December 2011: China New Energy looks to enter the niche business of supplying liquid active yeast directly to ethanol producers to help them improve their yields.

Full Text: China New Energy Limited (AIM: CNEL), the engineering and technology solutions provider to the bioenergy sector, announces that it has signed a Letter of Intent with Guangzhou Zhongke Tianyuan Regeneration Resources Engineering Co. Ltd ("GZTY Regeneration Resources") to acquire 88.5% of the legal and beneficial interests of Bengbu Boltech Bio-technology Co., Ltd ("Boltech" or "Target Company").

Boltech produces and sells active yeast, which is specifically formulated for use in the process of ethanol production, as well as yeast extracts. Highlights include: · Subject to due diligence CNE will pay RMB 13 million for 88.5% of the legal and beneficial rights of Boltech · The majority purchase is considered to be a Related Party Transaction and the consideration is to be satisfied with a mixture of cash and newly issued shares in CNE · Boltech is in involved in the production and sale of liquid active yeast, specifically formulated for use in the process of ethanol production ·

Liquid active yeast will help ethanol producers provide a superior product at reduced costs · Since beginning commercial production in July 2011, Boltech has secured annual supply contracts worth RMB 22.4 million; Boltech can help CNE generate recurring income with high margins · CNE intends to build further active yeast production facilities adjacent to large scale ethanol production plants and supply fresh liquid active yeast directly to the production plants - becoming the first company of its kind in China. More