HONG KONG, Nov.28 /Xinhua-PRNewswire/ --
DVN (HOLDINGS) LIMITED
(incorporated in Bermuda with limited liability)
(STOCK CODE: 500)
The Company is pleased to announce that on 28 September 2006, a wholly-
owed subsidiary of the Company has entered into a non-legally binding letter
of intent to establish a joint venture company to develop the digital
broadcasting business in Nanchong City in Sichuan of the PRC.
THE JOINT VENTURE
The Company is pleased to announce that on 28 September 2006, a wholly-
owed subsidiary of the Company ("DVNS") has entered into a non-legally
binding letter of intent ("LOI") with Nanchong City Broadcasting TV Network
Transmission Centre ("NCBN"), an independent third party not connected with
the Directors, chief executives or substantial shareholders of the Company
or any of its subsidiaries, or their respective associates, to establish a
joint venture company to develop the digital broadcasting business in
Nanchong City, Sichuan of the People's Republic of China ("PRC").
Pursuant to the terms of the LOI, the parties intend to establish a
joint venture ("JV") which will be owned as to 49% by DVNS and 51% by NCBN.
It is intended that NCBN will inject the relevant rights of the network,
equipment and etc. and the Group will be responsible to provide the platform
and equipment for the integration of digital broadcasting in such network.
NCBN will also be responsible to procure the JV to become the exclusive
operator to provide digital broadcasting and related services to Nanchong
City and obtain all approvals from the relevant government authorities.
Final terms of the agreement to establish the JV will be subjected to
further negotiation and the Company will make necessary disclosure according
to the Listing Rules when appropriate.
INFORMATION OF THE COMPANY
The Company is the leading provider of digital TV broadcasting systems
integrator and terminal products in the PRC. It has installed more than 40
digital broadcasting systems and its patented products have been extensively
deployed. In 2005, the Company cooperated with the Qingdao City Radio and
Television Bureau to migrate the entire city to digital, building the
first "model city" in digital broadcasting in the PRC. The Company also
scored success in shifting Foshan to digital broadcasting. In 2006, the
Company achieved further success in migrating Guangxi to fully digitalized
and making Guangxi the first "digitalization model" at the provincial
level. The Company's set-top boxes have received license from China's State
Administration of Radio Film and Television ("SARFT") and are widely adopted
in the PRC market. The Group generates its revenues from the sales of set
top boxes, broadcasting platforms, subscription fees and related services.
REASON OF FORMING THE JV
Nanchong City has a population of approximately 7,300,000 with 400,000
cable TV subscribers, and it has network coverage of at least 800,000
households in various counties, implying an ample market room for growth.
As part of the ordinary course of business of the Group, the Group always
wishes to expand its coverage and market share in different areas in China.
Pursuant to the terms of the LOI, DVNS will be compensated for its sales of
the set-top boxes to the cable operators and end-users by having a share in
the monthly subscription fee paid by the end-users. Also, the Group shall
be able to share the revenue from the value added services provided to the
end-users.
The Company will continue to develop its digital broadcasting business
in other provinces with similar business model and will seek ways to
strengthen its capital base and financial position, in order to facilitate
its rapid roll-out of TV digitalization in China.
As at the date of this announcement, the Board comprises Mr. Ko Chun
Shun, Johnson, Mr. Lui Pan, Terry, Mr. Luo Ning, Mr. Qiu Yiyong, Mr. Jin
Wei, Mr. Wang Daoyi and Mr. Hu Qinggang (each of whom is an executive
Director) and Mr. Shaw Sun Kan, Gordon, Mr. Jerry Sze, and Mr. Itzhak
Shenberg (each of whom is a non-executive Director), and Mr. Chu Hon Pong,
Mr. Liu Tsun Kie and Mr. Yap Fat Suan Henry (each of whom is an independent
non-executive Director).
By order of the Board
DVN (Holdings) Limited
Johnson Ko Chun Shun
Chairman
Hong Kong, 27 November 2006
Note: This announcement is issued as supplementary information to the
press release titled "DVN to Migrate Nanchong in Sichuan to Digital
Leveraging on Innovative Business Model to Further Expand Leadership in
China Digital TV Market" by DVN (HOLDINGS) LIMITED issued on the same day.