Led International Holdings Regulatory News (LED)

 31 May 2016

LED International Holdings Limited

("LED" or the "Company")

Shareholders' agreement in relation to leasing finance company

and

update on suspension

Entry in to a shareholders' agreement with Shanghai Guang Dian Asset Management Company Limited

The board of directors of LED is pleased to announce that the Company has entered into an agreement with Shanghai Guang Dian Asset Management Company Limited ("SHGD") dated 27 May 2016 (the "Shareholders' Agreement"), under which LED and SHGD will make a total capital contribution of RMB200.0 million (being approximately £21.3 million) to Green Pearl Leasing (China) Company Limited ("GP Leasing"). GP Leasing is currently a 100% owned subsidiary of LED. The capital contribution shall be made by LED and SHGD in equal shares of RMB100.0 million (being approximately £10.7 million) each. LED's contribution shall be inclusive of the previous capital contributions made by LED, being approximately RMB16.5 million (being approximately £1.7 million). Further details of LED's previous capital contribution to GP Leasing are contained in the Company's announcement of 5 December 2014. LED intends to fund its approximately RMB83.5 million (being approximately £9.0 million) by raising the required relevant fund from the potential investors, including SHGD, within twelve months as stipulated in the Shareholders' Agreement SHGD's capital contribution will be by way of a cash investment in GP leasing, in return for which they will receive new shares in GP Leasing which represent 50% of GP Leasing's enlarged issued share capital.

GP Leasing was incorporated by LED in Shanghai, in the People's Republic of China (the "PRC") on 20 August 2013 with a registered capital of RMB100.0 million (being approximately £10.7 million) and is currently 100% owned by LED. GP Leasing engages in a range of business operations, including:

i) providing financing for leasing businesses;

ii) financing acquisitions of assets from outside the PRC for the purpose of leasing;

iii) maintaining and improving the depreciation values of the leasing assets;

iv) leasing related consultancy; and

v) guarantee services (in so far as are permitted by the laws and the administrative regulations).

LED's Chief Executive Officer, Stephen Chan, is currently one of three directors sitting on the board of directors of GP Leasing.

The board of directors of LED believes that by entering into the Shareholders' Agreement, LED will strengthen its strategic relationship with SHGD, thereby allowing LED to move into the business of leasing which would enhance LED's business operations and improve the long-term profitability of LED.

Background to SHGD

SHGD is incorporated in the PRC by contributing capital of RMB66.6 million (being approximately £* million) on 16 September 2015, and it is also a significant and established financing and asset management enterprise operating in the PRC fund management market. It is principally engaged in the business of corporate finance related advisory and consultancy services, and is known for its prudent approach in terms of risk management in relation to its investment portfolio. SHGD currently manages a portfolio of approximately RMB5.0 billion (being approximately £* million).

Mr. Yu Hong Xiang, the Legal Representative and director of SHGD, and Mr. Jin Yi Min, the supervisor of SHGD, owns 50 per cent. equity interest each in SHGD. The investment portfolio under management includes but is not limited to a private equity investment fund management firm in Qian Hai, Shenzhen, and some major equity stakes in listed firms at A-Stock of Shanghai Stock Exchange and National Equities Exchange and Quotations.

Summary of the Shareholders' Agreement

Suspension update

The Company's ordinary shares were suspended from trading on AIM on 22 December 2015, pursuant to AIM Rule 19. The suspension will remain in place until, inter alia, the Company's audited report and accounts for the year ended 30 June 2015 have been published and posted to Shareholders. The audit of the accounts for the year ended 30 June 2015 has commenced and the board of LED anticipates announcing these results in the next month or so. In addition, the Company is preparing its interim results for the period ended 31 December 2015.

**Ends**

For further information:

Notes to Editors:

LED International Holdings Limited and its subsidiaries specialize in the provision of EMC contracts under which the group (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