3SOF

Quote from: la-onda on December 01, 2005, 02:01:43 PM

AOB is starting to be noticed by more institutional investors. The recent private placement is evidence of this. AOB raised $60 million dollars by issuing 12.5 million units at $4.80, each unit represents 1 share and 3/10 of a warrant exercisable at $6.50. A fringe benefit of this deal is that institutional investors will own approximately 22% of the company, these stronger hands may decrease the downside volatility somewhat. Going forward AOB will be flush with cash. They will have cash and cash equivalents of $71 million dollars. With 56.5 million shares outstanding after the completion of the PP, this implies cash and cash equivalents per share of $1.25. They will further increase their cash levels if and when the warrants are exercised. So far the company's strong management has been able to execute on their acquisition strategy, and have significantly increased shareholder value. They have pursued strategic acquisitions such as the purchase of a company with a national distribution network, which has allowed AOB to market their products to a huge number of consumers. The environment is China is such that a company like AOB can buy companies at or even slightly below book value. The cash that they possess will allow them to pursue a policy of accretive acquisitions going forward.

La-onda,

Good find, thanks for posting it.

I noticed yesterday that these drops have brought out the first ever institutional investor Buy signals that I have seen yet for AOB on Lycos I watch, so I agree with the above sentiment. 

http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=AOB&range=30&mgp=0&hdate=&x=9&y=12

As you can see, its only recently this started when the price dropped. 

it will hit this trendline i think....so a good entry is around 4.00 +/-

another summarization:
Full Transcript of the Prepared Remarks From American Oriental Bioengineering's Q3 Conference Call (AOB)

Here's the full text of the prepared remarks from American Oriental Bioengineering's (ticker: AOB) Q3 conference call:

    American Oriental Bioengineering, Inc.
    Third Quarter 2005 Earnings Conference Call
    November 14, 2005

    Operator: Good afternoon, ladies and gentlemen, and welcome to the American Oriental Bioengineering Third Quarter 2005 Earnings Conference Call. At this time, all lines have been placed on a listen-only mode for the duration of today's conference. It is now my pleasure to turn the floor over to Hayden Communications to read the introductory statement.

    Chris Donnelly: Thank you, and welcome everyone to the first earnings conference call for American Oriental Bioengineering. Today we will be discussing the 2005 Third Quarter Financial results. Today's press release announcing these results has been posted to the appropriate news wires. On the call today is Mr. Tony Liu, Chairman and CEO of AOBO, as well as Miss Lily Li, COO and acting CFO, who are both with us today. For simplicity, all percentages will be rounded to the nearest percent. Today's call will be a presentation by management and will not include a Q&A session. Given that Tony and Lily are not in the same office and that there are some language barriers, we believe that it is in the best interest of time to utilize this format. We do plan to incorporate a Q&A allocation for future quarterly calls. In addition, please feel free to contact Hayden Communications at (843) 272-4653 with any investor related questions on a go-forward basis.

    Before we get started, I'd like to read a cautionary statement about forward-looking information. The presentation may contain, in addition to historical information, forward-looking statements within the meaning of Federal Securities laws regarding American Oriental Bioengineering. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements that are other than statements of historical fact. These forwardlooking statements are based on current management expectations and are subject to risk and uncertainties that may result in expectations not being realized and may cause some actual outcomes to differ materially from expectations reflected in forward-looking statements. Potential risks and uncertainties include product and service demand acceptance, changes in technology or economic conditions, the impact of competition and pricing, the impact of government regulation, and other risks contained in statements filed from time to time with the Securities and Exchange Commission. All forward-looking statements, whether written or oral and whether made by or on behalf of the Company, are expressively qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statement. In addition, the Company disclaims any obligation to update any forward-looking statement to reflect events or circumstances after the date thereof. Because forwardlooking statements are subject to risks and uncertainties, we caution you not to place undue reliance on any forward-looking statements. Forward-looking statements made during the presentation speak only as of the date of this presentation. All written or oral forward-looking statements by AOBO or persons acting on behalf are qualified by these cautionary statements.

    With that out of the way, I'll turn the call over to Hong, who will speak on behalf of Mr. Tony Liu, Chairman and CEO. Hong?

