Friday, April 1, 2011

Coates International Ltd. (COTE.OB) Signs Letter of Intent to Merge with Chinese Firm

Coates International Ltd. has spent over 15 years developing a patented spherical rotary valve CSRV internal combustion engine. This engine runs on a number of different fuels including gasoline, natural gas, ethanol, methanol, diesel and hydrogen. The engine has reduced maintenance requirements, reduced fuel consumption, reduced emissions and increased power.

The company announced today that it has signed a letter of intent to merge with an industrial engine and generator manufacturing company in China. The merger is subject to certain conditions and governmental approvals, including raising capital internationally.

The Chinese manufacturer currently employs more than 2,000 skilled plant workers and produces over 80,000 industrial electric power generator sets per year. Since negotiations started eight months ago, the Chinese company has built a new one million square foot manufacturing plant where the Coates CSRV natural gas electric power generators are planned to be manufactured.

Coates’ management believes that if it is to get into mass production of its engines soon, it must act now and it has. The company will benefit from this merger in a number of ways including: mass production of its engines, lower manufacturing costs than expected, the ability to generate revenues and cash flows from sales and license fees, as well as access to working capital internationally which will allow for greater product manufacturing capabilities.

For more information on Coates International, please visit its website at www.coatesengine.com

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