Yongye Biotechnology International Raises $9.4 Million in Private Placement

Wednesday, September 10, 2008 General News
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BEIJING, Sept. 10 Yongye BiotechnologyInternational, Inc. (OTC Bulletin Board: YGYB; "Yongye" or the "Company"), aleading developer, producer and distributor of nutrients for plants andanimals in the People's Republic of China, today announced that it closed aprivate placement financing with certain institutional investors led by BlackRiver Asset Management, pursuant to which the Company issued 6,073,006 sharesof its common stock for gross proceeds of approximately $9.4 million. RothCapital Partners served as the placement agent.

The Company intends to use the proceeds from this placement to beginrestructuring Yongye Nongfeng Biotechnology Co. ("Yongye Nongfeng"), theCooperative Joint Venture (CJV) through which Yongye conducts operations inChina, and for working capital. The initial steps in the restructuring willbe to purchase production equipment located at an existing 2,000 Tonnes PerAnnum (TPA) production line that is owned by the Company's current contractmanufacturer, Inner Mongolia Yongye Biotechnology Company, Ltd. ("InnerMongolia Yongye"), which is scheduled to occur by the end of October 2008, andto construct a new 8,000 TPA production facility, which is scheduled to becompleted by the middle of October 2008. The combined 10,000 TPA capacity ofboth facilities will allow the Company to produce its own finished goods inthe quantities needed to fulfill its current and future sales goals. Afterthe completion of the equipment purchase and the integration of the equipmentwith the Company's new 8,000 TPA facility, the Company will discontinue itscurrent exclusive contract manufacturing agreement with Inner Mongolia Yongye.The final step to the restructuring will be to transfer to the CJV all of theland, buildings and permits that belong to Inner Mongolia Yongye, and the newmanufacturing facility, which will make the CJV the Company's ownmanufacturing and distribution entity. The full restructuring process is notexpected to be completed until late summer of 2009.

"The money that we receive from this additional financing will helpsustain our rapid pace of growth," said Mr. Wu, Chairman and CEO of Yongye."Our business has outgrown our current manufacturing capabilities, and we needto be able to supply our distribution network with more of our currentproducts and new products which we are planning to produce in the future."

The securities issued in the private placement have not been registeredunder the United States Securities Act of 1933 or the securities laws of anyother jurisdiction. Accordingly, these securities may not be sold byinvestors in the United States, except pursuant to an effective registrationstatement or an applicable exemption from the registration requirements.

This press release does not constitute an offer to sell or thesolicitation of an offer to buy any security and shall not constitute an offer,solicitation or sale in any jurisdiction in which such offer, solicitation orsale would be unlawful.

About Yongye Biotechnology International, Inc.

Yongye Biotechnology International, Inc., headquartered in Beijing, isengaged in the development, distribution and sales of fulvic acid basednutrients for plants and animals. The Company's patent pending processes andproprietary formulas allow it to create products which increase crop yieldsand improve the health of livestock. Its sole operating subsidiary, YongyeNongfeng Biotechnology Company, Ltd., is located in Inner Mongolia. TheCompany sells its products through distributors and directly to farmerslocated in ten provinces throughout China.

Forward Looking Statements

Certain statements set forth in this press release constitute"Forward- looking statements" within the meaning of the Private SecuritiesLitigation Reform Act of 1995. Forward-looking statements include, withoutlimitation, any statement that may predict, forecast, ind

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