    Hong: Before Tony Liu speaks, I would like to explain that Tony, a very experienced founder and the CEO of the Company, does not speak English. Therefore, he will speak Chinese, and I will translate or voice over to the public.

    Tony Liu (translated by Hong): Thank you, Chris, and thank you, everyone, who joined us today. It's a pleasure to present AOBO's first conference call to discuss quarterly earnings results. We believe regular conference calls to discuss quarterly earnings is an appropriate step to allow our shareholders to have greater transparency and insight into our operations here at AOBO, by hearing directly from senior management.

    2005 has been an exciting and eventful year thus far for AOBO, as a number of positive developments have unfolded. We are very proud that in the last ten years, we have grown from a start-up in 1994 with about $100,000 of revenue to become a leading manufacturer of plant-based pharmaceutical products and plant-based nutraceutical products for the rapidly growing Chinese market. We generated sales of more than $31 million during 2004 and have seen our sales increase at 46% compound annual growth rate over the last three years. We operate in a large and growing market. We estimate that the total pharmaceutical and nutraceutical market in China was approximately $62 billion in 2004. Demographic trends in this market are favorable, as the Chinese population continues to grow and age and economic expansion in China creates wealth, which serves to increase the number of citizens who can afford healthcare. With the total market for pharmaceutical products in China, herbal and plant-based pharmaceutical remedies and products have an extensive history. Many Chinese consumers and doctors rely upon the use of plant-based products for treatment of a variety of different ailments, consistent with the Eastern philosophy of health and wellness.

    Our headquarters and manufacturing facilities are located in Harbin, China, a city with a population of approximately six million, in one of four pharmaceutical corridors in China. We utilize four proprietary technologies for manufacturing products, which provide both cost and quality advantages compared to many of our competitors. We currently have more than 100 products in our portfolio, all plant-based in formulation divided into two key categories: plant-based pharmaceuticals and plant-based nutraceuticals. PBP is the larger of the Company's two divisions as a percentage of revenue. PBP products in China require approval from the state FDA and are administered both through over-the-counter locations and through prescriptions at hospitals and clinics. The two largest products in the PBP category are Shuanghuanglian Powder Injection and Cease Enuresis Soft Gel. SLPI, our largest contributing product, as a percent of total revenue is one of the only two PBP herbal injections approved by the China state FDA for treating anti-viral indications. SLPI has been approved by China state FDA for treatment – selected by China state FDA for treating SARS during the SARS outbreak, although a definitive decision of efficacy of SLPI for the treatment of SARS has not been determined. Cease Enuresis Soft Gel is approved by the China state FDA as a prescription remedy for chronic bedwetting and nighttime urination.

    PBN is the smaller of the Company's two divisions. PBN products are not licensed by the China state FDA, but they generally require local government approval and are typically sold over the counter at the retail outlets. AOBO's PBN division products soybean peptide products in powder and liquid forms. Soybean peptide is a cholesterol-free energy-boosting protein source that enhances the immune system and has anti-fatigue benefits. AOBO also produces a line of nutritional products through the PBN division, including the Three-Happiness nutritional drink, which are rich in vitamins and amino acids to enhance well-being and to provide energy The Three-Happiness product line is a recognized retail brand name in China.

    We are very proud of the success we have had in growing both our PBP and PBN businesses. For the nine-month period ended September 30 th, 2005, we reported growth in total revenues and total net income of 81% and 85%, respectively, relative to the same nine-month period in 2004. During 2005, we have considerably improved our balance sheet and have successfully integrated HSPL, the acquisition we closed in the fourth quarter of 2004, which has expanded our product line, expanded our geographic customer footprint, and enhanced our channels of distribution.

    In addition to a number of positive strategic developments achieved for the business, AOBO was listed on the American Stock Exchange, and in November we received approval for a dual listing on the Archipelago Exchange, accomplishments that we believe will enhance the Company's profile with U.S. investors. The Pacific Exchange also announced this month that AOBO options will begin trading during November 2005. We are very proud of these achievements and believe AOBO is well-positioned for the next stage of growth and profitability.

    Our continued strong performance was again the highlight for the third quarter. We achieved record quarterly revenues of $13.4 million and net income of $3.7 million, or $0.08 per weighted average full-diluted share. The Company completed the redemption of its class "A and "B" warrants related to the November 2004 private placement, which added more than $11 million in cash to our balance sheet and increased AOBO's total cash position to just over $19 million.

