Ninetowns Announces Acquisition of Land Use Rights, Launch of New Property Development Initiative and Share Repurchase Program.

Ninetowns Internet Technology Group Company Limited (NASDAQ: NINE) ("Ninetowns" or the "Company"), one of China's leading providers of online solutions for international trade,announced that the Company had the winning bid in a land auction held on March 30, 2011 in Huainan, Anhui Province, China and received the right to acquire land use rights for a piece of undeveloped land consisting of approximately 141,000 square meters at a price of RMB1,830 per square meter, for a total consideration of approximately RMB258 million (US$39 million).

Ninetowns intends to develop a mixed-use real estate project tentatively named "Smarter Town" on such land. According to the terms and conditions of the auction, the Company is committed to (i) design, develop, construct, market and sell certain retail and residential units, (ii) design and construct an "Internet of Things" exhibition park, and (iii) design and construct a community hospital.

The land is permitted for commercial and residential use. The commercial land use rights and the residential land use rights will expire in 40 years and 70 years, respectively.

Ninetowns entered into a land use right grant contract with the Huainan Land Resource Bureau on April 7, 2011. On March 23, 2011, Ninetowns paid a deposit of RMB50,790,000 (US$7.7 million) to the Huainan Finance Bureau, which will be credited towards the land premium to be paid after the land use right grant contract is executed.

Ninetowns' acquisition of the land use rights represents a key step in the Company's new strategic initiative to capitalize on the growth of the real estate market in China. Over the past ten years, Ninetowns has gained substantial experience in the Internet of Things ("IOT") industry in China. While the Company continues to operate its enterprise software and e-grocery businesses, it believes that there is an emergence of a niche real estate market in China that integrates IOT related technology with community life and urban operations, sometimes known as the "The Smarter City" originally coined by IBM's idea of "The Smarter Planet". The idea is to establish a city that is also a center of business, culture and life that integrates innovations such as more advanced education, healthcare, water and energy utilization, public safety, transportation and government operations. Ninetowns believes that its strategic use of technology in developing Smarter Cities may help to drive sustainable growth and prosperity, which are some of the challenges that today's city leaders face. Feasible solutions and new technologies for data management and resource coordination can help to improve allocation and usage of natural and human resources in city operations. Ninetowns' management believes that Ninetowns' track record as an innovative software company will allow Ninetowns to capitalize on the emergence of this niche real estate market in China.

Ninetowns intends to participate in additional real estate development projects that involve three product models (i) intelligent residential communities, (ii) Smarter Senior Living Communities and (iii) e-commerce bio-system industrial parks, primarily in third-tier and fourth-tier cities in China.

Mr. Shuang Wang, Chief Executive Officer of Ninetowns, commented, "Supported by powerful macro-economic trends, including rising GDP, increasing urbanization and growing disposable income and the worldwide ever-increasing usages of cloud computing and the Internet of Things, we believe that we can capitalize on these trends given our extensive IT industry experience. While continuing to operate the enterprise software and e-grocery food businesses, we will explore in this new business area to create long-term value for our shareholders."

Keywords: Asia, Business Software and Service Companies, China, Industry, Ninetowns Internet Technology Group Company, Ninetowns Internet Technology Group Company Limited, Real Estate, Technology Companies.

This article was prepared by Telecommunications Weekly editors from staff and other reports. Copyright 2011, Telecommunications Weekly via VerticalNews.com.