09:56     WHARF HOLDINGS<00004> - Announcement (5)                            

    PSCL has reviewed, among other things, the Tenancy                        
    Agreements and also the previous tenancy agreements for                   
    the two premises which were entered into between the same                 
    parties (the "Previous Tenancies").  Furthermore, PSCL                    
    has reviewed several existing agreements of Other Relevant                
    Group's Tenancies and Other Relevant CS Tenancies, together               
    with copies of the Outside Parties' Leases, all being in                  
    relation to retail and/or supermarket premises of                         
    comparable size and for durations of more than three years.               
    A summary of the review by PSCL of the abovementioned                     
    documents is illustrated in the table below:                              
                                                                              
               Nature of                Duration of                           
               documents                the tenancy agreements                
    1. The Tenancy Agreements           4 years and 9 months                  
                                        to 6 years and 10 months              
    2. The Previous Tenancies           6 years                               
    3. Other Relevant Group's Tenancies 6 years                               
    4. Other Relevant CS Tenancies      6 years to 9 years                    
    5. Outside Parties' Leases          6 years                               
                                                                              
    As shown in the above table, the duration of the                          
    respective tenancy agreements reviewed generally                          
    exceeds the three-year period as prescribed in paragraph                  
    14A.35(1) of the Listing Rules and ranges from 6 years                    
    to 9 years which are generally in line with the duration                  
    of the Tenancy Agreements.                                                
                                                                              
    Following such review, PSCL has opined, inter alia, that                  
    being an upmarket retail store operator in Hong Kong,                     
    there is undoubtedly a need for City Super to have                        
    substantial investment requirements for its retail store                  
    premises at the initial stage and also on an ongoing                      
    basis.  This will include extensive designs,                              
    refurbishments, renovations, staff recruitment and                        
    ongoing training.  In view of this, the need on the part                  
    of City Super to have longer term business plans and                      
    projections thereby necessitating, amongst other things,                  
    longer duration of tenancy agreements of its retail                       
    premises is reasonable as tenancies of a short duration                   
    might give rise to business uncertainties and may be                      
    commercially disadvantageous to City Super.  In the                       
    light of the above, PSCL is of the opinion that the                       
    duration of the Tenancy Agreements, being each                            
    individually in excess of three years, is justifiable                     
    and is in the normal business practice for contracts of                   
    this type to be of such duration.                                         
                                                                              
    GENERAL                                                                   
                                                                              
    As the aggregate Annual Rents receivable by TSL and WRL                   
    and also the aggregate Annual Cap Amounts under the                       
    Tenancy Agreements for any one of the relevant financial                  
    years of the Company represent less than 2.5% of the                      
    applicable percentage ratios of the Company, no                           
    independent shareholders' approval is required.                           
    Particulars of the Agreements, particularly the Tenancy                   
    Agreements which constitute continuing connected                          
    transactions, will be disclosed in the annual report and                  
    accounts of the Company for the year ended 31st December,                 
    2004 and, where applicable, for each of the relevant                      
    subsequent financial years in accordance with Rule                        
    14A.46 of the Listing Rules.                                              
                                                                              
    As at the date of this announcement, the board of                         
    directors of the Company comprises Mr. Peter K. C. Woo,                   
    Mr. Gonzaga W. J. Li, Mr. Stephen T. H. Ng,                               
    Mr. David J. Lawrence, Mr. Paul M. P. Chan,                               
    Professor Edward K. Y. Chen, Mr. Paul M. F. Cheng,                        
    Dr. Raymond K. F. Ch'ien, Mr. Erik B. Christensen,                        
    The Hon. Vincent K. Fang, Mr. Hans Michael Jebsen,                        
    Mr. Christopher P. Langley, Mr. Quinn Y. K. Law,                          
    Ms. Doreen Y. F. Lee, Mr. T. Y. Ng and                                    
    Mr. James E. Thompson.                                                    
                                                                              
    By Order of the Directors                                                 
    Wilson W. S. Chan                                                         
    Company Secretary                                                         
                                                                              
    Hong Kong, 5th January, 2005