09:31     UPBEST GROUP<00335> - Announcement & Resumption (2)                 

    The Vendor is a company incorporated in British Virgin                    
    Islands. Mr. Cheng Kai Ming, Charles, an executive                        
    director of the Company, is one of the beneficiaries                      
    of a trust which assets include interests in the entire                   
    issued share capital of the Vendor. As at the date                        
    of this announcement, the Vendor holds 840,000,000                        
    Shares of the Company (representing 75% equity                            
    interest in the Company based on a total of                               
    1,120,000,000 Shares in issue)                                            
                                                                              
    Joint Placing Agents                                                      
    (a)   Sun Hung Kai International Limited, a deemed                        
    licensed corporation within the meaning of the SFO,                       
    and its ultimate beneficial owners are independent                        
    third parties not connected with the directors, chief                     
    executive or substantial shareholder of the Company                       
    or any of its subsidiaries or associates of any of                        
    them.                                                                     
                                                                              
    (b)   Upbest Securities Company Limited, a deemed                         
    licensed corporation within the meaning of the SFO.                       
    Upbest Securities Company Limited is a wholly owned                       
    subsidiary of the Company.                                                
                                                                              
    Sun Hung Kai International Limited and Upbest                             
    Securities Company Limited (together as "Joint                            
    Placing Agents")                                                          
                                                                              
    The Joint Placing Agents has in total agreed to procure                   
    purchaser for 108,754,000 Placing Shares on a fully                       
    underwritten basis.                                                       
                                                                              
    The structure of the Placing is determined after arm's                    
    length negotiation between the Company and the Joint                      
    Placing Agents.                                                           
                                                                              
    (2)   Number of Placing Shares                                            
    The Placing Shares (or the Top-Up Subscription Shares)                    
    of 108,754,000 Shares represent approximately 9.71%                       
    of the Company's existing share capital and                               
    approximately 8.85% of the issued share capital as                        
    enlarged by the Top-Up Subscription.                                      
                                                                              
    The 108,754,000 Placing Shares had been fully                             
    allocated to the Placees. Thus, Upbest Securities                         
    Company Limited does not have any commitment to take                      
    up any of the Placing Shares.                                             
                                                                              
    (3)   Placees                                                             
    The Placing Shares will be placed to not less than                        
    six Placees. It is expected that none of the Placees                      
    will become substantial shareholder of the Company                        
    immediately after the Placing.                                            
                                                                              
    (4)   Placing Price                                                       
    The Placing Price (or the Top-Up Subscription Price)                      
    of HK$1.42 represents (i) a discount of approximately                     
    18% to the closing price of the Shares of HK$1.73                         
    quoted on the Stock Exchange on 13 January 2005, being                    
    the date prior to the suspension; (ii) a discount of                      
    approximately 13% to the average closing price of the                     
    Shares of HK$1.64 quoted on the Stock Exchange for                        
    the five consecutive trading days immediately before                      
    and including 13 January 2005; and (iii) a discount                       
    of approximately 11% to the average closing price of                      
    the Shares of HK$1.59 quoted on the Stock Exchange                        
    for the ten consecutive trading days immediately                          
    before and including 13 January 2005.                                     
                                                                              
    The Placing Price was negotiated on arm's length basis                    
    between the Company and the Joint Placing Agents. The                     
    Board considers that the Placing Price is fair and                        
    reasonable based on current market conditions and in                      
    the interest of the Company and its shareholders as                       
    a whole. The gross proceeds from the Top-Up                               
    Subscription will be HK$154 million and net proceeds                      
    from the Top-Up Subscription of approximately HK$148                      
    million.                                                                  
                                                                              
    (5)   Independence of the Placing Agent and Placees                       
    The Sun Hung Kai International Limited and the Placees,                   
    being independent individual, corporation and /or                         
    institutional investors to be identified by the Joint                     
    Placing Agents, are independent third parties not                         
    connected with the directors, chief executive or                          
    substantial shareholders of the Company or any of its                     
    subsidiaries or associates of any of them. They are                       
    also independent and not connected with the Vendor                        
    or any person acting in concert with it.