Leoch International Establishes Joint Venture and Acquires Stake in Lead-acid Batteries Manufacturer

Capturing the Significant Growth Opportunity in Renewable Energy Industry

Further Expanding the Western China and Southeast Asia Market

HONG KONG, Dec. 20, 2010 /PRNewswire-Asia/ -- Leoch International Technology Limited ("Leoch International" or the "Company", Stock code: 842), a leading manufacturer and developer of lead-acid batteries in China, today announced that it has established a joint venture with Chengdu Shenhua Vehicle Industry Corporation Limited ("Shenhua Vehicle Industry"), the largest electric car brand in Chengdu. The Company will also acquire a 30% stake in a leading acid battery manufacturer in Malaysia. These two new investments represent the Company's further development in western China and Southeast Asia with cost advantage.

Established in Sichuan's Chengdu, a western city of China, the joint venture company will mainly be engaged in the production, assembly and sale of new motive power lead-acid batteries which do not contain cadmium. Leoch International will invest RMB20 million in the joint venture, with an 84.04% equity interest, while Shenhua Vehicle Industry will invest RMB3.8 million equipment, accounting for a 15.96% equity interest. Leoch International will provide technical support and working capital, while Shenhua Vehicle Industry will provide marketing and sales channels.

In addition, Leoch International selectively targets emerging markets with enormous development opportunities to increase penetration in developed markets. The Company will acquire a 30% stake in MSB MANUFACTURING SDN.BHD, the only industrial lead-acid battery manufacturer in Malaysia with 2009 sales revenue of MYR15 million and total assets of MYR9.9788 million at 2009 year end. After the acquisition, Leoch International will see Malaysia as a base for expanding the Southeast Asian market.

Leoch International, which aims to become the world's leading lead-acid battery manufacturer and developer, considers a focus on research and development crucial to maintaining its competitiveness. The Company has completed the production of pure lead batteries, the sample of which was proved to have attained international standards. That will become a new driver of profit of the Company.

Commenting on the joint venture and acquisition, Mr. Dong Li, Chairman of the Company, said, "With our experience in the global market and sales network in China, Leoch International has developed several growing businesses, such as automotive and renewable energy storage. The cooperation with Shenhua Vehicle Industry is an integration of technologies and channels, which not only enhances the Company's overall competitiveness, but also provides the Company with a great opportunity presented by the growing new energy sector. With its located in western China, the joint venture will let us take a strategic position in the region. I am very pleased to see the gradual development of Leoch International. In the future, we will further make use of the competitive strength to strengthen our leading position in China's new energy industry."

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