VTech Holdings has recovered about US$8 million by selling one of three factories in Mexico it bought as part of a US$113.32 million acquisition of loss-making assets from Lucent Technologies in March last year. The company, the world's largest indoor cordless-phone maker, has also accepted an offer for another Mexican factory which might fetch more than US$10 million, chairman Allan Wong said following yesterday's annual general meeting. When VTech announced its final results in late June, Mr Wong said the three Mexico factories could be sold for about US$40 million. VTech is in a legal dispute with United States telecommunications giant Lucent, which is expected to be heard in the middle of next year. VTech claimed that Lucent failed to disclose that sales of the acquired operations were lower than forecast and that inventory levels were too high compared with demand, resulting in excess inventory and under-utilisation of the Mexican plants. Mr Wong repeated VTech's expectations of booking a net profit this financial year after posting a record US$215 million loss in the year to March 31. VTech was planning to produce more than 10 million cordless-phones this year. He declined to disclose the planned mobile-phone production volume for the year, but said it would be very small, in view of the flood of handsets on the global market. 'When the European market's huge inventory becomes more or less cleared up, we would consider raising our production volume,' he said. Meanwhile, the company is in talks to sell intellectual properties owned by Sensei, a British mobile phone technology research firm it bought last year.