Can you provide a link that shows the company was going to withdraw the registration? Mike Toups, in one of the virtual conferences, said the company is thinking of ways to remove the October 2012 warrants. The S-3 for the 50 Million has never been on the table. Again, where is the link to what you are talking about? Again, todays news is totally UNEXPECTED.
Longwei Petroleum Withdraws $50 Million Shelf Registration On Monday October 3, 2011, 7:00 am TAIYUAN CITY, China, Oct. 3, 2011 /PRNewswire-Asia-FirstCall/ -- Longwei Petroleum Investment Holding Ltd. (NYSE Amex: LPH) ("Longwei" or the "Company"), an energy company engaged in the storage and distribution of finished petroleum products in the People's Republic of China ("PRC"), today announced that it has filed a Post Effective Amendment (the "Amendment") to its Registration Statement on Form S-3 with the Securities and Exchange Commission (the "SEC") to deregister the $50 million shelf registration statement, which was declared effective on February 18, 2011
The shelf registration enabled Longwei to fulfill the registration-related requirements in advance for up to an additional $50 million in securities; the Amendment will deregister these securities. The Form S-3 also included the effective registration of common stock underlying warrants issued by the Company to investors associated with its October 2009 financing, as required under the terms of the financing. The withdrawal of the shelf registration does not deregister the common stock underlying these warrants.
Mr. Cai Yongjun, Chairman and CEO of Longwei, commented, "We are withdrawing the shelf registration to mitigate investor concerns regarding the issuance of securities at the current share price levels. Our operating cash flow is sufficient to fund the total RMB 700 million (approximately $108.3 million USD) purchase price for the assets of Huajie Petroleum, and our balance sheet and operating results remain strong as we head into our second fiscal quarter."
As of June 30, 2011, Longwei had paid a RMB 550 million (approximately $85.1 million USD) deposit toward the total purchase price of RMB 700 million (approximately $108.3 million USD) for the purchase of the assets of Huajie Petroleum Co., Ltd., a fuel storage depot in northern Shanxi Province with a 100,000-metric-ton storage capacity.
"We initially registered the $50 million worth of the Company's securities to accelerate the acquisition of the Huajie Petroleum assets, but when market conditions changed, the Company remained committed to the asset acquisition and funding the purchase price from cash flow generated through operations," stated Michael Toups, CFO of Longwei. "The Company has also remained steadfast in its commitment to shareholders by not issuing additional equity which may be dilutive."