    In addition, we opened our first and only specialty store, Life Peptide store, as a showcase for our plant-based nutraceutical products and a means to penetrate the Hong Kong market from both a branding and a product education perspective. This is in addition to the more than 100 independent retailers or retail stores who are now actively distributing our products in the region. We are extremely enthusiastic about expanding our addressable market and product line and implications for the Company's prospects going forward.

    I'd like to ask Lily Li, our COO and Acting CFO, to reveal our quarterly and year-to-date performance in more detail, and I will follow up with some closing remarks. Lily?

    Lily Li: Thanks, Tony. For reporting purposes, all financial results are stated in U.S. dollars. For the third quarter, we reported revenue of $13.4 million, an increase of 82% compared to the 7.4 million reported for the third quarter of 2004. Excluding the revenue contribution from the HSPL acquisition completed in November of 2004, organic revenues grew 24% for the quarter compared to the third quarter of last year. Plant-based pharmaceuticals represented 8.6 million or 64% of the total revenue, an increase of 174% compared to the third quarter of 2004. Revenues were partially impacted by continued strong sales of our Shuanghuanglian Power Injection acquired from HSPL in November 2004, which contributed 4.3 million or 50% of the division revenue, and the Cease Enuresis Soft Gel product, which contributed 3 million, representing 35% of divisional revenue.

    The plant-based nutraceutical division, which is primarily our soy bean peptide product, represented 4.8 million or 35.7% of total revenue, and it was up 13% versus the comparable 2004 period. Benefiting from increased marketing and field efforts to promote the benefits of this product, our Peptide product, our largest-selling product, grew in this division and represented 3.1 million or 65% of divisional revenue.

    Total cost of goods was 4.9 million, an increase of 102% compared to the 2.4 million from the same period a year ago. Gross margin was 63% for the third quarter of 2005 compared to the gross margin of 67% for the third quarter last year. Higher costs associated with the manufacturing of HSPL product was responsible for the decrease in gross margin. Results during the third quarter 2004 did not include any contribution from HSPL.

    Total selling and marketing expenses were 850,000, up 67% from 508,000 reported for the third quarter in 2004. Advertising expenses were 757,000, up 4% compared to 729,000 in the comparable period in 2004. General and administrative expenses were 1.9 million, up 117% compared to 893,000 for the comparable period in 2004. Total operating expenses were 3.9 million, an increase of 69% compared to the 2.3 million reported for the same period last year. The increase in total expenses was related to the HSPL acquisition, as well as an increase in costs necessary to support overall growth within our operation. Total continuing operating expenses as a percentage of sales for the period was 29% compared to 31% for the comparable period in 2004.

    We reported income for operations of 4.6 million, an increase of 75% compared to the 2.7 million for the comparable period last year. Operating margins were 35% during the quarter, compared to 36% during the third quarter 2004, with the decrease due in part to the impact of the integration of HSPL operations.

    Net income was 3.7 million or $0.08 compared to net income of 2.2 million or $0.07 for the third quarter last year. This represents an increase in net income of 66%, despite a higher effective tax rate of 23% for the third quarter 2005 versus 17% during the comparable period in 2004, as well as a 34% increase in our weighted fully-diluted share count, all 44,076,235 shares used to calculate earnings per share. For the nine-month period ended September 30, 2005, we announced revenue of 35 million, an increase of 81% compared to 19.3 million reported for the first nine months of 2004. Our PBP division reported 22.1 million in revenue, up 112% compared to the comparable nine months of 2004.

    For the nine months, 10.9 million of the revenue growth was contributed by Shuanghuanglian Power Injection, or approximately 50% of the division's revenue, and our Cease Enuresis Soft Gel products contributed 7.3 million or 33% of the division's revenue, representing 53% growth compared to the yearago nine-month period 2004. Our PBN division reported revenues of 10.9 million, up 13% as compared to the comparable nine months of 2004. The Peptide product line generated 8.1 million representing 63% of this division's revenue, representing 8% growth compared to the year-ago nine-month period 2004.

