Steel Pipe Maker ZK International Joins in Cryptocurrency Mania
Chinese steel pipe maker, ZK International, has received two capital infusions from blockchain investors and cryptocurrency players, including one investment received in Bitcoin.
In a remarkably clear sign of the times, ZK International Group Co. Ltd., a maker of steel pipes in China, announced today that it received a $500,000 investment in the company paid in the cryptocurrency Bitcoin.
The Wenzhou-based company, which completed an initial public offering last year on Nasdaq, said the investment was made by Layla Dong, CEO and founder of Blockshine Technology Corp. The company reported in a regulatory filing after the market closed today that Dong paid 34.123 Bitcoins for the 62,500 shares, equal to $8 per share. ZKInternational (Nasdaq: ZKIN) closed today at $10.61 per share, down 2 cents on the day.
"We are excited about the avenues that this investment and the relationship with Ms. Dong may potentially open up for us," said Jiancong Huang, ZK International's CEO in an announcement about Dong's pending investment earlier this week. "We believe that Ms. Dong is one of the most influential people in China and is regarded as one of the brightest minds in the region."
Dong, a former editor and project manager at HarperCollins Australia, is CEO and founder of Blockshine Communications in Shanghai. Blockshine Communications is primarily a supplier of blockchain-related information to businesses in the area of cryptocurrency exchanges, blockchain business infrastructure, branding, and intellectual property, according to its website.
While it's not clear what interest a "designer, engineer, manufacturer and supplier of patented high-performance stainless steel and carbon steel pipe products" has in blockchain technology, this week's announcement was not the company's first involvement in the heated cryptocurrency market.
This latest announcement from ZK International came two weeks after the company said it received a $520,000 investment from NGST Ltd., a company owned by Antanas Guoga, founder of Blockchain Centre, a shared office space in Vilnius, and Exigent Capital, a firm that specializes in cryptocurrency trading.
The private placement, completed Dec. 28, was for 86,666 restricted ordinary shares at a price of $6 per share. ZK International, which sold 1 million shares at $5 per share in its August IPO, has 13.5 million shares outstanding with the CEO, Jiancong Huang, owning nearly 70 percent, according to regulatory filings.
"I am excited about the investment, not only for its economic benefit, but also because of the investors' industry know-how and knowledge that they bring to the Company," Huang said.
Guoga, a member of the European Parliament from Lithuania whose nickname is Tony G., is a former investment manager and investor in real estate and online ventures, including businesses called TonyBet, TonySports, TonyResort, and TonyStreets, an online sports and leisure store, according to Wikipedia.
Exigent describes itself on its website as a "proprietary trading firm applying quantitative and high frequency trading strategies to cryptocurrency exchanges around the world," though no more information about the company is provided. It does not appear to be connected to the Exigent Capital investment firm based in Jerusalem. The two companies could not be reached for clarification.
Since the IPO, ZK International has seen its stock price double before pulling back. It then jumped more than one-third after the blockchain-related announcements, reaching above $12 per share in recent days.
The company, which has not released financial results since its filings with the Securities and Exchange Commission in relation to its IPO, reported revenue of $36.8 million for 2016 and net income of $5.3 million.