09:30     SKYNET(INTL GP)<00577> & PAUL Y-ITC<00498> - J. Ann. (3)            

    3.   UNDERWRITING ARRANGEMENTS                                            
    Based on the results of the Open Offer referred to above, the Open        
    Offer was under-subscribed by 38,226,317 Offer Shares ("Shortfall         
    Offer Shares"). Pursuant to the Underwriting Agreement, Paul Y            
    has subscribed for all the Shortfall Offer Shares. The Shortfall          
    Offer Shares represent approximately 84.8% of the Offer Shares            
    and approximately 6.6% of Paul Y. Engineering's enlarged issued           
    share capital of 576,699,394.8 Consolidated Shares immediately            
    after completion of the Open Offer, Acquisition Agreement and             
    Hidden Agreement. All subscription monies for the Shortfall Offer         
    Shares have been received by Paul Y. Engineering as of the date           
    of this announcement.                                                     
                                                                              
    4.   SHARE CERTIFICATES                                                   
    Share certificates for the Offer Shares will be despatched by             
    ordinary post to the Shareholders, at their own risk, to the              
    address specified in the register of members of Paul Y.                   
    Engineering on Wednesday, 19th January, 2005.                             
                                                                              
    5.   COMPLETION OF THE RESTRUCTURING PROPOSAL                             
    With completion of the Acquisition Agreement and the Hidden               
    Agreement having taken place on Monday, 17th January, 2005, the           
    Restructuring Proposal was also completed and fully implemented.          
                                                                              
    6.   SHAREHOLDING STRUCTURE OF PAUL Y. ENGINEERING                        
    The following is a summary of the shareholding structure of Paul          
    Y. Engineering before and upon completion of the Restructuring            
    Proposal:                                                                 
                                                                              
    Shareholder                                                               
    Shareholding before completion of the Restructuring Proposal              
    Shareholding upon completion of the Restructuring Proposal                
       Consolidated Shares   %   Consolidated Shares   %                      
                                                                              
    Paul Y   -   -   531,826,317.0   92.2                                     
    PCPD (Note)   4,080,146.0   22.6   4,080,146.0   0.7                      
    Wellington   -   -   20,000,000.0   3.5                                   
    Other public Shareholders   13,948,253.8   77.4   20,792,931.8            
    3.6                                                                       
                                                                              
    Total   18,028,399.8   100.00   576,699,394.8   100.00                    
                                                                              
    Note:   PCPD is treated as public shareholder upon completion of          
    the Restructuring Proposal.                                               
                                                                              
    Undertaking from Paul Y                                                   
    Paul Y has given an undertaking to the Stock Exchange to place            
    out its shareholding interest in Paul Y. Engineering or to do or          
    to procure Paul Y. Engineering to do any other acts (subject to           
    compliance with the Listing Rules) which are considered                   
    appropriate to restore the public float of Paul Y. Engineering            
    to not less than 25%. Further announcement will be made in this           
    regard.                                                                   
                                                                              
    7.   APPOINTMENT OF DIRECTORS OF PAUL Y. ENGINEERING                      
    With immediate effect after completion of the Restructuring               
    Proposal on 17th January, 2005, the following have been appointed         
    as directors of Paul Y. Engineering:                                      
                                                                              
    Mr. Ronald James Blake   :   Chairman, Independent Non-Executive          
    Director and                                                              
       Chairman of the Audit Committee                                        
    Mr. Lau Ko Yuen, Tom   :   Deputy Chairman and Non-Executive              
    Director                                                                  
    Mr. Wong Wing Hoo, Billy   :   Managing Director and Executive            
    Director                                                                  
    Mr. Lee Hon Chiu   :   Executive Director                                 
    Mr. Lee Chack Fan   :   Independent Non-Executive Director and            
       member of the Audit Committee                                          
    Mr. Iain Ferguson Bruce   :   Independent Non-Executive Director          
    and                                                                       
       member of the Audit Committee                                          
                                                                              
    Set out below are the biographies and background information of           
    the directors of Paul Y. Engineering appointed:                           
                                                                              
    Mr. Ronald James Blake, OBE, JP, aged 70, qualified as a Chartered        
    Engineer in 1960 and was awarded the Institution of Civil                 
    Engineers Gold Medal in 1997. He was President of the Hong Kong           
    Institution of Engineers between 1991 and 1992 and later became           
    President of the Federation of Engineering Institutions of South          
    East Asia and the Pacific (FEISEAP), having served as a member            
    of the Executive for three years.