ChinaNet Online Receives US$3.5 Million Strategic Investment from Jinrun Technology
May 07 2015 - 7:30AM
ChinaNet Online Holdings, Inc. (Nasdaq:CNET) ("ChinaNet" or the
"Company"), a leading B2B (business to business) Internet
technology company providing online-to-offline (O2O) sales channel
expansion services for small and medium-sized enterprises (SMEs)
and entrepreneurial management and networking services for
entrepreneurs in the People's Republic of China, announced today
that it entered into a definitive securities purchase agreement
(the "Agreement") with Beijing Jinrun Fangzhou Science &
Technology Co., Ltd. (Shenzhen Stock Exchange, Stock Code: 430120)
(the "Purchaser" or "Jinrun Technology") to raise US$3,500,000 (the
"Purchase Price"), pursuant to which the Purchaser has agreed to
purchase 2,800,000 shares of common stock of the Company (the
"Shares").
In accordance with the Agreement, the Purchaser made a ten
percent (10%) non-refundable guarantee payment to the Company in an
amount equal to US$350,000 on May 7, 2015. The Purchaser shall pay
an additional fifteen percent (15%) of the Purchase Price by June
4, 2015. The Purchaser shall pay the remaining seventy-five percent
(75%) of the Purchase Price at the closing which shall take place
on the date mutually agreed to by the parties, subject to the
closing conditions contained in the Agreement. On the date the
Agreement was signed, the Purchaser also entered into a Lock-Up
Agreement with the Company, whereby the Purchaser agreed not to
transfer the Shares until May 5, 2017. Upon the Company's prior
written approval, the lock-up restriction may be waived after May
5, 2016.
The proceeds from the offering, net of certain fees and
expenses, will be used for working capital to fund technology
research and development, marketing for new services and product
launches, and potential mergers and acquisitions.
"This capital investment from Jinrun Technology is an important
development for ChinaNet," said George Chu, Chief Operating Officer
of ChinaNet Online Holdings. "We think this capital infusion will
be extremely positive in our expansion of Business Direct 3.0 with
other new services to be launched in the next three years. It is
also very positive for us to help increase our market penetration
in the SME segment. Furthermore, we have found a great synergy with
Jinrun Technology for a new business revenue model. In the same way
that city governments use Jinrun Technology's technology to monitor
the costs of a public construction project and maintain a fair and
transparent bidding and selection process, Chinese SME business
owners can also utilize Jinrun Technology's product and services.
SME business owners can monitor costs, increase the transparency of
their business sourcing and purchasing process and find the best
price to quality supply or service needed on an e-commerce platform
through internet or mobile. It is the exact type of collaboration
that we would anticipate from a strategic investor like Jinrun
Technology, and we believe it will lead to a new revenue stream for
us in the future."
About Jinrun Fangzhou Science & Technology Co.,
Ltd.
Beijing Jinrun Fangzhou Science & Technology Co., Ltd.,
founded in 2003 is one of the first information software vendors in
the construction industry. Headquartered in Beijing, China, Jinrun
Technology has nearly 200 employees and offers its services in more
than 10 provinces and autonomous regions including the cities of
Beijing, Tianjin, Chongqing, Fujian, Sichuan, Gansu, Xinjiang,
Haikou and Changsha. The company is committed to provide the
highest quality of information technology products and services in
the construction industry. Its products primarily cover two series:
engineering electronic bidding systems and construction
economics-systems. Jinrun Technology's market share in engineering
electronic bidding system is over 45%. On April 27, 2012, Jinrun
Technology officially listed on the Shenzhen Stock Exchange, Stock
Code: 430120. For more information please visit
www.jinrunsoft.com.
About ChinaNet Online Holdings, Inc.
The Company, a parent company of ChinaNet Online Media Group
Ltd., incorporated in the BVI ("ChinaNet"), is a leading digital
B2B (business to business) Internet technology company focusing on
providing O2O sales channel expansion service for small and
medium-sized enterprises (SMEs) and entrepreneurial management and
networking service for entrepreneurs in China. The Company, through
certain contractual arrangements with operating companies in the
PRC, provides Internet advertising and other services for Chinese
SMEs via its portal websites, 28.com, Liansuo.com and Chuangye.com,
TV commercials and program production via China-Net TV, and
in-house LCD advertising on banking kiosks targeting Chinese
banking patrons. Website: http://www.chinanet-online.com.
Safe Harbor
This release contains certain "forward-looking statements"
relating to the business of ChinaNet Online Holdings, Inc., which
can be identified by the use of forward-looking terminology such as
"believes," "expects," "anticipates," "estimates" or similar
expressions. Such forward-looking statements involve known and
unknown risks and uncertainties, including business uncertainties
relating to government regulation of our industry, market demand,
reliance on key personnel, future capital requirements, and
competition in general and other factors that may cause actual
results to be materially different from those described herein as
anticipated, believed, estimated or expected. Certain of these
risks and uncertainties are or will be described in greater detail
in our filings with the Securities and Exchange Commission. These
forward-looking statements are based on ChinaNet's current
expectations and beliefs concerning future developments and their
potential effects on the Company. There can be no assurance that
future developments affecting ChinaNet will be those anticipated by
ChinaNet. These forward-looking statements involve a number of
risks, uncertainties (some of which are beyond the control of the
Company) or other assumptions that may cause actual results or
performance to be materially different from those expressed or
implied by such forward-looking statements. ChinaNet undertakes no
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as may be required under applicable securities
laws.
CONTACT: MZ North America
Ted Haberfield, President
Direct: +1-760-755-2716
Email: thaberfield@mzgroup.us
Web: www.mzgroup.us
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