VTH Vtech Hldgs.

RNS Number:7334U
Vtech Holdings Limited
12 April 2007

VTech Holdings Limited
(Incorporated in Bermuda with limited liability)
(Stock Code: VTH)

Continuing Connected Transaction


On 11 April 2007, the Company and Aldenham entered into the Lease which
constitutes a continuing connected transaction (the "Transaction") of the
Company under Rule 14A.34 of the Listing Rules and shall be disclosed by way of
an announcement.


Brief details of the Transaction will also be disclosed in the Company's
subsequent published annual report and accounts for each of the relevant
financial years ending 31 March 2008 and 2009 in accordance with the
requirements under the Listing Rules.


I.      The Transaction


Reference is made to the Previous Leases of the Premise as disclosed in the
announcements of the Company dated 6 April 2005 and 11 April 2003. As the
Previous Lease dated 1 April 2005 expired on 31 March 2007, on 11 April 2007,
the Company as tenant entered into the Lease with Aldenham as landlord. The
principal terms of the Lease remain the same as those in the Previous Leases and
are as follows:


Date        :        11 April 2007

Landlord    :        Aldenham

Tenant      :        the Company

Premise     :        approximately 5,673 square feet of 29th and 30th Floors, 12
                     Bowen Road, Hong Villa, Hong Kong

Terms       :        2 years commencing 1 April 2007 and expiring on 31 March
2009

Rent        :        HK$250,000 per month (inclusive of rates and management
                     fees) in the aggregate amount of HK$6,000,000, to be paid 
                     monthly in arrears


Aldenham is an indirect wholly-owned subsidiary of a trust in which the family
members of Mr. Allan WONG Chi Yun, a director, chief executive officer and
substantial shareholder holding directly and indirectly 40.03% of the entire
issued share capital of the Company, are the beneficiaries. Aldenham is
therefore a connected person of the Company as ascribed by the Listing Rules and
the Lease constitutes a continuing connected transaction under the Listing
Rules.


The Board (including the independent non-executive directors) are of the view
that the Lease is entered into upon normal commercial terms which are fair and
reasonable and is in the interest of the Company and its independent
shareholders. The rental was determined by reference to a valuation report
conducted by an independent qualified surveyor when the Premise was leased to
the Company in 2003 and also by having regards to informal enquiries made by the
Company as to rental prices for similar premises. In particular, enquiries were
directed to premises of similar nature and location (e.g. neighbouring
buildings) to that of the Premise. The current rental amount is the same amount
as that paid for during the term of the Previous Leases.


II.     Reasons for the Lease


The Premise was leased for the purposes of providing housing to Mr. Allan WONG
Chi Yun in accordance with the terms of his service contract. Mr. Allan WONG Chi
Yun's service contract provides that the Company shall pay for him the monthly
rental of his residence during the continuance of his service with the Company.
The entering into of the Lease shall not additionally increase the total
emoluments entitled by Mr. Allan WONG Chi Yun but is an incentive used for the
retention of his service as an employee of the Company.


III.   General


The Group is principally engaged in the business of the design, manufacture and
distribution of electronic learning products and telecommunication products. The
principal activity of Aldenham is property investment.


The maximum aggregate annual value of the transaction is HK$3 million,
calculated on the basis of the yearly rent. The Board considers that this annual
cap for the years ending 31 March 2008 and 31 March 2009 is fair and reasonable.
Since the total rental value receivable by Aldenham under the Lease represents
less than 2.5% of the applicable percentage ratios of the Company under Rule
14A.34 of the Listing Rules and accordingly, no independent shareholder's
approval is required. Details of the Transaction shall be disclosed by way of an
announcement and to be included in the Company's subsequent published annual
report and accounts of each of the relevant financial years in accordance with
Rules 14A.45 and 14A.46 of the Listing Rules. There are no previous transactions
between the Group and Aldenham or its ultimate beneficial owners which require
aggregation under Rule 14A.25 of the Listing Rules.


As at the date of this announcement, the Board of Directors of the Company
comprises:


Executive Directors                  :        Allan WONG Chi Yun
                                              Edwin YING Lin Kwan
                                              PANG King Fai

Independent Non-executive Directors  :        Raymond CH'IEN Kuo Fung
                                              William FUNG Kwok Lun
                                              Michael TIEN Puk Sun
                                              Patrick WANG Shui Chung



Definitions:


Unless otherwise defines, the following terms used in this announcement shall
have the following meanings:


"Aldenham"              Aldenham Company Limited, a company incorporated in Hong
                        Kong;


"Company"               VTech Holdings Limited, a company incorporated in
                        Bermuda, the shares of which are listed on The Stock 
                        Exchange of Hong Kong Limited and The London Stock 
                        Exchange plc;


"Board"                 the board of directors of the Company;


"Group"                 the Company and its subsidiaries;


"Lease"                 the lease of the Premise pursuant to an agreement
                        between Aldenham and the Company dated 11 April 2007;


"Premise"               the premise at 29th and 30th Floor, 12 Bowen Road,
                        Hong Villa, Hong Kong;


"Previous Leases"       the leases of the Premise pursuant to agreements between
                        Aldenham and the Company dated 1 April, 2005 and 11 
                        April 2003 respectively, as disclosed in announcements 
                        of the Company dated 6 April 2005 and 11 April 2003
                        respectively;


"Listing Rules"         The Rules Governing the Listing of Securities on The
                        Stock Exchange of Hong Kong Limited.



By Order of the Board
VTech Holdings Limited
CHANG Yu Wai
Company Secretary


Hong Kong, 11 April 2007


Website: http://www.vtech.com




                      This information is provided by RNS
            The company news service from the London Stock Exchange
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