09:50     SHELL ELECTRIC<00081> - Announcement (4)                            

    2002, the registered capital of which is US$5 million.                    
    Its business scope includes the development,                              
    construction, sale, leasing and management of                             
    self-constructed commercial buildings and ancillary                       
    facilities in accordance with the relevant government                     
    approval. Pursuant to a supplemental joint venture                        
    contract dated 3 January 2005 entered into between                        
    the PRC party to the PRC Joint Venture and Yue Tian                       
    and subject to the approval by the relevant                               
    governmental authority in the PRC, the PRC party to                       
    the PRC Joint Venture will be entitled to a fixed sum                     
    of RMB90 million (equivalent to approximately                             
    HK$84,905,660) in return for its contribution to the                      
    development of the PRC Joint Venture. Upon payment                        
    of such amount, the entire revenue of the PRC Joint                       
    Venture will be retained by Yue Tian.                                     
                                                                              
    The PRC Joint Venture is in the process of acquiring                      
    a land located at Guangzhou, the PRC from the PRC party                   
    to the PRC Joint Venture for the construction, fitting                    
    out and furnishing of a five-star hotel and grade "A"                     
    office premises and shopping arcade adjoining the                         
    hotel ("Development Project").                                            
                                                                              
    As at the date of this announcement, the Purchasers                       
    estimate that the size of the Development Project will                    
    amount to approximately HK$1.2 billion, of which 50%                      
    is expected to be financed by shareholders' equities                      
    or shareholders' loans and 50% to be financed by bank                     
    loans. On the basis of 20% interests in Yue Tian held                     
    by Allright Investments immediately after Completion                      
    and barring any unforeseen circumstances, the                             
    Directors expect that the shareholders' equities or                       
    shareholders' loans to be contributed by Allright                         
    Investments to the Development Project will be                            
    approximately HK$120 million.                                             
                                                                              
    The audited net loss both before and after taxation                       
    of the PRC Joint Venture for the period from 1 January                    
    2003 to 31 December 2003 was approximately RMB296,330                     
    (equivalent to approximately HK$279,557) based on the                     
    PRC generally accepted accounting principles. Based                       
    on the management accounts of the PRC Joint Venture                       
    for the 12 months ended 31 December 2004, the                             
    unaudited net loss and unaudited net asset value of                       
    the PRC Joint Venture were approximately RMB3,680,429                     
    (equivalent to approximately HK$3,472,103) and                            
    RMB28,882,994 (equivalent to approximately                                
    HK$27,248,108) respectively.                                              
                                                                              
    REASONS FOR AND BENEFITS OF THE ACQUISITION                               
                                                                              
    The principal business of the Group are the                               
    manufacturing and marketing of electrical household                       
    appliances and investments in property and high                           
    technology businesses.                                                    
                                                                              
    The Group currently owns property investment                              
    portfolio in Tian He District, Guangzhou, the PRC.                        
    The Board is of the view that there is a positive                         
    prospect for property investment in that area. It is                      
    expected that the Development Project will contribute                     
    positively to the future development of the Group                         
    through the broadening of the property portfolio and                      
    the income base of the Group.                                             
                                                                              
    The Directors, including the independent                                  
    non-executive Directors, consider that the terms and                      
    conditions of the Acquisition Agreement and the Loan                      
    Agreement are on normal commercial terms and are fair                     
    and reasonable as far as the Shareholders as a whole                      
    are concerned.