Origin Agritech Limited (SEED) Establishes Second State-of-the-Art Seed Production Center, Expanding Western Channels and Doubling Seed Production Capacity
5/17/2011 10:01:38 AM
BEIJING--(BUSINESS WIRE)--Origin Agritech Limited (NASDAQ: SEED) (“Origin” or the “Company”), a vertically–integrated supplier of hybrid and genetically-modified crop seeds, announces plans to establish a joint venture company in Xinjiang for seed production and distribution. The venture will be with a prominent local, state-owned partner, Xinjiang Jinbo Seed. Facing increased demand for certain seed varieties, the company expects to spend up to US$ 15 million in investment for a 51.0% ownership stake to build an additional state-of-the-art center to produce, process, package, and sell high quality seed products for the domestic China market. With the completion of new facility, Origin will double the seed conditioning and production capacity. Furthermore, the joint venture will open up marketing channels to distribute Origin hybrid products to the northwest region in China. These additional sales are incremental to Origin’s existing sales while possessing the same gross margins. Origin will possess the exclusive joint venture partnership with this local partner in Xinjiang.