CASIL Successfully Acquires Shenzhen RayiTEK

Endeavors to Develop Polyimide New Materials Business

HONG KONG, July 11, 2011 /PRNewswire-Asia/ -- China Aerospace International Holdings Limited ("CASIL" or the "Company"; HKSE stock code: 31) today announced that its wholly-owned subsidiary, CASIL New Century Technology Development (Shenzhen) Company Limited ("New Century"), has successfully acquired a 55% stake in Shenzhen RayiTEK Hi-Tech Film Company Ltd., ("Shenzhen RayiTEK ") at a consideration of RMB63,040,000 through means of winning an open tender from Qingdao Property Rights Exchange and entering into different share transfer agreements. As per the conditions listed in the open tender, New Century will advance a sum of RMB100,000,000 to Shenzhen RayiTEK and serve as its guarantor to secure a bank loan of RMB60,000,000.

Since its establishment in 2004, Shenzhen RayiTEK has been committed to the research and development of polyimide new materials. Polyimide is a special type of polymer new material that has proved to be an indispensable key material in developing microelectronics technology, attributable to its excellent performance in terms of integrated extreme-heat-resistance and insulation resistance. In fact, polyimide, as a special industrial material, has already been widely adopted in aviation, aerospace, microelectronics, nanotechnology, liquid crystal display technology, separator material technology and laser technology etc.

To promote its new business development strategy, the Company has acquired Shenzhen RayiTEK, which is a high-tech company specializes in research, manufacture and market new materials. At present, Shenzhen RayiTEK has established an annual production capacity of approximately 300 tons for high-performance polyimide materials, with an annual output value amounting to approximately RMB200 million. In early 2011, Shenzhen RayiTEK's production technology was honored as the "State's High-tech Industrial Demonstrative Project" by the China National Development and Reform Commission. Shenzhen RayiTEK has obtained the ISO9001 Quality Management System certification, ISO14000 Environment Management certification and ISO18000 Occupational Health and Safety Management certification issued by SGS, a UK verification and certification organization. Furthermore, the Company's polyimide film products have also been accredited by the UL laboratory Safety Materials Verification and the EU RoHS Environmental Materials Testing.

Mr. Li Honqjun, Executive Director and President of CASIL, commented: "With the support of our major shareholder, China Aerospace Science and Technology Corporation (CASC), the Company, through the acquisition of Shenzhen RayiTEK, has made the first step in expanding into the polymer new materials business. Shenzhen RayiTEK's business is expected to grow rapidly during the next few years and to become one of our driving forces by means of competitiveness and profitability. The acquisition is also expected to generate synergy for the Company's hi-tech manufacturing business."

Upon the completion of the transaction, Shenzhen RayiTEK will serve as the developmental platform for the Company's polyimide business and will further explore other avenues for the development of this business, including the possibility of mergers and acquisitions both domestically and overseas.

New materials business is one of the core sectors of CASC's aerospace technology applications business. Leveraging on China robustly promoting the seven strategic industries as part of its twelfthfive-year plan and CASC striving for opportunities to further drive the aerospace technology applications business, CASIL has initiated prudent maneuvers with regard to its business development. While rolling out its aerospace services business, the Company is planning to utilize the penetration into the polyimide business as a point of entry, and to invest significant resources into the development of this promising new materials business. 

Moreover, polyimide film, the critical insulating material for power and electrical appliances, is widely used in the manufacturing of transmission and distribution equipment, wind power generation equipment, variable frequency motors, high-speed traction motors and high-voltage transformers etc. Since the 1990s, high-performance polyimide film materials have also become critical microelectronics manufacturing and packaged materials, and are widely used in areas such as VLSI manufacturing, flexible packaging substrates and flexible cable connectors.

With the rapid growth of the strategic industries, such as new-generation information technology, energy-saving and environmentally friendly technologies, high-end equipment manufacturing, advanced materials, and alternative-fuel vehicles etc. during the twelfthfive-year plan period in China, brand-new applications of polyimide new materials are expected to be introduced in more diversified fields. Some examples include the application of transparent polyimide films for new flexible photovoltaic products and flexible display products, and the adoption of microporous polymeric films as innovative diaphragm materials for high-capacity lithium battery-powered vehicles. Thus, it is expected that there will be enormous room for the market development of the polyimide new materials business in future.

About China Aerospace International Holdings Limited

China Aerospace International Holdings Limited (CASIL) is a public-listed company (stock code: 31) of China Aerospace Science & Technology Corporation (CASC) in Hong Kong. CASIL engages in hi-tech manufacturing business and strives to actively expand its business in aerospace services, such as the Aerospace Science & Technology Plaza in Shenzhen and the Complex Zone of the Launching Site in Hainan Province in the recent years.

Website: http://www.casil-group.com/

About China Aerospace Science & Technology Corporation

Being CASIL's major shareholder, CASC is a sizeable state-owned enterprise group directly managed by State-owned Assets Supervision and Administration Commission of the State Council (SASAC).  CASC is mainly engaged in the research, design, manufacture and launch of space systems such as launch vehicles, satellites and manned spaceships, and also provides international commercial satellite launch service. By virtue of space technology, CASC pays great attention to product development in such areas as satellite applications, information technology, new materials and regenerative energy, special space technology applications, special vehicles and auto parts, and space biology. At present, CASC is constructing a new aerospace industrial system to accelerate the development of its businesses, including aerospace technology applications and aerospace services.

Website: http://www.spacechina.com/

About Shenzhen RayiTEK Hi-Tech Film Company Ltd.

Shenzhen RayiTEK Hi-Tech Film Company Ltd. (Shenzhen RayiTEK), a joint venture established in China, is a high-tech company that engages in the research, manufacture and market of polyimide and related composite materials.

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