    Total cost of goods were 12.7 million, an increase of 109% compared to the 6.1 million from the same period a year ago, resulting in gross margins of 64% for the nine-month period of 2005 compared to gross margin of 68% for the same period last year. Higher costs associated with manufacturing Shuanghuanglian Powder Injection contributed to the increase in cost of goods sold. Selling and the marketing expenses were 2.1 million for the nine-month period, up 34% compared to the 1.5 million for the same period last year. Advertising expenses were 2.2 million, a decrease of 8% compared to the 2.3 million. General and administrative expenses were 5 million, up 80% compared to 2.8 million. Our total operating expenses were 10.1 million, an increase of 43% compared to the 7.1 million in the prior year. Operating expenses as a percentage of sales were 28.9% compared to 36.8% during the comparable nine-month period in 2004.

    AOBO reported operating income of 12.1 million, up 99% compared to the 6.1 million in operating income for the same period last year, with operating margins increasing from 32% to 3% as the Company benefited – I'm sorry, 32% to 35%, as the Company benefited from higher yearover-year revenue and increased leverage of operations. Net income was 9.2 million compared to net income of 5 million, an increase of 85% which equated to $0.22 per fully-diluted share compared to $0.15 per fully-diluted share for the nine-month period last year.

    Turning to the balance sheet, we completed the quarter with 19.1 million in cash and cash equivalents, which includes the 11.2 million received from redemption of class "A" and "B" warrants exercises during the third quarter 2005. This compares to 11.4 million in cash as of December 31 st, 2004. The Company reported 3.7 million in bank loans compared to 5.1 million as of December 31 st, 2004. During calendar year 2005, the Company has generated 3.9 million in positive cash flow from operations, which has helped to improve overall cash position.

    Thank you. I will turn this call back to Tony for closing comments.

    Tony Liu, (translated by Hong): Thank you, Lily. As the AOBO story continues to unfold, we hope the progress we have made in growing and diversifying the business becomes more evident. We believe this is just the beginning of the AOBO story, as we build upon our momentum. We own a very recognizable brand in China with our Three-Happiness nutritional beverages and the soy protein peptide line, and we have developed and own two growing products within the PBP market, all of which will benefit from further market penetration and expansion.

    We have a clearly defined two-pronged growth strategy. We seek to grow organically by focusing on new product development and expanding the application of PBP products. This strategic component involves further penetrating existing markets, capitalizing on the favorable macrodemographic trend I spoke of, and expanding our established distribution network. We currently have more than 10,000 points of sale, and our recent move into the Hong Kong market commences a key next step to leverage our recognized brand identity for our PBN products outside of mainland China.

    We will also seek to grow through acquisition and believe we have numerous opportunities to consolidate a fragmented industry with many small regional and (inaudible) players by purchasing proven products and incorporating them into our large and growing distribution network. AOBO is well positioned to capitalize on opportunities created by the privatization of Chinese state-owned enterprises by acquiring strategic assets to broaden our product platforms, utilize our distribution network, and elaborate our strong brand reputation.

    This was a brief overview of AOBO, and I hope during the coming year we will have the chance to meet with many of you and provide a more in-depth look into our business. In summary, this was an exceptional quarter for AOBO, and we are excited about the future. We would like to thank both our shareholders and employees for their continued support and dedication. Thank you, again, everyone on this conference call. Operator: Thank you. Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time and have a wonderful day.

http://chinastockblog.com/article/4313

AOB is trending up now in a down market, currently @4.69 +.34

Some heavy institutional buying this morning made the spike.....

aob looks strong today ...it s heading nord...i was wrong

I think AOB found a support here... so what to do?  risk some money!!!

Quote from: Terlisa on December 02, 2005, 02:28:57 PM
I think AOB found a support here... so what to do?  risk some money!!!

If you got in anytime today you are better off than I am at 4.90 average price   But I think you made a good, well timed decision! 

I was sure glad to see a nice white marubozu today, it was a nice weekend gift.  I had my fingers crossed since the candlesticks yesterday did look like a reversal could occur with the spinning top candlestick yesteday after the downtrend.

I have been posting in the "Chinese are all around:  AOB" thread recently, and a few others too, some good blog stuff there, etc.

