BEIJING, July 14, 2014 /PRNewswire/ -- General Steel
Holdings, Inc. ("General Steel" or the "Company") (NYSE: GSI), a
leading non-state-owned steel producer in China, today announced that the Company has
entered into a definitive Subscription Agreement (the "Subscription
Agreement") for a private placement of its common stock, par value
$0.001 per share ("Common Stock"),
with Henry Yu (the "Investor"), the
Company's Chairman and Chief Executive Officer. The gross proceeds
from the private placement will be approximately $7.5 million, and the Company intends to use the
proceeds to fund its expansion into high-growth bulk commodity
e-commerce.
Pursuant to the Subscription Agreement, the Investor purchased
from the Company and the Company issued and sold to the Investor
five million shares of Common Stock at a purchase price of
$1.50 per share (the "Purchase
Price"), for an aggregate amount of $7.5
million. The Purchase Price is approximately 23% higher than
that of the 90-day volume weighted average closing price of the
Common Stock from March 5, 2014 to
July 11, 2014, which ranged from
$0.90 to $1.47 per share of Common
Stock during the period. The Common Stock purchased and issued will
be subject to the six-month holding period provisions of Rule 144
of the Securities Act of 1933, as amended (the "Securities Act").
The private placement is expected to close in July 2014, subject to customary closing
conditions.
"My willingness to purchase shares at a premium price reflects
my optimism with General Steel's recovering trend in recent months
and the Company's long-term strategy and growth prospects," said
Henry Yu, Chairman and Chief
Executive Officer of General Steel. "I remain highly confident that
General Steel will earn positive net income in the second half of
2014, and my injection of additional capital will enable the
Company to expand its business scope. It is very clear to me that
our planned expansion into commodity e-commerce will enable the
Company to not only capitalize on significant growth opportunities
ahead but also help to generate positive returns for its
investors."
The purchase and issuance of the Common Stock set forth above
was exempt from the registration requirements of the Securities Act
pursuant to Section 4(a)(2) of the Securities Act and Regulation D
promulgated thereunder ("Regulation D"), based upon the
representations made by the Investor that he was an "accredited
investor" (as such term is defined under Rule 501 of Regulation D)
and that he was purchasing such securities without a present view
toward a distribution of the securities. In addition, there was no
general advertisement conducted by the Company in connection with
the sale of the securities.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of
these securities in any state in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under
the Securities Act and the applicable securities laws of any such
state.
About General Steel
General Steel, headquartered in Beijing, China, produces a variety of steel
products including rebar, high-speed wire and spiral-weld pipe. The
Company has operations in China's
Shaanxi and Guangdong provinces, Inner Mongolia Autonomous
Region, and Tianjin municipality
with seven million metric tons of crude steel production capacity
under management. For more information, please visit
www.gshi-steel.com.
To be added to the General Steel email list to receive Company
news, or to request a hard copy of the Company's Annual Report on
Form 10-K, please send your request to
generalsteel@asiabridgegroup.com.
Forward-Looking Statements
This press release may contain certain forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. These statements are based on management's
current expectations or beliefs about future events and financial,
political and social trends and assumptions it has made based on
information currently available to it. The Company cannot assure
that any expectations, forecasts or assumptions made by management
in preparing these forward-looking statements will prove accurate,
or that any projections will be realized. Actual results could
differ materially from those projected in the forward-looking
statements as a result of inaccurate assumptions or a number of
risks and uncertainties. These risks and uncertainties are set
forth in the Company's filings under the Securities Act of 1933 and
the Securities Exchange Act of 1934 under "Risk Factors" and
elsewhere, and include: (a) those risks and uncertainties related
to general economic conditions in China, including regulatory factors that may
affect such economic conditions; (b) whether the Company is able to
manage its planned growth efficiently and operate profitable
operations, including whether its management will be able to
identify, hire, train, retain, motivate and manage required
personnel or that management will be able to successfully manage
and exploit existing and potential market opportunities; (c)
whether the Company is able to generate sufficient revenues or
obtain financing to sustain and grow its operations; (d) whether
the Company is able to successfully fulfill our primary
requirements for cash; and (e) other risks, including those
disclosed in the Company's most recent Annual Report on Form 10-K,
filed with the United States Securities and Exchange Commission.
Forward-looking statements contained herein speak only as of the
date of this release. The Company does not undertake any obligation
to update or revise publicly any forward-looking statements,
whether to reflect new information, future events or
otherwise.
Contact Us
General Steel Holdings, Inc.
Joyce Sung
Tel: +1-347-534-1435
Email: joyce.sung@gshi-steel.com
Asia Bridge Capital Limited
Carene Toh
Tel: +1-888-957-3362
Email: generalsteel@asiabridgegroup.com
SOURCE General Steel Holdings, Inc.