Biomagnetics Announces LOI to Acquire Zhuhai Oil Energy-To Inherit Biofuel Contract for Guangdong Powerplant
SAN FRANCISCO-- July 19, 2010 (BUSINESS WIRE)--Biomagnetics Diagnostics Corp., (PINK SHEETS: BMGP)a developer of revolutionary diagnostic systems and technology for HIV, hepatitis, tuberculosis and malaria detection, and other innovative technologies, today announced the signing of a Letter of Intent (LOI) with Zhuhai Oil Energy Science and Technology Ltd., an inventor and producer of unique gasoline and diesel biofuel blends, located in the Guangdong Province, China. The acquisition of Zhuhai is the second in a series of planned highly accretive Chinese technology and product acquisitions targeted at a $1.00 share price for Biomagnetics’ common shares.
Under the terms of the LOI, Biomagnetics will acquire all assets of Zhuhai, including the intellectual property for proprietary formulations for very low carbon footprint biofuel blends, future patents to be filed for these formulations, and rights to a previously signed three-year contract to supply this unique biofuel to an electricity power plant, also located in Guangdong. Biomagnetics and Zhuhai plan to file for both Chinese and international intellectual property protection (patent) protection on these formulations shortly after the closing of this proposed acquisition.
While coal remains the primary fuel for electricity production throughout most of China, the situation in Guangdong is very different with the province having built more than 10 million kW of fuel oil power generation over the past two decades to meet electricity demands from the rapidly growing export-oriented manufacturing industry in the Pearl River Delta. Environmental pressures are forcing a rapid change in electricity generation throughout Guangdong with many of these Guangdong fuel oil power plants turning toward natural gas or cleaner burning fuel oils. Zhuhai has already signed one major contract to supply a local power plant with its low carbon footprint fuel blend and it will seek to supply its products to other power plants as additional production capacity is added.
“We are very enthusiastic about our potential participation in the “Green Revolution” occurring throughout China, commented Clayton Hardman, CEO of Biomagnetics. “While a rapid shift in energy policy is occurring throughout China, the industrial areas of southern China are seeing exceptionally strong pressure to reduce the impact of electricity production on the environment. The Zhuhai low carbon footprint biofuel formulations significantly reduce particulate and carbon emissions, but are still cost competitive. Zhuhai has not yet begun delivery under its large power plant contract, but plans commencement upon the filing of the intellectual property protection applications. We believe the acquisition of Zhuhai, when combined with the acquisition of the proprietary, biodegradable PVA plastic film business from Lanzhou New Technology Development, which we announced last week, add significant value to current and future Biomagnetics common shareholders, with a very minimal shareholder dilution relative to the strong set of assets and the very robust expected revenue and profit streams being acquired.”
Relative to the acquisition of Zhuhai, Biomagnetics will issue a total of 10 million shares of common stock for the purchase and will agree to capitalize Lanzhou with the minimum capital of $1,000,000 over the next 90 days. Biomagnetics believes this highly accretive proposed acquisition, which is proposed at a significantly attractive valuation, will add meaningfully to Biomagnetics common shareholder value.
The Company plans to soon announce a conference call to further discuss this and other technology and product acquisitions planned by the Company and to provide a status update on its ongoing relationship with Los Alamos National Security, LLC for the development of the world's first commercially available integrated optical biosensor product for the detection of human and animal pathogens, which cause diseases and conditions such as tuberculosis, malaria, HIV/AIDS and cholera.
About Biomagnetics Diagnostics Corp.
Biomagnetics Diagnostics Corporation is an advanced medical device and biotechnology company. The Company’s revolutionary diagnostic systems, which are based on advanced magnetics, test for any viral or bacterial disease using any body fluid. The Company's technology allows laboratories to perform far more tests in the same amount of time it takes to do a single test. The HTS-MTP platform is designed to detect the actual virus and viral load in body fluids and not just simply screen for the presence of viral antibodies. More information on Biomagnetics Diagnostics Corp. can be seen at www.BiomagneticsBMGP.com.
Joe Noel, 925-922-2560
Biomagnetics Diagnostics Corp.