News
Maple Leaf Enters Agriculture Industrialization Cooperation Agreement
(TSX-V: MPE)Last Close: May 14, 2009 - $0.11
Shares Issued: 56,511,127
Maple Leaf Reforestation Inc. ("Maple Leaf" or the "Company") is pleased to announce that it has agreed to partner with Hanshou County Jinmandi Agriculture Development & Plantation Center (“Jinmandi”), which is owned by Guangdong Jingsheng Investment Co., Ltd., to construct an eco-agricultural conglomerate of facilities in Hanshou County (the “Facilities”). Jinmandi will invest up to $30 million Cdn (165 million Rmb) to build a pig farm, a fertilizer plant and a red potato plantation and processing plant. Construction and operation of the Facilities will be the responsibility of Jinmandi and Maple Leaf will provide marketing and financial management support, both during the construction and operational phases. Jinmandi will be solely responsible for all financial expenditures and liable for all financial risks and liabilities relating to the construction and operation of the Facilities.
The first phase of construction of the Facilities is to build the pig farm (the “Farm”), and it is anticipated that ground will be broken on this project in May 2009. The Farm will be 10,000 square meters in size and will have a 900 meter paved road leading to the entrance. Jinmandi will invest approximately $2.1 million Cdn (11.55 million Rmb) to build the Farm and 8 to 10 acres (50-60 mu) of land will be contributed by Maple Leaf to Jinmandi for the location of the Farm (the “Facility Lands”). It is anticipated that the Farm will house up to 10,000 pigs at any one time, and current market prices indicate that the pigs will be sold for net profits of approximately $275 Cdn (1,500 Rmb) per pig. Jinmandi anticipates that the Farm will be profitable by 2011.
Jinmandi and Maple Leaf will own 90% and 10% of the Farm respectively, and profits will be shared between the parties according to this ownership ratio. The ownership ratio for the fertilizer plant and red potato plant will be negotiated separately and announced at a later time.
Maple Leaf will also be independently using some of the Facility Lands to grow 20,000 date trees and some watermelon patches. All revenue from these sources will be Maple Leaf’s. Dates are presently a very popular consumer product in China. Based on current market prices for dates at $1.85 Cdn (10 Rmb) a kilogram and 10 kilograms of date production per tree upon maturity in 3 to 5 years, it is anticipated that approximately $365,000 Cdn (2 million Rmb) in revenue per year will be derived from this product.
Raymond Lai, President and Chief Executive Officer of Maple Leaf comments, “The Cooperation Agreement with Jinmandi is a positive step forward for Maple Leaf in terms of aligning itself with major players in the Chinese Agricultural Industry and it provides yet another revenue stream for the Company, and does so without Maple Leaf having to expend any capital. We hope that this is just the beginning of our relationship with Jinmandi as the synergies between its business plans and Maple Leaf’s operations are very evident.”
About Maple Leaf Reforestation Inc.
Maple Leaf is a Canadian company operating a large-scale forest nursery whose primary focus is growing value- added tree seedlings and alfalfa feedstock alongside landscaping and nursery products in China. In addition, the multi-faceted Xinjiang Yellowhorn tree project will provide for the manufacture of biodiesel fuel. Reforestation has been identified as a critical strategy to help manage China’s troubling environmental issues, namely pollution and desertification. Maple Leaf currently has over 6 million varieties of seedlings under cultivation at its nursery facility that includes a 110,000-square foot greenhouse located in Liang Cheng, Inner Mongolia, China.
Maple Leaf is a wholly-owned foreign enterprise ("WOFE"), which allows Maple Leaf to control 100% of the direction and operations of the company in China while permitting the cash generated from operations in China to flow back to Canada.
For further information regarding Maple Leaf Reforestation Inc., visit www.mlreforestation.com or contact:
Maple Leaf Reforestation Inc.
Raymond Lai, Chairman, President & CEO
Tel: +1 (403) 668-7560 Fax: +1 (403) 250-2534
E-mail: rlai@mlreforestation.com
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.
Certain statements in this news release including (i) statements that may contain words such as "anticipate", "could", "expect", "seek", "may” "intend", "will", "believe", "should", "project", "forecast", "plan" and similar expressions, including the negatives thereof, (ii) statements that are based on current expectations and estimates about the markets in which Maple Leaf operates and (iii) statements of belief, intentions and expectations about developments, results and events that will or may occur in the future, constitute "forward-looking statements" and are based on certain assumptions and analysis made by Maple Leaf. Forward-looking statements in this news release include, but are not limited to, statements with respect to future capital expenditures, including the amount, nature and timing thereof; other development trends within the China's seedling industry; business strategy; expansion and growth of Maple Leaf's business and operations and other such matters. Such forward-looking statements are subject to important risks and uncertainties, which are difficult to predict and that may affect Maple Leaf's operations, including, but are not limited to: the impact of general economic conditions; industry conditions; government and regulatory developments; seedling product supply and demand; competition; and Maple Leaf's ability to attract and retain qualified personnel. Maple Leaf's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do transpire or occur, what benefits Maple Leaf will derive there from. Subject to applicable law, Maple Leaf disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
All forward-looking statements contained in this document are expressly qualified by this cautionary statement. Further information about the factors affecting forward-looking statements is available in other disclosure documents of Maple Leaf which have been filed with Canadian provincial securities commissions and are available on www.sedar.com.