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Disposal

13th Feb 2009 07:31

RNS Number : 2603N

LED International Holdings Ltd

13 February 2009

LED International Holdings Ltd

("LED International" or "the Group")

Disposal of Shenzen LED

Conditional to Shareholder Approval

LED International entered into a Sale and Purchase Agreement ("SPA") on 11 February 2009 to sell Shenzhen China LED Photo Technology Limited ("Shenzhen LED"), a subsidiary of the Group that is conditional on shareholder approval. This disposal amounts to a fundamental change of its business under AIM rule 15. Therefore, a resolution for this disposal will be included in the agenda of the forthcoming general meeting ("GM").

The purchaser of Shenzen LED is a Beijing based media company called Tian Fu Kai Jia Information Company Limited ("Purchaser"). The Purchaser uses LED screens at strategically situated key PRC tourist locations such as the Great Wall of China, Mount Huang (Yellow Mountain) and West Lake, providing outdoor advertising for organisations and at the same time advertising other key tourist areas within China.

Shenzen LED has not operated since August 2007. The Board undertook a strategic review after new directors joined in February 2008 as Shenzhen LED operations closed down on September 2007 with production being transferred elsewhere and no trading by or through Shenzhen LED has been undertaken since then.

In the annual report for the year ended 30 June 2008, a limitation of audit scope qualification in relation to Shenzen LED was noted in the independent auditor's report that underlines the decision of the directors to remove the company from the Group through an orderly sale.

A summary of the SPA is outlined below:

·; Sale of 100 per cent of the shares to Tian Fu Kai Jia Information Company Limited, a third party entity unrelated with LED international

·; Consideration of RMB 5m in cash and assets

·; Tian Fu Kai Jia Information Company Limited shall within one month deposit the sum of RMB100,000 to the Company as deposit for the purchase

·; The purchase consideration is by reference to the Net Asset Value of Shenzen LED in the audited accounts as at 30 June 2008

·; Shenzen LED recorded a net trading loss of HKD587,000 and trade receivables written off was HKD23,242,000 as of 30 June 2008

·; The Purchaser will have an obligation to use best endeavours to recover the bad debts and LED International will be entitled to 50 per cent of any of the bad debts recovered

·; The balance of the consideration will be settled in both cash and assets

·; The assets proportion of the consideration will be settled via the receipt of LED screens (The valuation of these assets will be carried out by an independent third party valuer and the valuation report will be available from the Company and a summary will be communicated to shareholders in a further announcement)

·; Completion is to take place within 6 months from the days from the date of valuation.

A circular will be sent to shareholders containing full information regarding the disposal in accordance with AIM Rule 15 by no later than 20 February 2009. Copies of the circular will be available on www.led-intl.com

-ends-

For further information:

LED International +852 2810 4470

www.led-intl.com

Dennis Ow, Executive Director

Zimmerman Adams International +44 (0) 207 060 1760

Dominique Doussot, Jonathan Evans

ICIS +44 (0) 207 651 8688

Christian Taylor-Wilkinson, Fiona Conroy

Notes to Editors:

LED International and its subsidiaries specialise in the development, manufacture and sale of low powered / low maintenance LED screens and other LED products such as outdoor signs, lamps, lighting and building illumination. The screens are manufactured in a 'building block' format to a specific design, which allows screens to be assembled to suit a customer's size and definition specifications.

This design also ensures that the screens are relatively easy to transport and assemble. Based in Hong Kong, the Company's primary market has been the People's Republic of China ("PRC"), but it has also supplied end products to Macau, Japan and the USA. Part of the Company's strategy in 2007 was to widen its customer base to markets outside PRC.

The Company listed on AIM, a market operated by the London Stock Exchange, on 23 October 2006. For more information, please visit: http://www.led-intl.com.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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