News blog
LED International
- BY: Andrew Hore |
- POSTED: 13/02/2009 |
LED International is selling its subsidiary Shenzhen China LED Photo Technology Ltd for RMB5m in cash and assets.
The purchaser is Tian Fu Kai Jia Information Company Ltd, which supplies advertising screens in tourist locations. It will pay LED 50% of any bad debts it collects. The assets being used to pay for the business are LED screens.
Tian Fu Kai Jia will pay a deposit of RMB100,000 within one month and the deal should be completed within six months. A general meeting will be required in order to allow LED shareholders to vote on the disposal.
Shenzhen China LED stopped manufacturing more than one year ago but it lost HK$587,000 in the year to June 2008. The company’s accounts were qualified because of inadequate accounting records.
LED made an increased loss in the year to June 2008. However, LED reported a profit thanks to a positive contribution from the waiver of debt. Increased competition, reduced demand from China and overseas and higher production costs all had an effect on the figures.
A new finance director should improve the financial controls of the business.
LED is trying to develop higher margin screens and reduce production costs. The focus will be on LED-based road lighting and speed signs.
The shares returned from suspension following the publication of LED’s figures for the year to June 2008. The share price declined by 0.125p to 0.25p, valuing LED at £490,000.
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