China Green Energy Industries, Inc. (OTC:CGRE) today announced it has acquired the NICONIA LEV brand and retail sales network. The NICONIA brand is owned by Changzhou Benshen Bicycle Co., Ltd. Benshen is a manufacturer of light-weight electric vehicles with a sales network of approximately 350 retail stores in China. The total purchase price for the NICONIA brand and retail sales network was approximately $3.0 million.Mr. Jianliang Shi, Chairman and Chief Executive Officer, commented, "We are very excited about the purchase of NICONIA, a quality brand in China with over 200,000 LEV sold annually, and projected sales of more than $45 million in 2011. We entered the LEV market in 2008 and have experienced strong demand in this product category. LEV sales in China have grown at a 29% compound annual growth rate from 2005 -- 2009 and our acquisition of NICONIA is a key milestone in enabling us to accelerate growth in this segment. We expect to generate attractive gross margins from the NICONIA branded LEVs of approximately 25%, while at the same time leveraging our current production capacity to achieve economies of scale."
Mr. Shi concluded, "This acquisition significantly alters our product mix, with revenue from LEV sales expected to comprise 54% of our overall revenue in 2011 versus 1% of our revenue in 2009. China is one of the largest consumers of LEVs in the world and we look forward to becoming a recognized leader in this highly fragmented industry."
China Green Energy Industries is a manufacturer and distributor of high tech and environmentally-friendly consumer products. The company has three main product lines: light weight electric vehicles (LEV), cryogen-free refrigerators, and network/HDMI cables.
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