September 30, 2010 (FinancialWire) — Keyuan Petrochemicals, Inc. (NASDAQ: KEYP), a Chinese maker of various petrochemical products, said that it has closed a private placement financing with institutional investors with gross proceeds of $20.3 million to fund the purchase of raw materials for its petrochemical production facility.

The lead investor was Prax Capital, a China-focused private equity fund that invests in the company through its solely owned investment vehicle Dragon State International Limited.

Under the deal, Keyuan issued 540,001 investment units. Each unit includes 10 shares of Series B preferred stock convertible into ordinary common shares, in addition to 1.5 Class C warrants with an exercise price of $4.50 per share and 1.5 Class D warrants with an exercise price of $5.25.

China-based Keyuan Petrochemicals operates through its wholly-owned subsidiary, Keyuan Plastics, Co. Ltd. The firm launched production in October 2009. Keyuan's operations include an annual petrochemical manufacturing design capacity of 550,000 MT for a variety of petrochemical products, with facilities for the storage and loading of raw materials and finished goods.

The firm plans to expand its manufacturing capacity to include a SBS production facility, additional storage capacity, a raw material pre-treatment facility, and an asphalt production facility.

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