Annual Report 2007 - Hmdatalink.com hm datalink

Notes to the consolidated financial statementsfor the year ended 31 December 200725. MAJOR NON-CASH TRANSACTIONDuring the year, 449,694,954 (2006: 31,123,594) ordinary shares were issued upon conversion of convertiblebonds and were satisfied by transferring HK$437,441,000 (2006: HK$28,178,000) from respective liability andembedded derivative components of the convertible bonds to share capital and share premium accordingly.26. COMMITMENTSCapital expenditure commitmentsDuring the year, the Group entered into agreements with various connected persons to acquire 44.19% ofthe remaining interests in each of the PRC associates from its respective controlling shareholder and itsassociates at the total consideration of approximately HK$1,611 million to be satisfied fully by the issue of1,288,672,000 ordinary shares of the Company of nominal value of HK$0.02 each at HK$1.25 per share. Theacquisitions have been approved by the independent shareholders of the Company and at the date of issueof these consolidated financial statements, the acquisitions have not yet been completed. In addition, capitalcommitments contracted for but not provided for, net of deposits paid, in respect of plant and machineryoutstanding as at 31 December 2007 amounted to HK$70,679,000 (2006: Nil).During the year ended 31 December 2006, the Company entered into a contract with a related party toestablish a sino-foreign equity joint venture in the PRC in which the Company would invest approximatelyHK$418,580,000.Operating lease commitmentsAt the balance sheet date, the Group had commitments for future minimum lease payments in respect ofoffice and factory premises under non-cancellable operating leases which fall due as follows:2007 2006HK$’000HK$’000Within one year 2,101 926In the second to fifth year inclusive 2,815 –4,916 926Leases are negotiated and rental are fixed for an average term of two years.GEELY AUTOMOBILE HOLDINGS LIMITED94ANNUAL REPORT 2 0 0 7