SOURCE: Providential Holdings, Inc.

January 16, 2007 13:30 ET

Providential Holdings Signs Definitive Agreement to Take Nanjing Rhine Pharmaceutical Technology Public in the U.S.

LOS ANGELES, CA and NANJING, CHINA -- (MARKET WIRE) -- January 16, 2007 -- Providential Holdings, Inc. (OTCBB: PRVH) (German Stock Exchanges: PR7, WKN 935160), a provider of international advisory services specializing in mergers and acquisitions, announced today a definitive agreement with Nanjing Rhine Pharmaceutical Technology, Inc. (Rhine) to help take the company public in the United States. Providential will also arrange $5 million to $10 million in financing to expand Rhine's production facilities. In exchange, Providential will receive stock and/or cash from Rhine (

Chairman and CEO Henry Fahman said, "We initiated a contract with Rhine in November, and now that agreement has been finalized. Rhine is extremely well positioned to benefit from its business relationships with Merck and other major Western pharmaceutical companies facilitated by a strong global network of strategic distribution channels. The management team is particularly strong with a wide range of pharmaceutical expertise and strong educational backgrounds including a number of Ph.D.s and qualified engineers. Going public in the United States will provide the company with access to capital to fund expansion and will provide investors with an excellent opportunity to participate in China's rapidly growing pharmaceutical industry."

Rhine's projected sales profit margins in 2007 are placed at over 50%, and when restated for R&D costs that are expensed, the past profit margins are in line with these projections. The company, which is profitable and expects to post revenue of approximately $1.6 million in 2006, is debt free and shows a small capital surplus on its balance sheet.

Shirley Zhu, Rhine's CEO, said, "With an infusion of capital to expand our production capacity, we expect net revenue to exceed $20 million and could potentially triple to more than $60 million by 2008. We are grateful to have assistance from Providential Holdings."

In other news, Providential Holdings announced that it is no longer pursuing the acquisition of Grocer Enterprise. Providential had signed a letter of intent to purchase Grocer in early December.

About Nanjing Rhine

Rhine is a leader in the synthesis of high purity compounds for the biotechnology and pharmaceutical industry. Rhine has nine patents -- six Chinese and three international. The company is located in Nanjing's High Technology Industrial Development Zone in the province of Jiangsu, China. This area is China's premier biotech/pharmaceutical cluster. With emphasis on pharmaceutical synthesis including design, discovery and development of intermediary medical goods, Rhine has extensive back orders from major firms in the U.S., United Kingdom, EU, and China. Merck has been one of Rhine's frequent buyers.

About Providential Holdings, Inc.

Providential Holdings and its subsidiaries engage in a number of diverse business activities, the most important of which are M&A advisory services and independent energy. The company acquires and consolidates special opportunities in selective high-growth industries to create additional value, acts as an incubator for emerging companies and technologies, and provides financial consultancy and M&A advisory services to U.S. and foreign companies. For more information on Providential Holdings and its subsidiaries, visit As part of its activities in Vietnam, Providential has been hosting seminars in conjunction with the Nasdaq Stock Market, the Vietnamese Chamber of Commerce and Industry and a leading U.S. investment-banking firm to help Vietnamese companies go public and raise capital through the U.S. financial markets.

A profile for investors can be accessed at

For investor relations questions regarding Providential, contact Frank Hawkins or Julie Marshall, Hawk Associates, at (305) 451-1888, e-mail:, or visit or

Safe Harbor: This news release contains forward-looking statements that are subject to certain risks and uncertainties that may cause actual results to differ materially from those projected on the basis of such forward-looking statements. Such forward-looking statements are made based upon management's beliefs, as well as assumptions made by, and information currently available to, management pursuant to the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995.

Contact Information

  • Investor Relations Contact:
    Hawk Associates, Inc.
    Frank N. Hawkins, Jr. or Julie Marshall
    Phone: (305) 451-1888
    Email: Email Contact