I also noticed there is starting to be insitutional interest in AOB on I watch ever since it dipped recently, so there are still a number of positive signs here.

http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=AOB&range=30&mgp=0&hdate=&x=13&y=11

Here is the instiutional buy interest signs that I was referring to below.  As you can see, it has only started after the recent price drops that occured when the dilution news came out. 

part 2 of the nice analysis:



American Oriental Bioengineering (AOB:AMEX) (12-02-05 Closing Price $4.75 USD) Strong Buy - 12-month target price: $8.33. Part 2 of 2.

Overview
On November 30th, I initiated coverage of American Oriental Bioengineering with a rating of Strong buy and a 12-month price target of 8.19. Part 1 of the report focused on quantitative measures of AOB which make it attractive; this part will focus on explaining AOB's activities and strategy going forward. I would also like to make a correction to a figure that I mentioned in part 1. Assuming the private placement goes through, AOB will have $79 million on cash, ($1.40/share), not $71 million ($1.25/share). I am also revising my target slightly upward to $8.33/share.

Market Analysis

American Oriental Bioengineering was founded in 1994 as a company focused on the manufacturing and sale of plant based medicine. Strong market growth and strong management have seen AOB grow from $100,000 in sales in 1994, to $47.6 million in sales on a last-twelve-month basis. AOB is a diversified Chinese healthcare company that operates in two distinct but related segments: plant based pharmaceutical (PBP) and plant based nutraceutical (PBN) products. The Chinese pharmaceutical/nutraceutical industry is currently estimated to be $62 billion dollars and growing at a rate of over 20% per year. The regulations regarding these 2 types of products differ, but AOB is able to gain synergies from these two distinct operating areas in terms of distribution, marketing and other administrative functions. PBP products require approval by the Chinese State FDA and are distributed to consumers via doctors and pharmacies (with prescription). PBN products do not require approval from the Chinese FDA, and are available over the counter, but often regulated by state governments. They are distributed via pharmacies and other retailers. In the first 9 months of 2005, PBP products comprised 63% of revenues and had gross margins of 63%. PBN products comprised 37% of revenue and had gross margins of 65%. AOB's core products can be classified as follows:

PBP Products

Shuanghuanglian lyophilized poweder for injection (SLPI)

SLPI is a plant based pharmaceutical marketed and approved by the Chinese FDA for treatment of viral infections. The government endorsed the usage of SLPI for treatment and prevention of SARS during the SARS crisis. An outbreak of avian flu could see a marked rise in demand for SLPI, if the government endorses it as a general immunity booster.

Cease-Enuresis Soft Gel

Cease Enuresis Soft Gel is the only Chinese FDA-approved prescription drug designed to alleviate bedwetting and nighttime incontinence. Cease Enuresis sales have grown significantly over the last year reflecting strong consumer demand for the product and increased distribution.

PBN Products

Soy Peptide Products

AOB markets the soy peptide nutraceutical in several forms: beverage, powder and pill. Soy peptide is a soy derivative that is rich in plant protein and amino acids. Soy peptide is used for its anti-fatigue properties and positive health effects including enhanced muscle development, anti-oxidant properties and many others. AOB extracts the peptide from the soy bean using a proprietary process which it describes as providing superior quality and cost. AOB produces a number of formulations of soy peptide powder, fortified with vitamins and other nutrients. The soy peptide beverages, are branded under the label "Three Happiness", and are fortified with vitamins and minerals. It is marketed as a health drink and AOB recently opened up its first retail store dedicated to selling and promoting soy peptide products; the store is named Life Peptide. This store is located in Hong Kong and could provide AOB with significant revenues going forward as well as open up the Hong Kong market to more of AOB's products. AOB also markets several variations of soy peptide pills.

AOB is well positioned from a market perspective to take advantage of the rising Chinese per-capita income, as well as an aging population. A wealthier consumer is often a more health conscious consumer, and AOB will benefit from an increase in spending on health products. Full product descriptions may be found at www.bioaobo.com

Strategic Vision and Key Developments

AOB hopes to execute a 2 pronged growth strategy. Firstly, they will seek organic growth through more extensive cross-selling and penetration of existing markets. Their retail outlet in Hong Kong is an example of a large potential contributor of organic growth going forward. Management sees their distribution network as a key success factor and seeks to leverage and expand this asset going forward. AOB currently has more than 10,000 points of sale, which they hope to grow to 20,000 within a year.

