BVI Company Financial News

Evergreen Pulp mill, which was sold by its HK-based owner Lee & Man Paper Manufacturing to a British Virgin Islands corporation, is still not turned around. The new difficulties for the mill, which has been shut down since mid-October, were caused by the regulators, which informed about their intent to revoke the water quality permit.

Last week, the North Coast Regional Water Quality Control Board issued a notice to revoke Evergreen’s waste discharge requirements, necessary for the mill to operate.  The new permit that can be issued by the board will be much stricter, while even the current guidelines could not be successfully met by the company. For the period 2005 to 2007 Evergreen owes $463,000 in fines, and violations of 2008 can make $500,000 or even more. The water board can transfer a permit to a new owner, but water resources control engineer considers it does not make sense as the mill cannot comply with it.

With stricter rules that would apply in the new permit, it is even less likely the mill could come into compliance. A secondary treatment of the wastewater that could be necessary can cost $15 million to $20 million, and that would give buyers a reason to pause, as the mill itself may not currently be worth such amount.

After the two subsidiaries that owned Evergreen were sold to a BVI company, the regional board was notified of facility’s sale to ACE Mills Inc. in December. But the board has not heard from ACE Mills or Evergreen since that time, so it is unknown if this company refused from the purchase of Evergreen at the last minute.

The matter will be heard on March 12. Evergreen in still listed as incorporated in Colorado, its CEO David Tsang has not returned calls or e-mail inquiries.

The holding corporation S3 Investment Company, Inc. and its wholly owned Redwood Capital subsidiary that now trades in the U.S. as Energroup Holdings Corporation , assisting private Chinese companies in accessing the U.S. capital markets through reverse mergers into public companies, on October 15 has informed shareholders on the updated status of financial filings originally planned to be filed by S3 this week, and of the expected timeline for closing of Redwood Capital’s reverse merger transaction. After filing the documents which will include the annual reports with audited financials for the 2007 and 2008 fiscal years, the company will apply to be reinstated to the Over-the-Counter Bulletin Board market.

Chairman and CEO of S3 Investment Company, Jim Bickel, also commented on the status of Redwood Capital reverse merger transactions, saying that they are expecting for two of the transactions to close by the end of the calendar year.

Redwood Capital participated in a transaction involving BVI-controlled Dalian Chuming: Nevada-based Energroup Holdings had acquired all of the issued and outstanding capital stock of Precious Sheen Investments Limited, a British Virgin Islands corporation which is the whole owner of China-based Dalian Chuming. Redwood Capital was issued 428,095 shares of ENHD as the equity portion of its payment for advisory services provided for the transaction.

In the recent financial reports for Energroup Holdings Corporation, it is seen that through its direct and indirect subsidiaries (known as Chuming), supermarket and franchise stores increased sales 57.8% up for the first six months of 2008 versus prior year, and net income increased 70% to $9.9 million for the 6 months ended June 30, 2008.