Sino-Forest Corporation, a commercial forest plantation operator in China, announced recently the completion of its purchase of 230 million subscription shares in Hong Kong-listed Omnicorp Limited at a price per share of HK$1.82 for a consideration of HK$418.6 million or approximately US$53.7 million. The Share Subscription increased Sino-Forest’s voting interest in Omnicorp from approximately 19.8% to approximately 53.5% of the enlarged issued share capital of Omnicorp. On completion of the Share Subscription, Mr. Allen Chan was appointed Chairman and a non-executive director of Omnicorp and Mr. Judson Martin was appointed President and Chief Executive Officer and an executive director of Omnicorp. Mr. Chan is the Chairman and Chief Executive Officer and a director of Sino-Forest. Mr. Chan co-founded Sino-Forest in 1994. Mr. Martin is the Vice Chairman of Sino-Forest and has been a director of Sino-Forest since 2006. These appointments to the board of Omnicorp are effective immediately.
Sino-Forest also holds HK$212.3 million of existing convertible bonds of Omnicorp that were acquired in November 2007 and February 2009. Assuming full conversion of the Existing Convertible Bonds, Sino-Forest’s interest will increase to approximately 59.9% of the enlarged issued share capital of Omnicorp.
Omnicorp has a 60.4% ownership in Greenheart Resources Holdings Limited, and Sino- Forest, through its wholly owned subsidiary Sino-Capital Global Inc., owns a 39.6% minority stake. Greenheart is one of the largest forest concession owners and operators in Suriname, South America with a 178,000-hectare hardwood concession and harvesting rights. Mr. Chan said "We are pleased to strengthen our partnership with Omnicorp, which will help us secure quality wood fibre for our customers in China. This strategic transaction increases our ownership interest in Greenheart and its hardwood concession in Suriname and represents exciting opportunities for our shareholders. Sustainable harvesting and exporting of processed wood products from Suriname will contribute to the country’s economic development while helping to alleviate China’s domestic wood deficit."
Mr. Martin said "Omnicorp will be able to leverage Sino-Forest’s long established distribution network in China and benefit from Sino-Forest’s broad experience to better service our customers in the Chinese market. I look forward to working with Omnicorp’s management teams in Hong Kong and Suriname and to the next stage of Omnicorp’s development."
