Vinda International : CONTINUING CONNECTED TRANSACTIONS - REVISION OF ANNUAL CAPS

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Vinda International Holdings Limited

維達國際控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 3331)

CONTINUING CONNECTED TRANSACTIONS - REVISION OF ANNUAL CAPS

Reference is made to the Announcements.

In view of the increase in demand by the Company for personal care products and raw materials under the Vinda Master Procurement Agreement, the Board expects that the Original Vinda Annual Caps may not be sufficient for the expected resultant changes to the amount of purchase monies payable by the Group to SCA Group Holding under the Vinda Master Procurement Agreement for the financial years ending 31 December 2017 and 31 December 2018. The Board therefore proposes to revise the Original Vinda Annual Caps under the Vinda Master Procurement Agreement for the years ending 31 December 2017 and 31 December 2018 to HK$300,000,000 and HK$300,000,000, respectively.

SCA Group Holding is a controlling shareholder of the Company and therefore a Connected Person of the Company. Since SCA Group Holding is entitled to exercise or control the exercise of approximately 36.16% of the voting power at the general meeting of Asaleo Care Limited, Asaleo Care Limited is also a Connected Person of the Company. Further, as Asaleo Care is a wholly-owned subsidiary of Asaleo Care Limited, Asaleo Care is also a Connected Person of the Company. Therefore, the transactions contemplated under the Asaleo Care Product Supply Agreement, the Vinda Master Procurement Agreement and the SCA Master Procurement Agreement, which are of a continuing nature, will constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules and will be aggregated as a series of transactions pursuant to Rule 14A.81 of the Listing Rules. Further, as the Board proposes to revise the Original Vinda Annual Caps under the Vinda Master Procurement Agreement, the Company is required to re-comply with the relevant provisions of Chapter 14A of the Listing Rules in respect of the continuing connected transactions thereunder pursuant to Rule 14A.54 of the Listing Rules.

As the applicable percentage ratios (as defined under the Listing Rules) calculated based on the Aggregated Annual Caps on an aggregated basis are more than 0.1% but less than 5%, the transactions contemplated under the Asaleo Care Product Supply Agreement, the Vinda Master Procurement Agreement and the SCA Master Procurement Agreement are subject to the reporting, announcement and annual review requirements, but are exempt from the independent shareholders' approval requirement under Chapter 14A of the Listing Rules.

BACKGROUND

Reference is made to the Announcements.

VINDA MASTER PROCUREMENT AGREEMENT

As disclosed in the Announcements, the Company entered into, among other things, the Vinda Master Procurement Agreement on 31 March 2016. Please refer to the Announcements for a summary of the principal terms of the Vinda Master Procurement Agreement.

In view of the increase in demand by the Company for personal care products and raw materials under the Vinda Master Procurement Agreement, the Board expects that the Original Vinda Annual Caps may not be sufficient for the expected resultant changes to the amount of purchase monies payable by the Group to SCA Group Holding under the Vinda Master Procurement Agreement for the financial years ending 31 December 2017 and 31 December 2018. The Board therefore proposes to revise the Original Vinda Annual Caps under the Vinda Master Procurement Agreement for the financial years ending 31 December 2017 and 31 December 2018 as set out further below.

Historical transaction amounts

For the two (2) years ended 31 December 2014 and 2015, there were transactions similar to those contemplated under the Vinda Master Procurement Agreement to the value of approximately HK$39,268,339 and HK$151,769,200, respectively. For the period from 31 March 2016 (i.e. effective date of the Vinda Master Procurement Agreement) to 31 December 2016 and the seven (7) months ended 31 July 2017, the transaction amounts under the Vinda Master Procurement Agreement were approximately HK$119,453,484 and HK$133,319,177, respectively.

Revised Vinda Annual Caps

On 5 September 2017, the Board proposed to revise the Original Vinda Annual Caps for the Vinda Master Procurement Agreement as follows:

Year ending 31 December

2017 HK$	2018 HK$
Original Vinda Annual Caps	200,000,000	200,000,000
Revised Vinda Annual Caps	300,000,000	300,000,000

Basis of determining the Revised Vinda Annual Caps

The Revised Vinda Annual Caps were determined by reference to the historical transaction values of similar transactions in the past, including under the Vinda Master Procurement Agreement, the expected rate of growth of the Group's sales and overall business and the agreed pricing pursuant to the Vinda Master Procurement Agreement.

SCA MASTER PROCUREMENT AGREEMENT

As disclosed in the Announcements, the Company entered into, among other things, the SCA Master Procurement Agreement on 31 March 2016. Please refer to the Announcements for a summary of the principal terms of the SCA Master Procurement Agreement.

Historical transaction amounts

For the two (2) years ended 31 December 2014 and 2015, there were transactions similar to those contemplated under the SCA Master Procurement Agreement to the value of approximately HK$29,086,804 and HK$24,797,151, respectively. For the period from 31 March 2016 (i.e. effective date of the SCA Master Procurement Agreement) to 31 December 2016 and the seven (7) months ended 31 July 2017, the transaction amounts under the SCA Master Procurement Agreement were approximately HK$135,202,246 and HK$66,669,674, respectively.

ASALEO CARE PRODUCT SUPPLY AGREEMENT

As disclosed in the Announcements, the Company entered into, among other things, the Asaleo Care Product Supply Agreement on 22 December 2016. Please refer to the Announcements for a summary of the principal terms of the Asaleo Care Product Supply Agreement.