10:31     KINGBOARD CHEM<00148>E&E INT'L<00033>-J.Ann&Suspend<00033>-3        

    acceptance under the Hong Kong Option Offer in respect                    
    of 22,000,000 E&E Options had also been received,                         
    representing 100% of the outstanding E&E Options                          
    granted under the share option scheme of E&E adopted                      
    on 29 October 2001. As at the date of the Offer                           
    Announcement, the Hong Kong Offeror and parties                           
    acting in concert with it were interested in an                           
    aggregate of 336,799,000 E&E Shares, representing                         
    approximately 27.50% of the entire issued share                           
    capital of E&E as at the date of the Offer Announcement.                  
    The Company, being a concert party of the Hong Kong                       
    Offeror, has acquired an aggregate of 1,645,000 E&E                       
    Shares at a price of HK$1.90 per E&E Share on the market                  
    during the period from 30 December 2004 up to and                         
    including the date of this announcement. Taking into                      
    account the valid acceptances under the Hong Kong                         
    Share Offer, the Hong Kong Offeror and parties acting                     
    in concert with it are interested in 1,166,629,764                        
    E&E Shares, representing approximately 95.26% of the                      
    entire issued share capital of E&E as at the date of                      
    this announcement.                                                        
                                                                              
    PRIVATIZATION OF E&E                                                      
    As disclosed in the Privatization Announcement, the                       
    Company and the Hong Kong Offeror have decided to                         
    privatize E&E and to effect the compulsory                                
    acquisition under the Companies Act of E&E Shares held                    
    by E&E Shareholders who have not accepted the Hong                        
    Kong Share Offer pursuant to Rule 6.15 of the Listing                     
    Rules.                                                                    
                                                                              
    As the Hong Kong Offeror and parties acting in concert                    
    with it hold in aggregate more than 95% of the issued                     
    share capital of E&E, the Hong Kong Offeror has the                       
    right and will exercise such right to compulsorily                        
    acquire the E&E Shares held by shareholders who have                      
    not accepted the Hong Kong Share Offer, at the price                      
    of HK$1.90 per E&E Share, in accordance with and                          
    subject to section 103 of the Companies Act.                              
                                                                              
    The exercise of such right of compulsory acquisition                      
    is in compliance with Rule 2.11 of the Takeovers Code                     
    as acceptance of the Hong Kong Share Offer and                            
    purchases by the Company after the posting of the Hong                    
    Kong Offer Document total more than 90% of the issued                     
    share capital of E&E, other than those owned by the                       
    Hong Kong Offeror and parties acting in concert with                      
    it as at the date of the Hong Kong Offer Document.                        
                                                                              
    The Hong Kong Offeror will commence the procedures                        
    for compulsory acquisition of the E&E Shares from all                     
    the E&E Shareholders who have not accepted the Hong                       
    Kong Share Offer as soon as possible in accordance                        
    with and subject to section 103 of the Companies Act.                     
                                                                              
    SUSPENSION OF TRADING                                                     
    As disclosed in the Offer Announcement and the Offer                      
    Document, if the level of acceptances reach the                           
    prescribed level under the Companies Act and Rule 2.11                    
    of the Takeovers Code permits a compulsory                                
    acquisition and the Hong Kong Offeror proceeds with                       
    the privatization of E&E, dealings in the securities                      
    of E&E will be suspended from the Closing Date up to                      
    the withdrawal of listing of E&E's securities from                        
    the Stock Exchange pursuant to Rule 6.15 of the                           
    Listing Rules. In this connection, E&E has applied                        
    for suspension of trading of E&E Shares with effect                       
    from 9:30 a.m. on 7 January 2005. Upon the acquisition                    
    of all the E&E Shares by the Hong Kong Offeror and                        
    parties acting in concert with it, E&E will apply to                      
    the Stock Exchange for withdrawal