Guilin Paper Inc. Entered Into A Strategic Agreement With Dabu Paper Manufacturing Inc.
New York, NY - Guilin Paper, Inc., a leading manufacturer of paper products and wood pulp in Guangdong and Guangxi provinces in China, announced recently that, on November 08, 2007, as part of its strategic plan to increase production and sales of higher profit margin products, its wholly-owned subsidiary, Guangxi Forestry Lipu Paper Company Limited ("Lipu Paper"), entered into an agreement with Dongguan Dabu Paper Manufacturing, Inc. ("Dabu Paper") to increase its supply of wood pulp to Dabu Paper.
Dabu Paper is a major manufacturer of paper packaging in southern China, with an annual production capacity of more than 300,000 tons and 2006 revenues of U.S.$13.33 million. Dabu Paper requires 60,000 tons of pure wood pulp to maintain its current production levels. This agreement could lead to Lipu Paper supplying up to 20% of Dabu Paper's wood pulp requirements.
Fangde Zhang, the Chief Executive Officer of the Company, stated that, "we are very pleased to have entered into this strategic agreement with Dabu Paper. Part of our overall strategy is to continue to expand sales of higher profit margin products, improve paper quality and expand our geographic reach. We believe this strategy will enable us to acquire a larger customer base and increase market share. This agreement is a positive first step in this direction and one which we believe will have a significant impact on our future wood pulp revenues which in turn will have a positive effect on our financial results as a whole."
Business Background
CORPORATE HISTORY
We were originally incorporated in the State of Nevada on March 2, 2004 under the name LogSearch, Inc. Our original business plan was to market and sell database management and analysis software to the oil & gas industry in the United States pursuant to a Commercialization Agreement with Unitech Energy Corp.
On April 18, 2007, the Company, LGSE Merger Sub, Inc., a Nevada corporation and a wholly-owned subsidiary of the Company ("Merger Sub"), China Lipu Paper Limited, a British Virgin Islands corporation ("CLP"), and the shareholders of CLP entered into an Agreement and Plan of Merger pursuant to which Merger Sub was merged with and into CLP and the Company issued 27,027,968 shares of its common stock to the shareholders of CLP in exchange for 100% of the registered capital of CLP. The Company then changed its name to Guilin Paper, Inc.
These transactions were treated for financial reporting purposes as a reverse acquisition, with Guilin Paper, Inc. (formerly LogSearch Inc.) being the surviving entity. The Company did not recognize goodwill or any intangible assets in connection with the transaction. Prior to the reverse acquisition, the Company was a shell company with no significant assets and liabilities.
We conduct our operations principally in China through our wholly-owned operating subsidiaries, Guangxi Forestry Lipu Paper Company Limited, Guangxi Lvbao Waste Paper Recycling Company Limited and Guangxi Hengli Power Company Limited. To date, all of our sales are made domestically in China.
Business Description
Guilin Paper, Inc. mainly engages in paper making, paper pulp production and power generation. The Company uses a series of high-tech and high value-add processes to produce special packaging paper and writing paper. In the next five years, the company will strive to produce the highest quality packaging paper and writing paper, and increase its market share to rank as one of the top 10 paper manufacturers in China.
Guangxi Forestry Lipu Paper Company Limited
Our primary business is conducted through our subsidiary Guangxi Forestry Lipu Paper Company Limited, which produces and sells high quality paper products primarily for packaging applications, including kraft paper, a durable, typically brown paper made from wood pulp, which is used predominantly for bags, wrapping paper and cardboard; and high-grade specialty papers designed for custom packaging applications. The Company has a diversified product portfolio with various types, grades, burst indices, stacking strengths, basis weights, printability and brands to meet a variety of customer requirements.
Guangxi Forestry Lipu Paper Company Limited is a leading player in the papermaking industry in both Guangzhou and Guangxi provinces in China. Lipu Paper has three major production lines, seven papermaking machines and over 600 employees, with an annual production capacity of over 100,000 tons.
Guangxi Lvbao Waste Paper Recycling Company Limited
On April 7, 2000, Guangxi Lvbao Waste Paper Recycling Company Limited was founded to engage in the business of waste paper recycling.
Guangxi Hengli Power Company Limited
On December 24, 2003, Guangxi Hengli Power Company Limited was founded to provide stable and inexpensive electricity to Guilin Paper Inc. Hengli has over 60 full time employees.
SOURCE: Guilin Paper, Inc.