China Water and Drinks has completed a private placement with investors led by Pinnacle China Fund.

The company said yesterday (7 June), that the US$30m private placement issued an aggregate of 45m shares of series A convertible preferred stock. These are automatically convertible into an aggregate of 22.4m shares of China Water's common stock, with the price for each share at $1.34 per share, the company said.

China Water CEO Xing Hua Chen said: "This financing is an important achievement for China Water. We are very pleased to have attracted new, high profile investors into the company and look forward to a continued, productive relationship. Management believes that we are in a position to achieve approximately $14m in revenue for the second quarter of 2007, an approximate increase of 57% from the second quarter of 2006. We believe that
the projected results for the second quarter will align with our growth targets for the full 2007 fiscal year."

In 2006, the bottled water producer reported a revenue of $35.7m and net income of $8.8m, compared to $27.7m and $7.0m for the same time the previous year due to growth in the Chinese bottled water market, according to the company.

China Water and Drinks has production facilities in Guangdong, Zhangjiang, Fexian and Changchun and produces bottled waters ranging from 350ml to 18.9 litres for beverage brands including Coca-Cola and Uni-President. The company also produces and distributes bottled water under its own brand name in 11 Chinese provinces.