American Dairy Announces Acquisition by Subsidiary Feihe Dairy LOS ANGELES and KEDONG COUNTY, China, Nov. 24 /PRNewswire-FirstCall/ -- American Dairy, Inc. (BULLETIN BOARD: ADIY) , one of the leading producers and distributors of milk, milk powder and related dairy products in China, today announced that its wholly owned subsidiary Feihe Dairy will acquire Heilongjiang-based Kedong BEIBEI Foodstuff Co., Limited. American Dairy will acquire all outstanding shares of Kedong BEIBEI Foodstuff Co., Limited. for a total equity consideration of US$400,966, the appraisal value for the property is over US$1,000,000. The property consists of land use rights of 40,000 square meters of land and 6,000 square meters of factory building in Kedong County Heilongjiang Province, China. "This acquisition demonstrates American Dairy's aggressive execution of key expansion and business development strategies," said Leng You-Bin, Chairman, Chief Executive Officer and President of American Dairy. "Through the acquisition of Kedong BEIBEI Foodstuff, Co., Limited's land use rights and processing capacity, Feihe Dairy will establish a new production line of milk powder. Leveraging our strong brand identity and reputation, we believe that this new milk powder production line will be the premier line of its class in China and among the top milk powder production lines in the world. "Feihe will be able to process an additional 300 tons of fresh milk daily following the acquisition," You-Bin added. "Already one of the largest independent dairy enterprises in China, we compete with few large volume dairy processors, and most of China's milk is produced by small scale, low production dairy farming households. Our acquisition of Kedong BEIBEI Foodstuff, Co., Limited. significantly increases our production scale in our market region, and will enhance our efforts to capture a growing share of the Chinese dairy market." Currently, American Dairy's large-scale dairy production has annual processing power of 112,000 metric tons. American Dairy's access to cattle herds of approximately 8,500 milk cows generate annual milk output of approximately 30,000 metric tons. Affiliated farmers have grazing rights covering over 516,000 acres in Kedong County in northeastern China. About American Dairy, Inc. American Dairy, Inc. conducts operations in the People's Republic of China ("China") through its wholly owned subsidiary Feihe Dairy. Founded in 1962, Feihe Dairy is one of the leading producers and distributors of milk powder, soybean milk powder, liquid milk and related dairy products in China. Feihe Dairy's 99% owned subsidiaries Sanhao Dairy and Baiquan Feihe Dairy produce and supply processed milk to Feihe Dairy. Forward-Looking Statements Statements in this document that are not statements of historical or current fact constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other unknown factors that could cause the actual results of the Company to be materially different from the historical results or from any future results expressed or implied by such forward-looking statements. In addition to statements which explicitly describe such risks and uncertainties, readers are urged to consider statements labeled with the terms "believes," "belief," "expects," "intends," "anticipates," "will" or "plans" to be uncertain and forward-looking. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in the Company's reports and registration statements filed with the Securities and Exchange Commission. For further information please contact: Karney Chang, General Information, of American Eastern Securities, +1-213-488-5131, ext. 106, , for American Dairy, Inc. DATASOURCE: American Dairy, Inc. CONTACT: Karney Chang, General Information, of American Eastern Securities, +1-213-488-5131, ext. 106, , for American Dairy, Inc.

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