09:50     WAI YUEN TONG<00897> - Announcement (1)                             

    The Stock Exchange of Hong Kong Limited takes no responsibility           
    for the contents of this announcement, makes no representation            
    as to its accuracy or completeness and expressly disclaims any            
    liability whatsoever for any loss howsoever arising from or in            
    reliance upon the whole or any part of the contents of this               
    announcement.                                                             
                                                                              
    WAI YUEN TONG MEDICINE HOLDINGS LIMITED                                   
    (incorporated in Bermuda with limited liability)                          
    (Stock code: 897)                                                         
                                                                              
    PLACING OF EXISTING SHARES AND                                            
    TOP-UP SUBSCRIPTION OF NEW SHARES                                         
                                                                              
    PLACING AGENT                                                             
                                                                              
    Kingston Securities Limited                                               
                                                                              
    On 20 January 2005, the Vendor entered into the Placing Agreement         
    and the Subscription Agreement with the Placing Agent and the             
    Company respectively. Pursuant to the Placing Agreement, the              
    Vendor has agreed to place, through the Placing Agent,                    
    552,000,000 Placing Shares, on a fully underwritten basis, to             
    not less than six independent placees who are independent                 
    individual, corporate and/or institutional investors, and their           
    ultimate beneficial owners will not be connected person(s) (as            
    defined in the Listing Rules) of the Company, at a price of               
    HK$0.065 per Share. Pursuant to the Subscription Agreement, the           
    Vendor conditionally agreed to subscribe for 552,000,000                  
    Subscription Shares at a price of HK$0.065 per Share.                     
                                                                              
    The Placing Shares (or the Subscription Shares) represent i)              
    about 19.97% of the existing issued share capital of the Company          
    of 2,763,869,225 Shares; and ii) about 16.65% of the Company's            
    issued share capital as enlarged by the Subscription. The                 
    Subscription is conditional upon (1) the Listing Committee of             
    the Stock Exchange granting listing of, and permission to deal            
    in, the Subscription Shares; and (2) the completion of the                
    Placing.                                                                  
                                                                              
    The net proceeds from the Subscription of about HK$34.8 million           
    will be used as to (i) HK$10 million for opening new retail shops;        
    (ii) HK$10 million for the repayment of bank borrowings; and              
    (iii) HK$14.8 million for general working capital.                        
                                                                              
    Shareholders should note that completion of the Subscription              
    Agreement is conditional. Shareholders and potential investors            
    should exercise caution when dealing in the Shares.                       
                                                                              
                                                                              
    THE PLACING AGREEMENT DATED 20 JANUARY 2005                               
                                                                              
    Parties involved                                                          
                                                                              
    The Placing Agreement was entered into between the Vendor and             
    the Placing Agent.                                                        
                                                                              
    Placing Agent                                                             
                                                                              
    Kingston Securities Limited is the Placing Agent and will receive         
    a placing commission of 2.5% on the gross proceeds of the Placing         
    payable by the Company upon completion of the Placing, which              
    was arrived at after arm's length negotiations between the                
    Company and the Placing Agent.                                            
                                                                              
    The Placing Agent is independent of and not connected with the            
    Company and its connected persons (as defined in the Listing              
    Rules).                                                                   
                                                                              
    Placees