Secondly, AOB also seeks to grow through acquisition by purchasing proven products and greater distribution capabilities; integration of these will lead to growth of the top and bottom line. Management feels that they are well positioned to take advantage of accretive acquisitions through the privatization of state assets and bring added efficiency and increase the value and output of those assets. AOB is well financed to pursue their acquisition strategy. Assuming the recent private placement goes through, AOB will have $79 million in cash. This will put them in a position to make significant acquisitions going forward. AOB's market is currently fragmented, and AOB can help guide consolidation in the industry. The acquisition of a more diversified product base will also reduce the risk of AOB's revenue stream and would further enhance the value of AOB's extensive distribution network.

AOB is gaining more legitimacy in the capital markets. The recent private placement is an example of this, where Morgan Stanley picked up $20,736,000 worth of shares and warrants. Such significant support from Morgan Stanley is a positive mark on their legitimacy, and having such a well recognized institutional investor on side may bring further institutional attention to the stock. AOB has also begun holding quarterly conference calls in order to improve transparency and communication with shareholders.

Finally, as I would state for all Chinese stock with most of their revenue derived in Renminbi, there is a good chance that over the next few year there will be an upward revision in the Chinese currency. From what I have read, this could easily be as high as a 40% revision over the next 3-4 years. The Chinese have taken the first steps towards floating the currency and if they eventually allow the Renminbi to float, the effects on AOB's shares should be positive since they derive revenue in Renminbi, but report in USD.

Conclusion

AOB is a very strong company with a proven track record, excellent management and a clear focused strategy for the future. They are well positioned to take advantage of increasing wealth among Chinese consumers and growing levels of health consciousness. AOB is attractive from both a value and growth perspective, and currently trades at a 2005 forward P/E ratio of 17.4. Considering the current and historical growth rate, management's history of enhancing shareholder value, the strong balance sheet, and the possibility of a revaluation of the Renminbi, I believe that AOB deserves a forward 2005 P/E multiple of 30.5. This would be a fair multiple according to the dividend discount model, assuming a 30% growth rate for 5 years, followed by a terminal growth rate of 6.5% and a discount rate of 15%. I believe that these are all conservative and fair assumptions. AOB at this level is significantly underpriced, and I expect it to outperform the market in general. I am revising my target slightly upward and applying a 2005 forward P/E ratio of 30.5 for a 12-month target price of $8.33, representing an upside of 75% from Friday's closing price of $4.75.

http://harbinus.blogspot.com/2005/12/american-oriental-bioengineering_04.html

Thanks for the great write-up la-onda. That was very helpful.

A few months back an oldtimer from SharpCharts taught me something, about stochastics, to look for. I have been observing this unique setup of indicators since and have seen the setup over and over just prior to a breakout. Let's watch AOB and see if it follows through now. Here is the setup using both slow and fast stochastics. In a StockCharts2 beta window set your indicators as I have shown in the image below.

What I have been taught to look for is when all 3 indicators fall below the 20, then each stochastic crosses as it begins to turn up once again to the 20. When this happens, especially when all 3 turn-up at the same time a breakout will occur more times than now. For my convenience, notice I set all 3 indicator setups below the chart for cleaner observation. Finally, as I am learning -- in my watchlist, I have coined this setup 3on20 to catch my eye in the future

Like many of you, I am in AOB once again. These 3 stochastic readings simply give me one more confirmation of a breakout about to occur.

What's the latest TA on AOB?

Thanks,
MG

Back to the decreases again.    Another thing ... how come this stock doesn't have a message board on Yahoo?

