HARBIN, China, Nov 01, 2010 (BUSINESS WIRE) -- China Kangtai Cactus Biotech Inc. /quotes/comstock/11k!ckgt (CKGT 1.21, +0.01, +0.83%) , a vertically integrated grower, developer, manufacturer and marketer of a variety of cactus-based products in China, announced today that it is ready to commence the pre-production stage of testing the equipment for the in-house manufacturing of their own cigarettes starting November 2010.
Pursuant to a definitive asset purchase agreement signed on June 28, 2010, CKGT made an acquisition that includes certain real property and all improvements thereon, all equipment and fixtures used in connection with the Seller's operations, as well as, the established brands attached thereto located in Guangdong province and Macao for a price of RMB (Renminbi) 35 million (approximately USD $5.1 million).
While the pre-production stage commences in November of this year, full production is expected by March 2011. The estimated production of cigarettes manufactured in-house by CKGT is 55% of the total volume of cigarettes produced for CKGT (with the remaining 45% being outsourced). CKGT's revenue estimates from cigarettes for 2011 will account for 20% of the total revenue. Cactus cigarettes will be a key product of CKGT's full product line.
About China Kangtai Cactus Biotech, Inc.
China Kangtai Cactus Biotech, Inc. is a leading grower, developer, producer, and marketer of cactus-derived products, including nutraceuticals, nutritious food, health and energy drinks, beer, wine and liquor, extracts and powders, and animal feed. China Kangtai controls over 387 acres of plants and maintains an active R&D group that holds 18 product patents and is seeking another 12. China Kangtai's high-quality "green" products are sold throughout China via a distribution network that covers 12 of China's 23 provinces and two of China's four municipalities.
This news release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks contained in reports filed by the company with the Securities and Exchange Commission. All such forward-looking statements, whether written or oral, and whether made by or on behalf of the company, are expressly qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date here of.
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