SOURCE: Pansoft Company Limited

December 06, 2010 10:01 ET

Pansoft Completes Acquisition of 55% Equity Stake in Shandong HongAo Power Technology Co., Ltd.

JINAN, CHINA--(Marketwire - December 6, 2010) - Pansoft Company Limited (NASDAQ: PSOF) ("Pansoft" or the "Company"), a leading ERP software service provider for the oil and gas industry in China, today announced that it has completed the acquisition of a 55% equity stake in Shandong HongAo Power Technology Co., Ltd. ("HongAo Power"), which was previously announced on April 26, 2010. The purchase price was approximately $2.6 million in cash, and Pansoft has finalized the business registration for the new business.

HongAo Power is a comprehensive technology solution and service provider focused on energy-saving and pollution-reduction solutions for the thermal power generation industry in China. It has developed over seven proprietary solutions in the area of reducing coal consumption, including a system for the optimization of thermal power generating performance, among others. Pansoft's investment in HongAo will be used to develop new technology in order to extend HongAo's lead over its competitors. HongAo has approximately 40 customers in China, primarily thermal power plants in Shandong province, which is one of the large thermal power generation bases in northern China. The investment in HongAo will also be used to establish new sales channels in other provinces. Thermal power represents approximately 80% of overall power generation capacity and is one of the fastest growing segments in the power generation business in China. HongAo continues to expect to record revenue and net profit of approximately $7 million and $1.3 million, respectively, during Pansoft's 2011 fiscal year, as announced on April 26, 2010.

"Our investment provides Pansoft access to HongAo's base of thermal power customers and relationships. The completion of acquisition of the stake in HongAo is in line with our acquisition strategy to expand our ERP business into energy and power generation market as an integrated solution and service provider," said Hugh Wang, Chairman of Board. "We expect to achieve a smooth operational integration and look forward to a positive contribution to Pansoft's margins and profitability."

About Pansoft Company Limited

Pansoft is a leading enterprise resource planning ("ERP") software and professional services provider for the oil and gas industry in China. Its ERP software offers comprehensive solutions in various business operations including accounting, order processing, delivery, invoicing, and inventory control and customer relationship management. For more information, visit http://www.pansoft.com.

About HongAo Power Technology Co., Ltd.

HongAo Power is a leading IT based energy-saving and pollution-reducing solution and service provider for power works. They possess over seven mature solutions, including five software copyrights and five patents. They have approximately 40 customers in China, most of which are thermal power plants in the Shandong Province, one of the large thermal power generation bases in northern China. HongAo Power's technologies are also expandable to other areas.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

This press release contains forward-looking statements concerning Pansoft Company Limited, which include but are not limited to, statements regarding Pansoft's acquisition strategies, timing of development projects and efforts to achieve business growth, improvement on profit margin and anticipated revenue growth. The actual results may differ materially depending on a number of risk factors including but not limited to, the following: general economic and business conditions, development, shipment and market acceptance of products, additional competition from existing and new competitors, changes in technology or product techniques, and various other factors beyond its control. All forward-looking statements are expressly qualified in their entirety by this Cautionary Statement and the risk factors detailed in the Company's reports filed with the Securities and Exchange Commission. Pansoft Company Limited undertakes no duty to revise or update any forward-looking statements to reflect events or circumstances after the date of this release.

Contact Information

  • Company Contact:
    Pansoft Company Limited
    Allen Zhang
    Chief Financial Officer
    Phone: +86-531-8887-1159
    E-mail: allen.zhang@pansoft.com

    Investor Contact:
    CCG Investor Relations
    Mr. John Harmon, CFA
    Sr. Account Manager
    Phone: +86-10-6561-6886 Ext. 807 (Beijing)
    E-mail: john.harmon@ccgir.com
    Mr. Bryan Blake
    Market Intelligence Executive
    Phone: +1-646-833-3416 (New York)
    E-mail: bryan.blake@ccgir.com