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Longhai Steel Retains MZ Group as Its Investor Relations Firm

Longhai Steel Retains MZ Group as Its Investor Relations Firm

Longhai Steel Inc. (OTCBB: LGHS), a producer of high-quality steel wire products in the People’s Republic of China, similar to companies Baoshan Iron & Steel Co., Ltd. (SHA:600019) and United States Steel Corporation (NYSE: X), recently announced that it has retained MZ Group as its investor relations firm to assist with corporate communications.

MZ will assist Longhai with communicating its corporate, financial and investor developments to shareholders and investors, while building a strong public brand and investor base. Ted Haberfield, Scott Powell, Derek Gradwell, and the MZ Group team will be advising the Company in all facets of corporate and financial communications.

“We look forward to our partnership with MZ Group,” said Steven Ross, Executive Vice President of Longhai. “As we expand our corporate branding and investor relations efforts around the world, we believe MZ Group provides the global reach and an established track record that will help us be more successful. Their strong relationships with retail and institutional investors in Asia and North America in particular will help us tell the Longhai Steel story to more investors.”

“Longhai offers investors a tremendous combination of rapid growth at a compellling valuation,” said Ted Haberfield, President of MZ North America. “We are firm believers in the secular growth opportunities in global natural resources, particularly in emerging markets. The Company’s investments over the past several years have positioned Longhai to realize the benefits in 2012 and beyond. We look forward to working with management to help articulate the exciting developments to investors in the U.S. and China.”

About Longhai Steel Inc.

Longhai Steel is a leading producer of high-quality steel wire in eastern China, with annual capacity of 1.5 million metric tons. Longhai’s wire is manufactured into screws, nails, and wire mesh used for fencing and to reinforce concrete. Longhai recently expanded its production facility to include specialized applications such as steel wire rope, steel strand, steel belted radial tires, and steel welding rod. Demand is based on spending in the construction, automotive and infrastructure industries in China. Company website: .

Safe harbor statement

Certain statements in this news release are forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. These forward-looking statements can be identified by terminology such as “anticipate,” “believe,” “could,” “estimates,” “expect,” “future,” “intends,” “may,” “plans,” “should,” “will,” and similar statements.

The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding China’s economic growth, general industry conditions including local supply and price of wire, environmental risks, Longhai’s business or growth strategy, Longhai’s ability to achieve the new facility’s production expectation; Longhai’s ability to develop and produce higher margin products that achieve market acceptance; the success of Longhai’s investments, risks, and uncertainties regarding fluctuations in earnings, its ability to sustain its previous levels of profitability including its ability to manage growth, intense competition, wage increases in China, its ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, its ability to successfully complete and integrate potential acquisitions, withdrawal of governmental financial incentives, political instability and regional conflicts, and legal restrictions on raising capital or acquiring companies outside China. Although Longhai believes that its expectations stated in this press release are based on reasonable assumptions, actual results may differ from those projected in the forward-looking statements. Although these expectations and the factors influencing them will likely change, we are under no obligation to inform you if they do. These and additional risks that could affect Longhai’s future operating and financial results are more fully described in its filings with the U.S. Securities and Exchange Commission. These filings are available at .

Longhai may, from time to time, make additional written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission on forms 10-K, 10-Q, and 8-K, in its annual report to shareholders, in news releases and other written materials, and in oral statements made by its officers, directors, or employees to third parties. Longhai does not undertake to update any forward-looking statements that may be made from time to time by or on its behalf, except as required by law.

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Longhai Steel Undervalued and Outpacing its Higher-Priced Peers

Longhai Steel Undervalued and Outpacing its Higher-Priced Peers

The global steel industry experienced a slowdown for several years before ramping upward again in 2009.  According to the World Steel Association, global crude steel production in 2011 reached 1,527 megatonnes for the full year, a 6.8% increase compared to 2010.  A huge, but concentrated industry, a few majors, such as ArcelorMittal (NYSE:MT) and US Steel (NYSE:X) have been providing the lion’s share of steel to the automakers like Ford (NYSE:F) and Toyota Motor Corp. (NYSE:TM) for years.  The sheer magnitude of the $430 billion steel industry, however, leaves incredible upside for relatively ignored companies, such as Longhai Steel Inc. (OTCBB:LGHS), a China-based producer of high-quality steel wire.

