China Growth Equity Investment Ltd., a special purpose acquisition company registered as Cayman Islands exempt company and listed on the Nasdaq, entered into a definitive merger agreement with China Dredging Group Co., Ltd - a limited liability company, registered in the British Virgin Islands and based in China, and with Fujian Provincial Pingtan County Ocean Fishing Group Co., Ltd. By terms of the agreement, China Growth is to merge with China Dredging Group, and to acquire Pingtan Fishing.
The combined entity will be renamed into Pingtan Marine Enterprise Ltd. Upon completion of the merger and the acquisition, the founder, Chairman and controlling shareholder of China Dreedging Group and Pingtan Fishing, Xinrong Zhuo, will become the chairman of the merged company.
China Dredging Group is a BVI holding company, focused on providing dredging services in China through its Chinese subsidiary. Pingtan Fishing is a rapidly growing fishing company, providing quality seafood in China.
Upon completion of the transaction, China Growth shareholders will own approximately 7.75% of the outstanding ordinary shares of the combined company. After the closing, China Growth will have approximately 78,962,376 ordinary shares outstanding, valuing the company at approximately $783 million.
The business combination is subject to the approval of shareholders of China Growth Equity, and is expected to be completed in the first quarter of 2013.
Xuesong Song, China Growth's board chairman, said in his comments on the transaction: "CGEI's combination with CDGC and Pingtan Fishing is the culmination of our search for a successful company with a proven track record of profitability and attractive growth prospects… We believe that CDGC's highly profitable dredging business represents a unique opportunity as one of the largest dredging providers in China. Pingtan Fishing provides the combined company with a strong and fast growing platform in a fragmented industry."
