Grand Power Logistics Group Inc.
TSX VENTURE : GPW

Grand Power Logistics Group Inc.

January 17, 2011 12:32 ET

Grand Power Subsidiary Receives Approval to Set Up a Chinese Company for the Yangshan Project

CALGARY, ALBERTA and HONG KONG, CHINA--(Marketwire - Jan. 17, 2011) - Grand Power Logistics Group Inc. ("Grand Power" or the "Company") (TSX VENTURE:GPW), a leading China-based international logistics provider, is pleased to announce that its 70 percent owned subsidiary, Grand Power Logistics Development Co. Ltd ("GPLD"), has received approval to set up a Wholly Owned Foreign Enterprise ("WOFE") in China to facilitate development of the Yangshan International Container Transit Logistics Park.

Further to previous press releases, GPLD, has signed a memorandum of understanding with the Shengsi County People's Government to develop the Yangshan International Container Logistics Park. Grand Power intends to fund the development by raising debt and equity at the GPLD subsidiary level, with none of the financing or dilution expected at the public company level.

Establishment of a WOFE is one of the most important steps in allowing a 100% owned foreign company to operate efficiently and effectively inside China. A WOFE allows foreign companies full independence and freedom to implement the parent companies strategies, without having to consider the involvement of a Chinese partner, which has traditionally been the preferred strategy for expansion into China. It also allows the capability of converting RMB profits to US dollars for remittance to its parent company outside of China, which local Chinese companies are restricted from doing. GPLD needed to receive the Shengsi County People's Government approval before it could register the WOFE, and needs a WOFE to purchase the land needed for the project. Grand Power expects the registration of the WOFE to be completed within two months.

The initial registered capital of the WOFE will be US$15 million, with the total investment being US$45 million. GPLD expects the total registered capital at completion of the project to be US$120 million and the total investment to be US$360 million (or approximately RMB 2.4 billion).

"We are very excited to be taking the next step toward the development of the Yangshan Park" said Ricky Chiu, President and CEO, Grand Power Logistics Inc. "It is very difficult to obtain approval to register a WOFE in China and this will allow Grand Power the flexibility and control needed to operate such a significant project. It is also the platform that will allow us to successfully move into the next stages of development."

GPLD is currently owned 70% by Grand Power, with the balanced owned by a group of private investors, including Ricky Chiu, Grand Power's President and CEO.

About Yangshan Deep-Sea Port:

Located 26 kilometers off of Shanghai's southern coast, China's leaders consider the Yangshan Deep-Sea port project very important in Shanghai's bid to become a dominant shipping logistics centre and global economic player. When the port is fully developed in 2020, it will be lined with over 50 berths capable of accommodating up to 15 million twenty foot equivalent containers. The entire project will be completed in four phases at a total estimated cost of US$12 to $18 billion. Phases 1 and 2 have already been completed, including the Donghai Bridge which, at 32.5 kilometers and six lanes, is the second longest cross Sea Bridge in the world. The goal of the Port is to ultimately become the biggest international shipping hub in the world, facilitating China's ever growing trade with an internationally competitive and state of the art facility.

About Grand Power Logistics Group Inc.

Grand Power Logistics Group Inc. operates principally through its wholly owned Hong Kong based subsidiary, Grand Power Express International Limited (GP Express) and provides air-freight forwarding and sea-freight services, customs brokerage, logistics, warehousing and distribution, as well as other value added services. GP Express has established operations in various regions, particularly in the Greater Pearl River Delta (GPRD), China's largest economic region. GP Express' Subsidiaries or Branch Offices in this region are located in Macau, Shenzhen, Guangzhou and Jiangmen. GP Express also operates in other regions through Subsidiaries and Branch Offices or Supporting Offices in Shanghai, Taipei, Bangkok and Los Angeles. For more information visit: www.grandpowerlogistics.com.

Forward-looking Information

Statements included in this press release that are not historical facts may be considered "forward looking statements". All estimates and statements that describe the Company's objectives, goals or future plans are forward looking statements. Forward-looking statements involve inherent risks and uncertainties where actual results could differ materially from those currently anticipated.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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