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Precious Woods Holding Ltd.

EANS-Adhoc: Precious Woods Holding Ltd. /

  ad-hoc disclosure transmitted by euro adhoc with the aim of a Europe-wide
  distribution. The issuer is solely responsible for the content of this
  announcement.
Company Information
01.10.2010
Message to our shareholders/Press release
Supportive measures to increase operational resultsefficiency through
bridge financing and an improvement in our the ability to access the 
capital market
Precious Woods is investing in a far-reaching restructuring of the 
company in order to achieve satisfactory operational results as 
quickly as possible. As indicated previously in the reporting for the
first half year of 2010, these changes are taking longer than 
planned. In this regard, external forces suchfactors like the 
political and legal complexities in Brazil and Gabon also play a 
role. The path taken since the middle of 2009 towards achieving 
increases in operational efficiencyproductivity along with improved 
market and customer orientation has been judged to be promising by 
the Board of Directors and by Management. For 2011 we efforts will be
made are striving to achieve a significant improvement in our the 
operating result so break-even we can be reached break-even as 
quickly as possible.
As it continues on this path, Precious Woods remains committed to its
high ecological and socially responsible targets (FSC certification).
Investments are being planned carefully and being made in a targeted 
way, for example in the new sawmill in Bambidie (Gabon) for the 
processing of valuable hardwoods - a reaction to the ban on the 
export of logs abruptly imposed by the government there.
Bridge financing The protracted implementation of the measures 
introduced has led the Board of Directors to improve the liquidity of
the Group by means of two loans from current shareholders in the 
amounts of CHF 2 million and CHF 5 million. Both loans, which run for
four years, are based on the same conditions: they have an interest 
rate of 6.25% and can be converted into Precious Woods shares within 
the scope of a capital increase. The Board of Directors is very 
grateful to both lenders for their commitment.
Improvement in our ability to access the capital market Looking ahead
to the turnaround that is in progress as well as the strategic 
development of the Precious Woods Group and the related investments 
in the foreseeable future, the Board of Directors has also decided to
propose a capital increase whereby the subscription rights of all 
shareholders will be ensured. Due to legal and statutory regulations,
an increase in the capital of the company is possible only if the 
issue price of new shares is at least the same as their nominal 
value. The nominal value of a Precious Woods share is currently CHF 
50.00; the price on the stock market is fluctuating in the 
neighbourhood of CHF 30.00. Under these requirements, it is therefore
at present not possible for Precious Woods to issue new shares. 
Therefore, the nominal value must be reduced enough so it drops to a 
level below the stock market price. In that way, the company's 
ability to access the capital market will be ensured. The reduction 
in the nominal value of the Precious Woods share also enables our the
lenders to convert both of the aforementioned loans at a fixed 
conversion price of CHF 35.00 once the reduction in the nominal value
is recorded in the commercial register. A reduction in the nominal 
value has no effect on the intrinsic value of the company because the
reduction amount is being allocated to the reserves. This measure 
gives Precious Woods the necessary flexibility to carry out a capital
increase under favourable market conditions while also ensuring the 
subscription rights of the current shareholders.
The Board of Directors will call an Extraordinary General Meeting in 
the near future due time (bitte überprüfen ob korrekt) to allow for a
vote and a discussion and a vote on this reduction in the nominal 
value in relation the context of to the strategic orientation of the 
company.
For more information please contact:
* Ernst A. Brugger, Chairman of the Board of Directors (contact:   )
* Cornelia Gehrig, CFO (contact:   )
Precious Woods Holding AG, Corporate Communications Tel.: +41 44 245 
81 20, Fax: +41 44 245 81 12,  media@preciouswoods.com
end of announcement                               euro adhoc

Further inquiry note:

Precious Woods Holding Ltd.
Militärstrasse 90
CH-8021 Zürich

Branche: Forestry & Timber
ISIN: CH0013283368
WKN: 982280
Index: SPI
Börsen: SIX Swiss Exchange / Main Standard

Weitere Storys: Precious Woods Holding Ltd.
Weitere Storys: Precious Woods Holding Ltd.