Longhai’s 200,000 square meter facility is located in Xingtai City, right in the heart of the steel production district in Hebei Province, China.  Its steel wire is sold domestically and used primarily in the construction industry as the steel is processed into screws, nails, wire mesh for concrete and fencing.  Business is booming for Longhai with record production and sales reported in the fourth quarter of 2011.  During the quarter, the company’s steel wire output was 293,862 Metric Tons, an increase of 23% from the year prior quarter.  Steel wire sales for the quarter increased by 30% to 335,229 Metric Tons in Q4 2011 as compared to Q4 2010.

Longhai Steel is a component of the vertically integrated Longhai Steel Group, which offers them significant advantages over competitors.  For starters, the steel billet that gets processed by Longhai Steel into steel wire comes from across the street at its parent company.  This translates to virtually no shipping costs for LGHS that competitors must shoulder as an expense.  Additionally, the steel is literally still steaming from the extreme heat of processing by Longhai Steel Group when it is delivered to LGHS, translating to lower manufacturing costs and less energy use as a result of not having to heat the steel as much as normally would be required.

LGHS has just opened a second, state-of-the-art production line next door to its original facility that, once fully ramped, will boost its production by an additional 67 percent.  This new line will also open the door to additional clientele as it has the ability to produce alloy steel, cold forging steel, welding rods and steel strands for applications such as wire rope and steel belted radial tires.  LGHS is again a beneficiary of being part of the Longhai Steel Group who is leasing the facility to LGHS for a minimal monthly payment.  Plans for a third production line, targeted for 2013, are already in the works.

Longhai posts the type of numbers that are rarely – if ever – produced by an OTC listed company.  Final figures from 2011, which will reflect sales increases from the fourth quarter, have not been released to date, but trailing twelve month (ttm) figures will make most OTC investors’ jaws drop.  As of Q3 2011, ttm revenue tallied a whopping $555.31 million for LGHS.  Net income equaled $9.32 million.  Diluted Earnings Per Share for the ttm is a stellar $0.93.  If those numbers aren’t impressive enough…the company has NO DEBT.

Taking a moment to separate the wheat from the chaff, Longhai outstrips plenty of its big board competitors.  China Gerui Advanced Metals (NASDAQ:CHOP) has a ttm revenue that equals $315.98 million.  Sutor Technology Group Ltd.’s (NASDAQ:SUTR) ttm revenue rings in at $459.95 million.  Industry giant General Steel Holdings, Inc. (NYSE:GSI) has a ttm revenue of $2.15 billion, but its massive debt load taints the picture for GSI.

A very commonly used analysis of industry peers is the P/E ratio.  Juxtaposing companies via this metric show CHOP, SUTR and GSI to have P/E ratios of 4.23:1, 3.29:1 and 61.11:1, respectively, as compared to LGHS’s tiny ratio of 1.08:1.  By that standard, the company is clearly undervalued.

By virtually all standard measures, LGHS should be a stalwart in relation to peers.  Take a look at a few of these other stats:

The sales increases in Q4 will further bolster Longhai’s balance sheet.  Factoring in a second line running full bore and the company could reach $1 billion in revenue in 2012.  With a miniscule number of outstanding shares (10 million), LGHS is only commanding a $10 million market cap; a ridiculously low amount for a company of its capacities.  It’s a head-scratcher to see a company with a net income that nearly equals their market cap.  It may be ignored at the moment, but a company such as Longhai Steel Inc. will not fly under the radar forever when it is approaching billion-dollar revenue figures, carrying no debt and a price tag of only $1 per share.  Frankly, it’s a bit amazing that it has for this long.

To learn more about Longhai Steel, please see the following resources:

Company Website

Investor Presentation

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EastBridge (EBIG) Targets Additional U.S. Clients

EastBridge (EBIG) Targets Additional U.S. Clients

EastBridge Investment Group Inc. (OTCBB: EBIG), a provider of financial services to emerging companies looking to raise capital or go public in the U.S., with clients similar to companies like Chinacast Education Corporation (NASDAQ: CAST) and A123 Systems Inc. (NASDAQ: AONE), is targeting additional U.S. clients and helping them to raise capital ahead of going public.

