LED International Holdings Ltd Disposal of Kepu (0156A)

TIDMLED

RNS Number : 0156A

LED International Holdings Ltd

17 December 2014

17 December 2014

LED International Holdings Limited

("LED" or the "Company")

Disposal of Kepu Electronic Technology (Shenzhen) Company Limited

The board of directors of LED (the "Board") is pleased to announce that on 17 December 2014 the Company entered into sale and purchase agreements with Mr. Fu Wei ("Fu") relating to the disposal by the Company of the remaining effective equity interest (60 per cent.) in Kepu Electronic Technology (Shenzhen) Company Limited ("Kepu").

Kepu specialises in the research, development and manufacturing of its own brand of opto-electronic products, such as LED modules, LED unit boards and LED bar-screens, which are used in consumer electronic goods such as air-conditioners, microwave ovens, conventional ovens, refrigerators, washing machines and fixed line telephones.

As announced on 17 May 2012 and as a part of its ongoing business review, the Board had determined that the activities of Kepu present considerable, but different, opportunities from LED's primary focus on its energy management contract ("EMC") business model. As currently structured, the Company does not have the resources to take full advantage of the opportunities available to Kepu nor does the Board foresee Kepu becoming a profitable member of the Group in the foreseeable future. For this reason, the Company has taken the decision to sell its remaining interest in Kepu. This will provide the Company with further resources to promote and focus on its EMC business model.

In pursuance of this strategy, the Board is pleased to announce that the Company has disposed of its effective equity interest in Kepu to Fu for a consideration of RMB360,000 (approximately HK$450,000 or GBP37,000). Included within the sale was LED International (Far East) Limited, the immediate holding company of Kepu and a subsidiary of the Company in which the Company held 60 per cent. and in which Mr. Weng Xiao Yong holds the remaining 40 per cent. equity interest.

The proceeds of the sale of Kepu will be used to facilitate the Group's working capital and its EMC development plans.

LED!|s Chief Executive Officer, Stephen Chan, said: "I am pleased that we have been able to conclude the sale of our interest in Kepu. This will provide us with further resources to focus on our EMC business model which we feel is the right direction for the Company at present and will provide us with important recurring revenues."

Related party transaction

As Fu is the general manager and legal representative of Kepu, the disposal of Kepu constitutes a related party transaction pursuant to Rule 13 of the AIM Rules for Companies. The Company's directors, having consulted with the Company's nominated adviser, Allenby Capital Limited, consider that the terms of the disposal are fair and reasonable insofar as the Company's shareholders are concerned.

**Ends**

For further information:

 
 LED International Holdings Limited 
 Stephen Chan - Chief Executive Officer    [phone] 
 
 Allenby Capital Limited 
 Nick Naylor / Alex Price                  [phone] 
 
 

Notes to Editors:

LED International Holdings Limited and its subsidiaries specialize in the provision of EMC contracts under which the Group installs energy saving products in its customers' premises, including lighting and reactance filtering equipment supplied by the Group, and the subsequent savings made by the customers in their electricity charges are then shared between the Group and the customers thereby enabling the Group to generate recurring revenue rather than one-off sales revenue. Historically, the Group's business has been the development, manufacture and sale of low-powered light-emitting diode ("LED") display screens and modules.

Under EMC contracts, the Group provides energy efficiency solutions, including LED lighting, reactance filtering energy saving and other energy efficiency solutions.Specifically, the Group overhauls its customers' existing lighting and power consumption systems (which are based on traditional lighting technology and power generation equipment) with proprietary LED lighting products, reactance filtering equipment and other solutions provided by the Group. These energy efficiency products are installed in customers' premises. The Group bears all the upfront costs associated with the supply and installation of the energy efficiency solutions and these costs are then recouped by sharing in the monthly energy savings generated by the customers' use of the energy efficiency solutions over the period of the contracts. The Group receives revenue from customers on several different payment terms including on a pre-payment, monthly or quarterly basis.

For more information, please visit: http://www.led-intl.com

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