Chinatel Closes Us$640 Million In Equity Investments At $3 Per Share

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10th February 2010, 02:00am - Views: 706





Business Finance ChinaTel Group, Inc. 1 image

Business Finance ChinaTel Group, Inc. 2 image










MEDIA RELEASE PR38249


ChinaTel Closes US$640 Million in Equity Investments at $3 Per Share


IRVINE, Calif., Feb. 9 /PRNewswire-AsiaNet/ --


    ChinaTel Group, Inc. (ChinaTel) (OTC Bulletin Board: CHTL), a leader in

high speed wireless broadband and telecommunications infrastructure

engineering and construction services, today announced it has signed and

received the first combined installments of two stock purchase agreements

calling for a total investment of $640 million into the company. The combined

investment represents 48% of the total outstanding shares, valuing ChinaTel

in excess of $1.33 billion.


    The investors have each made initial payments called for under their

respective contracts. By March 1, 2010, ChinaTel will have received $241

million, and the balance of $399 million by June 1, 2010. Proceeds from the

contracts will primarily be used to expand and deploy wireless broadband

networks worldwide in addition to repaying existing financing notes. Full

details of the transactions are available on Form 8-K filed with SEC at



    ChinaTel's CEO, George Alvarez, stated, "With this infusion of capital,

we can pursue our global expansion plans, and accelerate the deployment of

the Chinacomm network in the Peoples Republic of China (PRC). We expect to

complete build-out of the first twelve PRC cities by June, 2011. When

completed, the Chinacomm network will be one of the largest wireless

broadband networks in the world."


    The investment partners are Excel Era Limited (Excel), a Hong Kong-based

investment group, and Isaac Organization, Inc. (Isaac), a Canadian-based

investor. Excel is investing $480 million and acquiring approximately 159.6

million new shares of ChinaTel's series A common stock to be issued, which

represents 36% of total shares issued and outstanding as of the closing date.

Isaac is investing $160 million and acquiring approximately 53.2 million

newly issued shares, which represents 12% of the total outstanding shares.

The price per share for both transactions is $3.0075.


    ChinaTel's President, Colin Tay remarked: "We have worked very hard to

execute transactions beneficial to both our shareholders and our new

institutional investors. We selected these investment partners because they

provide unique alliances that will facilitate ChinaTel's ability to penetrate

additional markets globally."


    Isaac Organization has previously served as a strategic advisor to

ChinaTel in addition to developing and managing a portfolio of assets valued

in excess of $5 billion, including significant interests in Asia. "We have

been involved with ChinaTel in an advisory capacity and are very pleased to

take a larger role with the Company. Being very familiar with the ChinaTel

story, Isaac Organization seized the opportunity to invest in the next

generation of a high-demand technology to meet the needs of rapidly emerging

markets," said Tony Isaac, CEO of Isaac Organization. "The timing was right

for this investment, and we look forward to our increased role with and the

future of ChinaTel."


Business Finance ChinaTel Group, Inc. 3 image

    In conjunction with the financing, ChinaTel is appointing Tony Isaac and

Charles Wang to its board, expanding the number of company directors from

four to six. Mr. Wang is CEO of Excel, which has a strategic presence in

numerous markets, including India, Argentina, Peru and Brazil.


    "Being asked to join the board of ChinaTel is a great honor. I look

forward to working closely with the management team and bringing my relevant

technology management and public company board experience to ChinaTel," said

Charles Wang.


    About ChinaTel Group, Inc.

    ChinaTel Group, Inc. (ChinaTel), through its controlled subsidiaries,

provides fixed telephony, conventional long distance, high-speed wireless

broadband and telecommunications infrastructure engineering and construction

services. ChinaTel is presently building, operating and deploying networks in

Asia and South America: a 3.5GHz wireless broadband system in 29 cities

across the People's Republic of China (PRC) with and for CECT-Chinacomm

Communications Co., Ltd., a PRC company that holds a license to build the

high speed wireless broadband system; and a 2.5GHz wireless broadband system

in cities across Peru with and for Perusat, S.A., a Peruvian company that

holds a license to build high speed wireless broadband systems. ChinaTel's

vision remains clear: (i) to acquire and operate wireless broadband networks

in key markets throughout the world; (ii) to deliver a new world of

communications; and (iii) to invest in building long-lasting relationships

with customers and partners to lead the broadband industry in customer

service and responsiveness. Our strategy is to build leading-edge

IP-leveraged solutions advanced by our worldwide infrastructure and

leadership in emerging markets. http://www.ChinaTelGroup.com


    About Excel Era Limited

    Excel provides creative financial solutions and funding for private

projects, humanitarian projects and individual clients in niche investment

banking and financial service environments. With over $200 billion under

management, our range of services includes (a) asset management, and (b)

project financing. Our specialty is providing multi-dimensional financing

solutions for our clients by viewing the total picture of the client's goals,

assessing not only financial requirements, but the aggregate of needs in

relation to opportunities, helping each client determine what can be done to

enhance the utilization of their assets. The range of services described

above is not offered to the public, but only upon specific request by

qualified and sophisticated investors.


    About Isaac Organization

    Isaac is a leading global private investment firm with approximately $5

billion worth of projects under management across a family of funds. Isaac

invests in companies across a broad range of geographies, including the

United States, Canada, Mainland China, Taiwan, and South Korea. Guided by a thorough

approach to due diligence execution, research and market analysis, Isaac Organization

has found one financial truth to be inviolate: growth and real wealth happens over time

and scrupulous due diligence. Isaac's various funds invest in commercial real estate

buildings leased by several agencies of the United States federal government, as well as

by hospitals and medical

clinics, and other industries including technology, telecommunications and

entertainment companies. Isaac is also involved in urban development projects

in Asia. In recent months the company has closed transactions valued at

approximately $346 million. http://www.Isaac.com.


    Safe Harbor Statement

    This press release contains forward-looking statements that involve risks

and uncertainties. Actual results, events and performances could vary

materially from those contemplated by these forward-looking statements. These

statements involve known and unknown risks and uncertainties, which may cause

the Company's actual results, expressed or implied, to differ materially from

expected results. These risks and uncertainties include, among other things,

product demand and market competition. You should independently investigate

Business Finance ChinaTel Group, Inc. 4 image

and fully understand all risks before making an investment decision.


   

Contacts:

    ChinaTel Group, Inc.

    Investor Relations

    (Toll Free) 1-877-260-9170

    investors@chinatelgroup.com


    Media:      Lewis Goldberg / +1-212-896-1216 / lgoldberg@kcsa.com



    SOURCE:  ChinaTel Group, Inc.


    CONTACT: Investor Relations: 

             +1-877-260-9170, 

             investors@chinatelgroup.com;


             Media: 

             Lewis Goldberg, 

             +1-212-896-1216, 

             lgoldberg@kcsa.com 


             both for ChinaTel Group, Inc.




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