CDS China Direct (MM)

CDI Beijing Joint Venture Receives Business License from Chinese Government DEERFIELD BEACH, Fla., Sept. 17 /PRNewswire-FirstCall/ -- China Direct, Inc. (NASDAQ:CDS), a U.S. company that owns controlling stakes in a diversified portfolio of Chinese entities and assists Chinese businesses in accessing the U.S. capital markets, announced today that it previously disclosed joint venture, CDI (Beijing) International Trading Co., Ltd., ("CDI Beijing") was granted a business license by the Chinese government to engage in the distribution of steel and lumber products in China. Under the terms of the previously disclosed joint venture agreement, CDI Shanghai Management Co., Ltd. ("CDI Shanghai"), a wholly owned subsidiary of China Direct, will invest approximately $3.73 million in CDI (Beijing) to obtain a 51% interest in the joint venture. CDI Shanghai made its initial investment of $750,000 and will contribute the remaining $2.98 million to CDI Beijing on or before June 30, 2009. CDI Beijing will distribute to end users in China and abroad a variety of basic material products including steel and wood for various suppliers. Management believes CDI Beijing can vertically integrate with our zinc, lead and magnesium operations by providing additional sales and distribution relationships. Management is confident in CDI Beijing's management team, which has built a network of relationships in a number of domestic and foreign markets, and anticipates CDI Beijing's operations will begin contributing to China Direct's bottom line as soon as the fourth quarter of 2008. In addition to being a strong contributor to performance in 2009 from its distribution of steel and wood products, CDI Beijing is seen by management as having the ability to increase performance in its zinc, lead and magnesium operations by leveraging its customer relationship base which adds potential new sales channels. China Direct intends make every effort to maximize the potential distribution synergies among our various portfolio companies. Dr. James Wang, CEO and Chairman of China Direct, indicated, "We are pleased to welcome CDI Beijing into the China Direct family as we continue to expand our Basic Materials Segment. We are confident CDI Beijing will be accretive to our financial performance in the fourth quarter of 2008 and into 2009. The formation of CDI Beijing is part of our strategic plan to grow our basic materials segment to $200 million in revenue in 2009. We anticipate maximizing the customer relationships developed by CDI Beijing management in growing these new product lines to our basic materials segment. In addition, management is evaluating other potential acquisitions in the chemical industry as we move forward into 2009 and we are confident CDI Beijing will play an important role in the distribution of any new products as well as our current product offerings within this segment." About China Direct, Inc. China Direct, Inc. (NASDAQ:CDS) is a diversified management and advisory services organization headquartered in the U.S. Our management services division acquires a controlling interest in entities operating in China. Our ownership control enables China Direct to provide management advice, as well as financing to Chinese entities. This infrastructure creates a platform to expand business opportunities globally while accessing the U.S. capital markets. Our advisory services division provides comprehensive advisory and consulting services to Chinese entities seeking to access the U.S. capital markets. As a direct link to China, China Direct serves as a vehicle allowing investors to directly participate in the rapid growth of the Chinese economy in a diversified and balanced manner. For more information about China Direct, please visit http://www.chinadirectinc.com/ . DISCLOSURE NOTICE: In connection with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, China Direct, Inc., is hereby providing cautionary statements identifying important factors that could cause our actual results to differ materially from those projected in forward-looking statements (as defined in such act). Any statements that are not historical facts and that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, indicated through the use of words or phrases such as "will likely result," "are expected to," "will continue," "is anticipated," "estimated," "intends," "plans," "believes" and "projects") may be forward-looking and may involve estimates and uncertainties which could cause actual results to differ materially from those expressed in the forward-looking statements. These statements include, but are not limited to, our expectations about our future success, our ability to successfully develop our planned steel and wood product distribution business in a cost effective manner that enhances our financial condition. We caution that the factors described herein could cause actual results to differ materially from those expressed in any forward- looking statements we make and that investors should not place undue reliance on any such forward-looking statements. Further, any forward- looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict all of such factors. Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. This press release is qualified in its entirety by the cautionary statements and risk factor disclosure contained in our Securities and Exchange Commission filings, including our Annual Report on Form 10-K for the year ended December 31, 2007 and our reports on Form 10-Q. DATASOURCE: China Direct, Inc. CONTACT: Investor Relations: James Kautz, , or Todd Atenhan, +1-404-806-1393, both of EPOCH Financial Group, Inc.; or Richard Galterio, Executive Vice President of China Direct, Inc., +1-877-China-57, Web site: http://www.chinadirectinc.com/

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