Strengthening its Presence in the Personal Care Product
Business with an Investment of HK$123 Million

(16 December 2010 - Hong Kong) Vinda International Holdings Limited (“Vinda International” or the “Company”, together with its subsidiaries collectively known as the “Group”; stock code: 3331), one of the leading brands of tissue paper products manufacturers in the PRC, is pleased to announce that the Company has entered into an Investment and Shareholders’ Agreement (“Agreement”) with Fu An International Company Limited (“Fu An International”), Dynasty Fortune Partners and Cathay Capital Holdings II (collectively know as “Parties”), pursuant to which, the Company and the Parties have agreed to invest an aggregate of HK$300 million into V-Care Holdings Limited (the “Target Company” or “V-Care”) by way of subscription of all of its shares.

Pursuant to the Agreement, the Target Company will be held as to 41% by Vinda International which will invest in proportion a total of HK$123 million. Fu An International, the controlling shareholder of Vinda International will hold 39% stake, Dynasty Fortune LP and Cathay Capital Holdings II will hold 7% and 13% respectively. Vinda International owns the right to acquire further shareholding in the Target Company. In the event that the audited consolidated net profit and interest of the Target Company reaches HK$100 million in any financial year, the Company will have the right, to demand all the other Parties to sell to the Company their entire shareholding in the Target Company at a price of not less than ten (10) times price-to-earnings multiple of the audited consolidated net profit after tax as stated in the said audited financial statements. 

Commenting on the investment plan, Ms. Zhang Dong Fang, Chief Executive Officer of the Group, said, “Vinda International has a long-term goal of expanding into products other than tissue paper. In August, 2010, we announced a plan to invest in a company engaged in the production and distribution of disposable diapers and sanitary napkins under its own brandname in China. In light of the enormous market demand and development potential for personal care products in China, we finally decided to form a larger investment platform via the formation of “V-Care”. Through this platform, we will, on the one hand, continue the original plan of developing our own brand and producing personal care products including disposable diapers and sanitary napkins. On the other hand, we will invest in or acquire personal healthcare companies with promising future through the Target Company when opportunities arise. Riding on our extensive sales network, we are confident in creating synergies and enhancing operation efficiency of those acquired enterprises.”

“Through our experiences in marketing and brand management of fast-moving consumer goods, we are confident in achieving win-win situation with the potential acquisition target while gradually branching out into other areas of personal healthcare products. To satisfy our customers’ demand, the Group will launch and develop new products actively with a view to offering desirable tissue paper products and personal care products for a crowd of customers in pursuit of quality life. This will in turn generate satisfactory returns for our investors.”