Jingwei International Limited Announces Intent to Go Private for $2.20 per Share

Jingwei International Limited

today announced its intent to accept a "going private" proposal proposed by Mr. George (Jianguo) Du, Chairman and CEO of the Company, and cease its public company status. A special committee of the company's board of directors, comprised of independent directors, has recommended, and the board of directors has approved, plans to voluntarilty delist the common shares from the NASDAQ Global Market and cease the registration of the Company's common shares with the Securities and Exchange Commission under the Securities Exchange Act of 1934. In order to ensure that it will be eligible to deregister its common shares, in accordance with SEC rules and regulations, Jingwei will reduce its number of record shareholders to below 300. To accomplish this, the special committee of the board recommended, and the board of directors approved, an amendment to the Company's articles of incorporation to effect a 1-for-20,000 reverse stock split whereby each 20,000 outstanding shares of Jingwei common shares will be converted into one whole share and, in lieu of us issuing fractional shares to shareholders owning less than 20,000 pre-reverse stock split shares, Jingwei will pay cash equal to $2.20 multiplied by the number of pre-reverse stock split shares held by such shareholder. Immediately following the reverse stock split, the Company will file a second amendment to its articles of incorporation to effect a 20,000-for-1 forward stock split. As a result, shareholders owning 20,000 or more common shares at the time of the reverse split will retain their current numbers of common shares without change and not receive cash in the transaction. The funding for the cash payment for the fractional shares described above will be provided by the company's largest shareholder, George (Jianguo) Du, Chairman and CEO of the Company. Following the funding of the amount required to cash-out fractional shares and in consideration of Mr. Du assuming Jingwei's obligation to cash-out fractional shares, Jingwei will issue Mr. Du a number of common shares equal to the amount he funded divided by $2.20 (rounded to the nearest whole share). Jingwei's board of directors decided to pursue taking the Company private after concluding that the disadvantages of remaining an SEC-reporting company, including the costs associated with ongoing regulatory requirements, outweighed the benefits of public company status to the Company and its shareholders. American Appraisal China Limited, independent financial advisor to the special committee, provided an opinion to the Special Committee that the $2.20 per share cash-out price in lieu of fractional shares is fair from a financial point of view to those shareholders who would be cashed out in the proposed transaction.