News:

QuoteHONG KONG--(BUSINESS WIRE)--Dec. 9, 2005--American Oriental Bioengineering, Inc. (AMEX:AOB - News), a leading Chinese manufacturer and distributor of pharmaceutical and nutraceutical products, announced today that it has closed its private offering to accredited investors of 12.5 million units at a price of $4.80 per unit, for gross proceeds of $60 million. Each unit consists of one share of common stock, par value $0.001 per share, and three tenths of a warrant to acquire one share of common stock at an exercise price of $6.50 per share. The co-placement agents were CRT Capital Group LLC and Westminster Securities Corp. The proceeds will be used for potential acquisitions and general corporate purposes.

click here
Gross proceeds of approximately $26,527,680, reflecting subscriptions for 5,526,600 units, will continue to remain in escrow, pending (i) the expiration of the requisite waiting period under Rule 14c-2 of the Exchange Act of 1934 with respect to the company's Information Statement on Schedule 14C filed with the Securities and Exchange Commission on December 7, 2005, (ii) the filing of an amendment to the company's certificate of incorporation increasing the number of its authorized shares of common stock to 150 million and (iii) the approval of an additional listing application to be filed with the American Stock Exchange with respect to the common stock underlying the units to be issued upon release of the remaining escrowed proceeds.

Tony Liu, Chairman and CEO of American Oriental Bioengineering, commented, "The company plans to use the proceeds for general corporate purposes and seeks to identify accretive acquisition targets within our industry to diversify our product line, accelerate our growth and more effectively leverage our distribution channels."

The shares and warrants have not been registered under the Securities Act of 1933, as amended, (the "Securities Act"), or any state securities laws, and unless so registered, the securities may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. American Oriental Bioengineering has entered into a registration rights agreement obligating it to file a registration statement with the Securities and Exchange Commission registering the shares, including the shares exercisable upon exercise of the warrants, within 45 days from the closing, or January 22, 2006.

This announcement shall not constitute an offer to sell or a solicitation of an offer to buy any of these securities.

About American Oriental Bioengineering Inc.

American Oriental Bioengineering, Inc. uses proprietary processes for producing soybean protein peptide more efficiently than traditional extracting techniques. These techniques are used to manufacture and formulate supplemental and medicinal products. Soybean peptides are used widely in general food, health food products and medicines, among other applications. AOB also produces Cease-Enuresis Soft Gel, the only China State FDA-approved first-grade, plant-based prescription medicine that is specially formulated to help alleviate bed-wetting and incontinence. The company is a leading producer of products in both the nutraceuticals and pharmaceuticals areas in China. For more information, visit http://www.bioaobo.com.

About CRT Capital Group LLC

CRT Capital Group LLC ("CRT") is an institutional securities research and brokerage firm focused on high-yield and convertible debt, capital structure arbitrage, mergers and acquisitions, special situations and distressed securities. CRT trades senior and subordinated bonds, bank debt, trade claims, convertible bonds, equities, real estate loans, tax exempt securities and private placements. For more information, visit http://www.crtllc.com.

About Westminster Securities Corp.

Westminster Securities Corp. is a full-service brokerage firm operating in five principal areas: Investment Banking, Research, Account Management, Execution Services, and Clearing. Founded in 1971, Westminster is a member of the New York Stock Exchange, National Association of Securities Dealers and the Securities Investor Protection Corporation. Westminster is headquartered at 100 Wall Street, New York, with branch offices in Atlanta, Cyprus, Miami, New York, St. Louis and Toronto.

This news release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks contained in statements filed from time to time with the Securities and Exchange Commission. All such forward-looking statements, whether written or oral, and whether made by or on behalf of the company, are expressly qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.

This is a spectacular thread on AOB, sorry for taking it out of the free zone of the website (Previous 3 SOF Picks), I need it for the Premium Service 

Now, we all know AOB is fundamentally sound as you can read on the exhaustive analysis just above on this thread. Today we've had the confirmation of some alledged bad news people were complaining: American Oriental Bioengineering, Inc. Closes $60 Million Private Placement

I think this news marks the end of the medium term decline on AOB shares, and a strong rebound will start after today's open. If I could grab my shares between $4.20 and $4.40 it would be lovely, but I don't want to risk losing the boat so I'll just buy around the open, 33.33% of the 3 SOF Fast Portfolio, as always (a little more than $5,000 at this point).

The company has a P/E of 16 and a earnings growth rate of 65%, it's undervalued at this point and due for a quick rebound, at least to the descending trendline, today at $5.37 but rising everyday.

quotation from Davids link:

Tony Liu, Chairman and CEO of American Oriental Bioengineering, commented, "The company plans to use the proceeds for general corporate purposes and seeks to identify accretive acquisition targets within our industry to diversify our product line, accelerate our growth and more effectively leverage our distribution channels."


cheers
Oliver