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Convertible Loan Update and Notice of Results

16th Dec 2010 09:15

RNS Number : 0782Y
Sorbic International PLC
16 December 2010
 



 

 

Press Release

16 December 2010

 

 

Sorbic International plc

 

("Sorbic" or the "Company")

 

Convertible Loan Update and Notice of Results

 

 

Sorbic International plc (AIM:SORB), the third largest sorbates producer in China, announced on 26 August 2010 that it has raised approximately £3.5 million (before expenses) through the issue of convertible loan notes ( the "Loan Notes").

 

The proceeds of the loan notes are to be utilised to fund construction of the Company's new production facility in Ulanqab City, Inner Mongolia, work on which commenced in April 2010. The new site in Ulanqab City will double Sorbic's existing manufacturing capacity. The factory building is largely complete and construction remains on track in terms of budgeted cost and timeline and expects to be complete in late summer 2011.

One of the lenders in respect of the Loan Notes is Hermes Holdings Ltd ("Hermes") based in Seoul, Korea. They entered into a legally binding agreement to lend £1.6 million under the terms of the Loan Notes and are due to pay the Company directly. Hermes requires regulatory approval to move the funds out of Korea. Representatives of the Company met with Hermes on 10 December 2010 and the regulatory matters are now expected to be resolved in early 2011 and the Company expects to receive these proceeds in Q1 2011.

 

As at the end of October 2010, the Company had cash balances of approximately £6 million.

 

The Company expects to announce its preliminary results to 30 September 2010 on 23 December 2010. The results will show that Sorbic continues to trade profitability from its existing facility in Linyi.

 

- Ends -

 

For further information:

Sorbic International plc

Tel: +44 (0)7768 031 454

John McLean, Chairman

www.sorbicinternational.com

FinnCap

Geoff Nash / Ed Frisby / Simon Starr (broking)

Tel: +44 (0) 20 7600 1658

 

Media enquiries:

Abchurch Communications

Joanne Shears / Mark Dixon

Tel: +44 (0)20 7398 7709

joanne.shears@abchurch-group.com

www.abchurch-group.com

 

 

Notes to Editors: www.sorbicinternational.com

 

About Chahar Industrial Park

Chahar Industrial Park is located in Ulanqab City, Inner Mongolia, in the north of the Peoples Republic of China ("PRC") and is the traffic hub that links North China with its neighbour, Mongolia and the main land route for international trade from China to Mongolia, Russia and Europe. Ulanqab City has a total land area of 54.5 thousand square kilometres and a population of 2.73 million people and is a one hour to drive from Hohhot Baita Airport, which lies 130 kilometers east of Hohhot. Beijing is 300 kilometers (3 hour drive) to the south and Tianjin port is 400 kilometers away.

 

About Sorbic International plc

Sorbic International's principal activity is the production and sale of the food preservatives Sorbic Acid and Potassium Sorbate from its base in Linyi City, Shandong Province, Peoples Republic of China. Approximately half of Sorbic International's production is sold to overseas markets, across 46 countries and half into the Chinese domestic market.

 

Sorbic Acid is a naturally occurring organic compound that is used in all kinds of foods for its anti-decomposition and anti-fungus function and also in grains, medicines, cosmetics, toothpaste, tobacco, animal feed, latex, paper-manufacturing and pesticides. Potassium Sorbate is used to inhibit moulds and yeasts in many foods, such as cheese, wine, yogurt, dried meat, baked goods, cosmetics and pharmaceuticals.

This information is provided by RNS
The company news service from the London Stock Exchange
 
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