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VTech to Acquire US LeapFrog Enterprises

VTech Holdings Limited, a leader in electronic learning products and cordless telephones, and LeapFrog Enterprises, Inc, a developer of educational entertainment for children, today announces that the two companies have entered into a merger agreement whereby VTech will acquire LeapFrog.

VTech plans to acquire 100% of the outstanding common stock of LeapFrog through an all cash tender offer followed by a second-step merger. In the tender offer, VTech will offer LeapFrog investors US$1.00 per share for LeapFrog's Class A and Class B shares, which represents a 75.4% premium over the closing price of LeapFrog's Class A shares on 4 February 2016. The total purchase consideration amounts to approximately US$72 million. VTech will fund the tender offer through internal resources.

The tender offer is expected to commence on or about 3 March 2016, and will be open for a minimum of 20 business days. The closing of the transaction is subject to satisfaction of certain conditions set forth in the merger agreement, which has been unanimously approved by the Boards of Directors of both companies. LeapFrog's Board has agreed to unanimously recommend to its stockholders that they tender their shares of LeapFrog common stock pursuant to the tender offer.

Allan Wong, Chairman and Group CEO of VTech Holdings Limited said:

"We are delighted to have the LeapFrog brand joining VTech, bringing together two of the great names in children's learning and entertainment. VTech has been a pioneer in the electronic learning toy category for 35 years. The acquisition will allow us to offer the broadest portfolio of products that enhances the education and development of children across the world, while bringing them fun and joy."

Bill Chiasson, the Chairman of LeapFrog's Board of Directors added:

"We believe this is a terrific opportunity for our employees, customers, and shareholders. The acquisition and future investment by VTech will be instrumental to helping the LeapFrog brand achieve the mission of helping each child achieve their potential. Importantly, too, this transaction also rewards our shareholders with a significant premium from recent trading levels."

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