12:04     LUEN THAI<00311> - Announcement (4)                                 

    The Placing Price and the Subscription Price were                         
    determined after arm's length negotiations between                        
    the Company, Capital Glory Limited and the Placing                        
    Agent and the Directors consider that the terms of the                    
    Placing Price and the Subscription Price are fair and                     
    reasonable. The existing Shares were listed on the                        
    Main Board of the Stock Exchange on 15 July, 2004. Net                    
    proceeds of approximately HK$640 million were raised                      
    from the listing. However, none of the proceeds raised                    
    at the listing was earmarked for the purposes of                          
    financing the expansion of the Group's existing                           
    product types, such as ladies' intimate wear, knitwear                    
    and cotton pants, and therefore the Directors believe                     
    that the Placing and the Subscription are in the best                     
    interests of the Company and the Shareholders as a                        
    whole. The Directors are of the view that the Placing                     
    and Subscription will enlarge the Shareholder base and                    
    the capital base of the Company.                                          
                                                                              
    USE OF PROCEEDS                                                           
    All the commission, cost, and expenses incurred in                        
    relation to the Placing and Subscription will be borne                    
    by the Company and the interest accrued on the net                        
    Placing proceeds from the date of completion of                           
    Placing to the date of completion of the Subscription                     
    will be for the benefit of the Company.                                   
                                                                              
    The net proceeds of the Subscription is expected to                       
    be not less than HK$360 million, of which it is expected                  
    that no less than HK$150 million will be used to finance                  
    the expansion of the Group's existing product types,                      
    such as ladies' intimate wear, knitwear and cotton                        
    pants and the remaining balance for general working                       
    capital of the Group.                                                     
                                                                              
    LOCK UP                                                                   
    Pursuant to the Placing Agreement, Capital Glory                          
    Limited has undertaken to the Placing Agent that it                       
    will procure that, prior to the date falling 3 months                     
    from the date of Placing Agreement, save with the prior                   
    written consent of the Placing Agent, no transfer or                      
    disposal of, or grant or creation of any interests or                     
    rights of any nature in respect of, any interest in                       
    any Shares (other than the Placing Shares but include                     
    the Shares acquired under the Subscription) owned by                      
    it (legally or beneficially) or any company which is                      
    Capital Glory Limited's holding company or subsidiary,                    
    or subsidiary of any such holding company, or directly                    
    or indirectly controlled by any of them, or in which                      
    any such person is interested, at the date of the                         
    Placing Agreement.                                                        
                                                                              
    Pursuant to the Placing Agreement, the Company has                        
    undertaken to the Placing Agent, save and except for                      
    the Subscription, not to offer, issue, sell or                            
    contract to sell, issue options in respect of or                          
    otherwise dispose of, directly or indirectly, or                          
    announce an offering or issue of, any Shares or any                       
    other securities exercisable or exchangeable for or                       
    convertible into, or substantially similar to, the                        
    Shares or enter into any transaction with the same                        
    economic effect as any of the foregoing for a period                      
    of 3 months from the date of the Placing Agreement,                       
    without the prior written consent of the Placing                          
    Agent.                                                                    
                                                                              
    GENERAL                                                                   
    The existing Shares were listed on the Main Board of                      
    the Stock Exchange on 15th July, 2004. The listing was                    
    well received by institutional investors and the                          
    public. The over-allotment option was partially                           
    exercised on 4th August, 2004. Net proceeds of                            
    approximately HK$640 million were raised from the                         
    listing. The detailed breakdown of the actual                             
    application of such proceeds during the year ended 31                     
    December 2004 will be included in the annual report                       
    of the Company for the year ended 31 December 2004 to                     
    be published.                                                             
                                                                              
    None of the substantial shareholders of the Company                       
    have dealt with the Shares since the commencement of                      
    the trading of the Shares on the Stock Exchange and                       
    prior to the date of this announcement.                                   
                                                                              
    In this announcement, the following expressions have                      
    the meanings set out below unless the context requires                    
    otherwise.