* Further Favorable Revisions to Sing Kung Acquisition Terms * Related Proxy Statement/Prospectus Declared Effective * Shareholder Meeting Set for August 27, 2009 to Vote on the Transaction * NASDAQ Listing Status * Presentation Scheduled at Rodman & Renshaw Investment Conference
SAN DIEGO, Aug. 18, 2009 (GLOBE NEWSWIRE) -- InterAmerican Acquisition Group Inc. (OTCBB:IAQG) (OTCBB:IAQGW) (OTCBB:IAQGU) ("IAG") and its wholly-owned subsidiary, CNC Development Ltd. ("China New Cities Development" or "CNC") announced further favorable revisions to the acquisition terms for Sing Kung Limited ("Sing Kung" or "the Company") and the effectiveness of the proxy statement/prospectus relating to the transaction. Sing Kung is an integrator of planning, financing and construction of turnkey infrastructure projects for municipalities in the People's Republic of China ("PRC").
IAG will hold a special meeting of shareholders for purposes of voting on the Sing Kung acquisition and its redomestication merger with CNC on Thursday, August 27, 2009 for shareholders of record as of Wednesday, August 5, 2009.
Revised Transaction Terms Deliver Value Exceeding Funds in Trust
In July 2009, IAG and Sing Kung revised the terms of their transaction to reflect current market conditions and adjusted financial projections for Sing Kung. The amended agreement provides for IAG shareholders to receive upon closing a package of cash and securities having a value estimated by management to exceed the no-vote conversion payments or trust liquidation proceeds by about 13%. For this reason and others described in the proxy statement/prospectus, the IAG board of directors has recommended that IAG shareholders approve the transaction. Specifically IAG shareholders will receive the following:
* Cash closing dividend of $4.85/share * CNC convertible preferred stock having a face value of $2.66 with an annual 7% dividend paid quarterly * CNC common stock
The CNC Class A Preferred Stock to be issued in the transaction includes strong protections for IAG shareholders and the conversion right delivers added value. These are fully described in the proxy statement/prospectus, but can be summarized as follows:
* Seniority relative to common stock being issued to Sing Kung shareholders, including a liquidation preference equal to $2.66 per IAG share. * Dividends accrue quarterly at annual rate of 7% of face value and the dividend rate increases if the RMB: US$ exchange rate increases (and vice versa). * Each Class A Preferred Share is convertible into one share of CNC Common Stock and includes anti-dilution protections. If converted, IAG shareholders would own from 17.1% to 22.3% of combined company depending on number of incentive shares issued to management in the future. * Conversion terms anticipate a common stock value greater than 1.7X face value of Class A Preferred before conversion would be mandatory. * The Class A Preferred has governance control of the combined company until certain performance conditions are met, protecting the holders against dilutive stock issuances, acquisitions and borrowing that could jeopardize the senior status of the Class A Preferred shares. * Class A Preferred shares become redeemable in 4 years if performance targets not achieved by CNC.
NASDAQ Listing Approval Sought for CNC
IAG received approval in February 2009 to be listed on the NASDAQ Stock Exchange, but elected to defer listing its stock until consummation of the acquisition of Sing Kung. With the Sing Kung transaction now imminent, the Company is seeking listing approval from NASDAQ for CNC's securities effective upon consummation of the redomestication merger and closing of the Sing Kung acquisition. Such approval requires formal review of CNC's corporate and governance structure by NASDAQ and confirmation that the post-merger entity meets NASDAQ's quantitative criteria for initial listing. The Company plans to initiate NASDAQ trading for CNC's common and preferred stock and warrants immediately following closing of the Sing Kung acquisition, or as soon thereafter as NASDAQ listing approval is received. The Sing Kung transaction is anticipated to occur prior to September 10, 2009 if the requisite number of IAG's stockholders approve.
Presentation at Rodman & Renshaw Conference
Subject to an affirmative vote from its shareholders, CNC will present at the Rodman & Renshaw Annual Global Investment Conference in New York City at 10:50am on September 10, 2009. IAG's CEO, William Morro will be making the presentation.
About IAG and CNC Development Ltd.
IAG was formed for the purpose of acquiring, through a merger, stock exchange, asset acquisition or other similar business combination, an unidentified operating business. It formed a subsidiary, CNC Development Ltd. for the sole purpose of effecting a redomestication merger and acquiring Sing Kung. IAG is located in San Diego, California with offices at 2918 Fifth Ave., Suite 209. Additional information about IAG and CNC Development Ltd. is available on the IAG website: http://iaaginc.com or in IAG's public filings available from the SEC website: (http://www.sec.gov)
About Sing Kung Limited
Sing Kung Limited (BVI), through its PRC operating subsidiary, forms and leads consortiums to deliver comprehensive city planning and infrastructure build-outs to selected municipalities throughout China. The company's "Build-Transfer" business model allows local governments to overcome financial and project management constraints and to quickly unlock economic development potential and property value. Sing Kung delivers turnkey solutions to progressive cities that are expanding or redeveloping urban cores to meet explosive growth. In addition to supporting its clients with municipal development strategies, detailed planning and fully-financed project implementation, the company also offers municipal government leaders support in obtaining long-term replacement financing and later-phase commercialization and project marketing. For more information, please refer to http://www.cncdev.com.
Forward-looking Statements
Additional information regarding IAG, Sing Kung and China New Cities Development is contained in the final proxy statement/prospectus that IAG and China New Cities Development jointly filed with the Securities and Exchange Commission on August 10, 2009. A copy of the filing in its entirety is available at http://www.sec.gov. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, the securities covered by the prospectus nor shall there be any sale of such securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, about IAG, Sing Kung and their combined business after completion of the proposed acquisition. Forward-looking statements are statements that are not historical facts. Such forward-looking statements, based upon the current beliefs and expectations of IAG's and Sing Kung's management, are subject to risks and uncertainties, which could cause actual results to differ from the forward looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: business conditions in China; continued compliance with government regulations; legislation or regulatory environments, requirements or changes adversely affecting the businesses in which Sing Kung is engaged; cessation or changes in government incentive programs: fluctuations in customer project schedules and requirements; intensity of competition from other providers of urban and infrastructure planning and construction; general economic conditions; geopolitical events and regulatory changes, as well as other relevant risks detailed in the filings with the Securities and Exchange Commission, and the proxy statement/prospectus of IAG and its BVI subsidiary, CNC Development Ltd. (SEC File No. 333-152977 and 333-152977-01, respectively). The information set forth herein should be read in light of such risks. Neither IAG nor Sing Kung assumes any obligation to update the information contained in this press release.
In connection with the pending transaction, IAG and China New Cities Development filed with the SEC a final proxy statement/prospectus for the stockholders of IAG. The stockholders of IAG are urged to read the final proxy statement/prospectus, as well as all other relevant documents filed or to be filed with the SEC, because they will contain important information about Sing Kung, China New Cities Development, IAG and the proposed transaction. The final proxy statement/prospectus has been mailed to stockholders of record of IAG and IAG stockholders may also obtain the registration statement (and proxy materials contained therein) and any other relevant filed documents without charge at the SEC's website (http://www.sec.gov ), or from IAG directly by forwarding a request to Ana Ponce, c/o InterAmerican Group, 2918 Fifth Ave., Suite 209, San Diego, CA 92103.
China New Cities Development, IAG and their respective directors and officers may be deemed to be participants in the solicitation of approvals from IAG stockholders in respect of the proposed transaction. Information regarding IAG's participants is available in the final proxy statement/prospectus together with additional information regarding the interests of such participants.