Nov. 26, 2007 - Chinese linerboard producer Guilin Paper said that it has entered into a non-binding letter of intent to acquire Feitao Paper Product Ltd. Guilin said it intends to acquire all of the outstanding capital stock of Feitao in a cash and stock transaction.

The final terms of the deal will be determined pending the outcome of the financial audit of Feitao, Guilin said.

Feitao, located in Guangxi province of China, produces Kraft linerboard, white top linerboard and high performance corrugating medium and coated duplex board. The company has an annual production capacity of 13,000 tons.

In 2006, the unaudited annual revenue and net profit for Feitao were approximately US$5 million and US$430,000 respectively, Guilin added.

Guilin Paper is located in Lipu County, Guangxi Province, China, and employes about 700 workers.

SOURCE: Guilin Paper Inc.