Capital Alliance Group Inc. (the “Company or CAG”) is pleased to announce its corporate re-organization plan designed to unlock shareholder value through the simplification of the Company’s corporate structure. This process will reposition the company with the sole focus of serving the Chinese education market.
CAG is currently comprised of:
( i) a 78% ownership share in CIBT School of Business and Technology Corp. (“CIBT”), a leading Chinese education company;
(ii) Irix Design Group Inc, a media and communications company; and
(iii) Black Gardenia Inc., a media and Internet job search company.
As China continues to experience significant growth and its government and citizens increasingly focus on education, the Company has decided to focus its efforts on this market, with CIBT well positioned to exploit the Chinese education market given its track record of success and credibility built over a decade of operating in China .
After extensive review and discussion with investment professionals in the United States and Canada , as well as with strategic and significant shareholders of the Company and professional advisor’s of both CAG and CIBT, management has proposed the following re-organization plan to its Board of Directors:
1) The Company will, through an exempt take over bid, make an offer to all CIBT minority shareholders to acquire all issued and outstanding shares of CIBT. The payment under the offer will consist solely of CAG shares, the specific ratio yet to be determined. If the offer is accepted by the holders of at least 90% of the CIBT shares not already held by CAG , CIBT will become a wholly owned subsidiary of CAG.
2) CAG will combine with CIBT to form one entity, and change its name to CIBT Education Group Inc. (hereinafter “CIBT Group”).
3) The Company will sell-off all non-education related holdings over time so that the post combined entity will become a “pure-play” education venture with a sole focus on China ‘s education sector.
4) All existing corporate finance activities with BMO Capital Markets Corp of New York will continue to proceed as planned.
5) Upon successful completion of planned corporate finance activities, CIBT Group (the post re-organization entity) will be well positioned to seek other senior exchange listings and to expand its market presence into the United States through our working relationship with our investment bankers.
The objective of this corporate re-organization is for Capital Alliance to unlock value CIBT has created over the years in China ‘s booming economy while providing CIBT shareholders a form of liquidity by receiving CAG shares. Currently, CIBT is a private entity owned by CAG and investors do not have the ability to invest directly into CIBT other than through the parent company. This corporate re-organization will provide investors who are seeking investment opportunities in a company with a focus on China ‘s education sector the ability to buy shares from the open market. In addition to unlocking shareholder value, directing all potential investors to one entity instead of two will also streamline operating costs for both companies by eliminating one level of corporate ownership. Additionally, the reorganization will result in greater management focus and allow the company to utilize its resources more efficiently.
Subject to receiving formal approval from the Board of Directors of CAG and CIBT, the Company plans to commence this re-organization and several other corporate finance related activities immediately. Further details will be available in upcoming Company announcements to follow shortly. We thank our shareholders for their support over the years and we look forward to executing this exciting initiative in early 2007.
CAG also reports that the current normal course issuer bid has been suspended.
Capital Alliance Group Inc.
“Toby Chu ”
President & C.E.O.
Investor Relations Contact: Mr. James Neil * N. America Toll Free: 1-888-865-0901 Ext.322 * Email: email@example.com
WARNING : This news release contains forward-looking information. The reader is cautioned that assumptions used in preparing such information, although considered accurate at the time of preparation, may prove incorrect. The actual results achieved may vary materially from the information provided herein. Consequently, there is no representation by the company that actual results achieved will be the same as those forecast.
THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS NEWS RELEASE. THIS NEWS RELEASE SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SECURITIES IN ANY JURISDICTION