16th May 2014 09:30
LONDON (Alliance News) - LED International Holdings Ltd Friday warned it is yet to receive a CNY100 million investment from mainly Taiwanese investors announced in March, and it continues to experience difficult trading conditions which it said could lead to a significant reduction to shareholder value unless it secures new funds.
The Chinese LED lighting company said it is yet to receive cash related to the placing and issue of convertible loan notes, and said it is unable to confirm when, or even if, the funds will be received.
The company announced in March that it secured the CNY100 million investment from Best Merchant Ventures Ltd, Legend Giant Ventures Ltd, Talent Plus Ventures Ltd and Y&C International Holdings Group Ltd. It said it would use the funds to provide necessary capital to LED's leasing finance company Green Pearl Leasing Co Ltd and general working capital.
The company said that with regards to the delayed or possibly cancelled investment, it is considering all possible ways to solve the problem and receive the unpaid funds.
However, it added that it continues to experience difficult trading conditions and its working capital remains constrained. As such, the company said it is now looking to secure alternative funding in the near future.
LED International warned that if it struggles to receive funding in the near term, it may have to take action would could significantly reduce its value to shareholders.
The company had been struggling with financing for some time. Earlier in March the company said it still hadn't received funds from a recent subscription offer and at that time was considering talks with another party about getting much-needed funding.
The energy saving products company had announced a proposed capital raising at the end of December after its energy management contract business plan was delayed. At that time, it borrowed CNY6 million from Rubyfield Holdings Ltd and Speedy Dragon Holdings Ltd under a working capital loan, and said it would raise CNY25 million through a subscription with those companies. The placing and the loan proceeds combined total CNY31 million.
In February, the company had said that it was still trying to raise CNY31 million from the two investors in an attempt to secure its immediate future and fund its new lease financing unit.
LED International shares were down 79% to 3.50 pence, making it the top AIM ALL-Share faller in early trading on Friday.
By Tom McIvor; [email protected]; @TomMcIvor1
Copyright 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
Led International Holdings