SOURCE: China ACM

China ACM

November 18, 2010 07:55 ET

China ACM and China Construction Sign Strategic Alliance LOI

BEIJING--(Marketwire - November 18, 2010) - China Advanced Construction Materials Group, Inc. (NASDAQ: CADC) ("China ACM"), a leading provider of ready-mix concrete and related technical services in China, today announced that China State Construction Engineering Corporation ("China Construction" or "CSCEC") (Shanghai SE: 601668) and the Company have signed a strategic alliance letter of intent. With annual revenue of $38 billion, CSCEC is ranked number 187 in the Fortune Global 500 list of companies.

Under the terms of the agreement, China ACM will serve as the preferred provider of its eco-friendly ready-mix concrete and related engineering services to CSCEC's Second Engineering Bureau Division of its Third Construction Engineering Company Ltd. Both companies agree to "cooperate strategically in international and national markets, support each other and share resources so as to increase their competitiveness in the world construction market."

China ACM will also collaborate with and support CSCEC in the preparation of bids and proposals, provide access to its intellectual property and share capital resources to reduce capital requirements and increase cash flow.

"Signing a 'Strategic Cooperation Letter of Intent' with a major operating division of a company such as CSCEC, a globally ranked stated owned enterprise, holds great importance in China and enhances our leadership position with all existing and potential clients throughout the industry," said Jeremy Goodwin, China ACM president and chief financial officer. "This agreement provides a specific framework for cooperation to improve the competitiveness of both companies in China and worldwide -- across the board from high speed rail to real estate."

Mr. Xianfu Han, China ACM Chairman and Chief Executive Officer, said, "In Asia, market position and relationships are everything -- from which all good new business, sales and opportunities flow. Following our first commercial bank debt financings recently, this agreement is yet another historic milestone for China ACM, as we continue to strengthen our leadership position in the China infrastructure and concrete marketplace."

"We appreciate the CSCEC's trust and confidence, and are entirely confident this agreement will lead to increasing new business with and through CSCEC this year and beyond," Mr. Han added.

China ACM was contracted by CSCEC for ready-mix concrete related services on the prestigious CCTV Headquarters as well as the Beijing Olympics Water Cube. Photos and profiles of these and other noteworthy Company projects may be viewed at its new website, at http://www.china-acm.com/project-profiles

China State Construction Engineering Corp., www.cscec.com.cn, raised $7.3 billion in its 2009 initial public offering, the world's largest IPO of 2009. CSCEC built the "Water Cube" swimming center for the Beijing Olympics. It is China's biggest builder of housing and also is known for such showcase projects as the futuristic state CCTV Headquarters and China's tallest skyscraper, the 1,614-foot-tall (492-meter-tall) Shanghai World Financial Center.

About China Construction
China State Construction Engineering Corp. Ltd. ('China Construction' in short), formally established on December 10, 2007, was co-initiated by four top-500-global member enterprises: China State Construction Engineering Corp. (CSCEC), China National Petroleum Corporation (CNPC), Baosteel Group Corp. Ltd. and Sinochem Corporation.

China Construction inherited all the choice assets and culture of China State Construction Engineering Corp.(CSCEC), making it so far the most competitive building enterprise group in China, with a business scope ranging from housing construction, international building contracting to real estate development and investment, infrastructure construction and investment, prospecting and designing, etc.

Founded in 1982, CSCEC has been a backbone enterprise directly under the management of the central government. Starting as its core businesses of housing construction, international building contracting, property development, infrastructure construction and municipal survey and design, CSCEC has now become the largest building and real estate enterprise in China, as well as the top international contractor in China. CSCEC is an enterprise expanding itself without mass capital and sources from the government, but only through competition. And it is the only building enterprise holding three highest class qualification certificates in China. For more information, visit www.cscec.com.cn.

About China ACM
China ACM is a leading producer of advanced, certified eco-friendly ready-mix concrete (RMC) and related technical services for large scale, high-speed rail (HSR) and other complex infrastructure projects. Leveraging its proprietary technology and value-add engineering services model, the Company has won work on numerous high profile projects including the 30,000 km China HSR expansion, the Olympic Stadium Bird's Nest, Beijing South Railway Station, Beijing International Airport, National Centre for Performing Arts, CCTV Headquarters, Beijing Yintai Building and U.S. and French embassies.

Founded in 2002, Beijing-based China ACM provides its materials and services through its network of fixed ready-mix concrete plants covering the Beijing metropolitan area. It also has technical services and preferred procurement agreements with other independently-owned plants across China. Additionally, the Company owns numerous portable plants deployed in various provinces across China. More information about the Company is available at www.china-acm.com.

Forward-Looking Statements
This press release contains statements that are forward-looking in nature, including statements regarding the Company's competitive position and product and service offerings. These statements are based on current expectations on the date of this press release and involve a number of risks and uncertainties, which may cause actual results to differ significantly from such estimates. The risks include, but are not limited to, the degree of market adoption of the Company's product and service offerings; market competition; dependence on strategic partners; and the Company's ability to manage its business effectively in a rapidly evolving market. Certain of these and other risks are set forth in more detail in "Item 1A. Risk Factors" in China ACM's Annual Report on Form 10-K for the fiscal year ended June 30, 2010. China ACM does not assume any obligation to update or revise any such forward-looking statements, whether as the result of new developments or otherwise.

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