10:21 TIAN AN<00028> - 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. TIAN AN CHINA INVESTMENTS COMPANY LIMITED (Incorporated in Hong Kong with limited liability) (Stock Code: 28) ANNOUNCEMENT CONNECTED TRANSACTIONS DISPOSALS OF TWO INDIRECT WHOLLY-OWNED SUBSIDIARIES On 30th December, 2004, Shine Star entered into the HY Sale and Purchase Agreement with SHKI and Hing Yip, pursuant to which (i) Shine Star agreed to sell and SHKI agreed to purchase the entire issued share capital of Hing Yip; and (ii) Shine Star agreed to assign and SHKI agreed to take as an assignment of the benefits of the HY Shareholder's Loan, at the aggregate consideration of RMB14,634,180 (equivalent to approximately HK$13,805,830) payable from SHKI to Shine Star. On 19th January, 2005, Shine Star entered into the SH Sale and Purchase Agreement with SHKI and Sing Hing, pursuant to which, conditional upon, among others, the obtaining of approval by the independent Shareholders in general meeting of the Company, (i) Shine Star agreed to sell and SHKI agreed to purchase the entire issued share capital of Sing Hing; and (ii) Shine Star agreed to assign and SHKI agreed to take as an assignment of the benefits of the SH Shareholder's Loan, at the aggregate consideration of RMB40,786,200 (equivalent to approximately HK$38,477,547) payable from SHKI to Shine Star. Hing Yip is an indirect wholly-owned subsidiary of the Company and is principally engaged in property investment in the PRC. It is wholly-owned by Shine Star. Upon completion of the HY Sale and Purchase Agreement, Hing Yip will become a wholly-owned subsidiary of SHKI. Sing Hing is an indirect wholly-owned subsidiary of the Company and is principally engaged in property investment in the PRC. It is wholly-owned by Shine Star. Upon completion of the SH Sale and Purchase Agreement, Sing Hing will become a wholly-owned subsidiary of SHKI. The Directors consider that the terms and conditions of the HY Sale and Purchase Agreement are fair, reasonable and on normal commercial terms and are in the interests of the Group and the Shareholders as a whole. The Directors (excluding the Independent Non-Executive Directors and the independent board committee who will obtain advice from the independent financial adviser to be appointed) consider that the terms and conditions of the SH Sale and Purchase Agreement are fair, reasonable and on normal commercial terms and are in the interests of the Group and the Shareholders as a whole. Since SHKI is a direct wholly-owned subsidiary of SHK, a Substantial Shareholder which holds an aggregate interest of approximately 48.6% directly and indirectly in the issued share capital of the Company, it is a connected person of the Company. As a result, the Sale and Purchase Agreements constitute connected transactions of the Company. Since the parties did not contemplate the SH Sale and Purchase Agreement when the HY Sale and Purchase Agreement was entered into, the Directors did not intend that the HY Sale and Purchase Agreement will be subject to the independent Shareholders' approval requirements under the Listing Rules. As a result, there is no condition in the HY Sale and Purchase Agreement that it is subject to the independent Shareholders' approval requirement. In view of the foregoing and as a matter of commercial decision of the Company, the Company will sell the 1st PRC Property irrespective of the outcome of the Shareholders' meeting in relation to the 2nd PRC Property. As the applicable percentage ratios of the HY Sale and Purchase Agreement are more than 0.1% but less than 2.5%, under Rule 14A.32(1) of the Listing Rules, it is only subject to reporting and announcement requirements and is exempt from the independent Shareholders' approval requirement. Details of the HY Sale and Purchase Agreement will be included in the Company's next published annual report and accounts in accordance with Rule 14A.45 of the Listing Rules. When the considerations receivable by the Company under the HY Sale and Purchase Agreement and the SH Sale and Purchase Agreement are being aggregated under Rules 14A.25 and 14A.26 of the Listing Rules, the entering of the SH Sale and Purchase Agreement is subject to the reporting, announcement and independent Shareholders' approval