USSR countries and the top operator in Russia - Mobile TeleSystems (MTS). A British Virgin Islands company sold it for 14.7 million USD and gave the buyer an option to buy the remaining shares in future.

Dagtelecom provides cellular communication services in Dagestan where it has some 170000 customers and holds 11% of the market. Penetration level in the region currently is 59.1%. The company offers GSM-900 standard telecom services and MTS has a license to provide GSM-900/1800 standard telecom services, therefore they had much interest in the purchase that will let them start offering mobile phone services, improve their service quality, reduce the cost of entering the market and expand the MTS inter-network roaming zone.

MTS is currently participating in a tender to buy 90% of Armenian operator Armentel from Greece’s OTE. The company also has interest in the Commonwealth of Independent States (CIS) countries where it is not represented yet - Moldova, Azerbaijan, Armenia, Georgia, Tajikistan and Kazakhstan.