09:30     CHEVALIER INT'L<00025> - Announcement (4)                           

    Contribution                                                              
    It is agreed that the JV Partner will contribute a parcel of              
    land of approximately 14,788 sq. m. (subject to final                     
    confirmation of the relevant land department of the PRC                   
    government) which is estimated by the JV Partner at an amount             
    of RMB149.2 million (equivalent to approximately HK$140.8                 
    million), and will be contributed to this Xi Ling Project in              
    the form of shareholder's loan. Based on the Group's knowledge            
    in the Shenzhen property market and references to the                     
    comparable development projects in the nearby area, the                   
    Directors consider that such valuation for that parcel of land            
    is reasonable.                                                            
                                                                              
    The Group will contribute a shareholder's loan of RMB127.0                
    million (equivalent to approximately HK$119.8 million) to                 
    finance the Xi Ling Project. The entire amount will be financed           
    by internal resources of the Group. Such shareholder's loan               
    will be payable as to RMB77.0 million (equivalent to                      
    approximately HK$72.6 million) within one month after the issue           
    of its business license (as describe above) and as to RMB50.0             
    million (equivalent to approximately HK$47.2 million) within              
    one month after the issue of the relevant land use right of               
    this project (as describe above).                                         
                                                                              
    The JV Partner and the Group will respectively have an interest           
    of 54% and 46% in this project.                                           
                                                                              
    Profit sharing                                                            
    After arm's length negotiations between Citiway and the JV                
    Partner, and after taking into account that the Group will                
    provide management services relating to the Xi Ling Project,              
    it is agreed that the profit of the Xi Ling Project will be               
    shared between the Group and the JV Partner on a 50:50 basis.             
                                                                              
    Cui Tian Project                                                          
    Development                                                               
    A commercial/residential complex with a total gross floor area            
    of approximately 78,165 sq.m. will be developed in the Cui Tian           
    industrial village, LoWu, Shenzhen. The cost of the land where            
    the complex will be situated is estimated at approximately                
    RMB86.8 million (equivalent to approximately HK$81.9 million).            
    The total investment for the Cui Tian Project is yet to be                
    finalised as at the date of this announcement.                            
                                                                              
    Contribution                                                              
    It is stipulated that the contribution for Cui Tian Project               
    will be shared between the JV Partner and the Group on a 50:50            
    basis.                                                                    
                                                                              
    Profit Sharing                                                            
    The profit of the Cui Tian Project will be shared between the             
    Group and the JV Partner on a 50:50 basis.                                
                                                                              
    Reasons for the Proposed Investment                                       
    The principal activity of the Company is investment holding,              
    through its subsidiaries, the Group engaged in the business               
    of construction and engineering, insurance and investment,                
    property investment, hotel investment and information                     
    technology. The Joint Venture Company will principally                    
    undertake the Property Development Projects. The Directors                
    believe that the entering into of the Joint Venture Agreement             
    will create a good opportunity for the Group to benefit from              
    the growing property market in the PRC.                                   
                                                                              
    The Directors consider the terms of the Joint Venture Agreement           
    are fair and reasonable and the establishment of the Joint                
    Venture Company to undertake the Property Development Projects            
    is in the interest of the Company and the shareholders of the             
    Company.                                                                  
                                                                              
    GENERAL                                                                   
    The entering into of the Joint Venture Agreement constitutes              
    a discloseable transaction of the Company under the Listing               
    Rules. A circular containing further details of the Joint                 
    Venture Agreement will be despatched to the shareholders of               
    the Company as soon as practicable and in any event within 21             
    days from the publication of this announcement.                           
                                                                              
    The Directors have noted the recent increases in the price and            
    trading volume of the shares of the Company and wish to state             
    that they are not aware of any reasons for such increases.