The company’s unique business model involves receiving a combination of cash and equity in exchange for helping these companies. Depending on the amounts of each, the firm has traditionally issued a portion of the stock received as a dividend to its own shareholders, while maintaining the balance on its books as an asset or selling it to generate revenues.

EastBridge Signs Fizza in December 2010

EastBridge entered into an agreement in December of 2010 to assist Fizza LLC in raising bridge capital of $300,000 in exchange for a combination of cash and equity. Since then, the agreement has been expanded to help the company identify legal counsel, financial advisors and capital to raise $2 million in financing to expand its business.

Fizza has developed a nutritious sparkling dairy beverage that contains all the qualitative nutrients of milk and the fun of soda. Available in orange, strawberry, apple and cola, the fat and lactose free beverages have no artificial sweeteners but all the qualitative nutrients of milk. The company is hoping to position these in both retail and educational settings.

EastBridge Signs Air Medical in October 2011

EastBridge entered into an agreement in October of 2011 to assist International Air Medical Services Inc. (IAMS) with locating legal counsel, financial advisors and capital to complete a capital raise of up to $3 million. While no financial details were disclosed yet, investors expect to see some details in the company’s upcoming SEC filings.

After receiving $176,000 in financing and completing 206 missions in its first year, the company’s predecessor (Native Air) grew to conduct about 6,000 missions per year six years later and eventually sold for $54 million. Management is now refocusing on the long range transportation segment that accounts for about 23% of emergency air medical demand.

Additional Clients in the U.S. and Abroad

As of September 2011, EastBridge was providing consulting services to eight clients to assist them with the auditing and legal processes to become public companies in the United States and become listed on a U.S. stock exchange, in addition to the aforementioned agreements. And it’s also working with Cambrium Learning (NASDAQ: ABCD) to identify a JV partner in China.

Combined, these factors make EastBridge a stock worth watching for early stage investors. For more information on the company, please see the following resources:

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EastBridge (EBIG): Bringing Healthy Soft Drinks to Market

EastBridge (EBIG): Bringing Healthy Soft Drinks to Market

EastBridge Investment Group Inc. (OTCBB: EBIG), a provider of financial services to emerging public companies, is helping client Fizza LLC raise capital to change a soft drinks market dominated by PepsiCo Inc. (NYSE: PEP) and Hansen Natural Corporation (NASDAQ: HANS). Led by a solid management team, the company is pioneering the healthy soft drinks market.

Fizza has developed a nutritious sparkling dairy beverage that contains all the qualitative nutrients of milk and the fun of soda. Available in orange, strawberry, apple and cola, the fat and lactose free beverages have no artificial sweeteners but all the qualitative nutrients of milk. If successful, EastBridge’s equity received from this agreement could pay big dividends.

EastBridge Signs Agreement with Fizza

EastBridge executed an agreement in late 2010 to help Fizza raise up to $3,000,000 in funding to produce its products and bring them to market in a timely fashion, according to an 8-K filing with the SEC. Under the terms of the agreement, EastBridge will receive a combination of cash and equity that was not disclosed in the agreement.

This arrangement enables EastBridge to realize some income upfront in addition to realizing back end equity that can appreciate over the long-term. In the past, the company has issued some of this equity to its own shareholders in the form of a dividend. The rest is either reported on the balance sheet as an asset or sold to generate additional revenues.

Providing Healthy Alternatives to Soft Drinks

Obesity is one of the largest threats to child health, according to many doctors. While there are many causes of childhood obesity, excessive consumption of sugar-sweetened drinks has been linked to the disease by several studies. As a result, many school cafeterias have banned soft drinks from their menus and instead offer only healthier alternatives.

Fizza has been approved by the USDA for sale in school cafeterias and is often times the only carbonated beverage available. With a potential $300 million market in schools, this represents a significant addition to its $1.1 billion potential in retail stores. And in total, these figures represent just 0.9% of the $153 billion liquid refreshment market.

Another Great Reason to Invest in EastBridge

EastBridge offers investors a unique opportunity to invest in a diversified portfolio of emerging public companies. With clients ranging from Chinese education companies to U.S. companies seeking joint ventures, the company is building significant equity with a track record of generating shareholder value through equity dividends.

For more information on EastBridge, please see the following resources:

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