ShengdaTech, Inc. Engages KPMG as New Independent Auditor

ShengdaTech Inc., a leading manufacturer of nano precipitated calcium carbonate and a major manufacturer of coal-based chemical products in Shandong Province, PRC, today announced that it has engaged KPMG as its new independent registered public accounting firm, effective November 11, 2008. KPMG replaces Hansen, Barnett & Maxwell, P.C., which was dismissed on November 11, 2008.

The decision to change the independent registered public accounting firm was recommended, authorized, and approved by the Company’s Audit Committee and Board of Directors. ShengdaTech reports that there are no disagreements with Hansen, Barnett & Maxwell, P.C. on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure from the time of the initial engagement to its dismissal, including the Company’s most recent fiscal year and the subsequent interim periods through September 30, 2008. The Company further notes that, if any such disagreement had not been resolved to Hansen’s satisfaction, reference would have been made in the reports of independent registered public accounting firm on the Company’s financial statements.

“We are pleased to engage KPMG to serve as our new independent auditor. We believe that KPMG, as a leading global accounting firm, has the extensive experience, client-focused approach, and local presence that will benefit our shareholders and us. We look forward to working with them to build a strong professional relationship in the future,” commented Mr. Xiangzhi Chen, President and CEO of ShengdaTech.

About ShengdaTech, Inc.

ShengdaTech is engaged in the business of manufacturing, marketing and selling nano-precipitated calcium carbonate (“NPCC”) products and coal-based chemicals for use in various applications. The Company converts limestone into NPCC using its proprietary technology co-developed with Tsinghua University. ShengdaTech is the only company possessing proprietary NPCC technology in China. Its NPCC products are mainly exported to countries like South Korea, Singapore, Malaysia, Vietnam, etc. The Company is also engaged in the manufacture and sale of coal-based chemical products namely ammonium bicarbonate, liquid ammonia, melamine and methanol. The Company markets and sells its coal-based products mainly for chemical fertilizers and raw materials in the production of organic and inorganic chemical products, including formaldehyde and pesticides.