09:31     SUN INNOVATION<00547> - Announcement (3)                            

    In January 2005, the Company has issued 196,000,000 shares                
    as consideration for the acquisition of the entire issued                 
    share capital of Prehit, a Japan company with content                     
    aggregation business, for a consideration of                              
    HK$13,406,400. Details of this transaction are disclosed                  
    in an announcement dated 21st December, 2004 and a                        
    circular dated 12th January, 2005.                                        
                                                                              
    In addition, in January 2005, the Company has also                        
    received a notice from T&C Capital Limited, the                           
    convertible preference shareholder of the Company who                     
    acquired 1.2 Billion convertible preference shares ("CP                   
    Shares") of the Company from Station Investments Limited                  
    in December 2004 and January 2005, to convert 800,000,000                 
    CP Shares into ordinary shares of the Company at a                        
    conversion price of HK$0.0225 per ordinary shares. The                    
    conversion of CP Shares will not involve any cash                         
    injection. Details of the transfer of CP Shares are                       
    disclosed in the announcement dated 29th November, 2004.                  
    The Company is arranging the issue and allotment of                       
    800,000,000 ordinary shares of the Company at the date of                 
    this announcement.                                                        
                                                                              
    Based on the register maintained by the Company under the                 
    Securities and Futures Ordinance as at the date of this                   
    Announcement and assuming no further shares are issued by                 
    the Company, the shareholding of the Company before and                   
    after the issue of the Option Shares and after exercise                   
    of the Option Shares and all CP Shares and other options                  
    are as follows:                                                           
                                                                              
       Before exercise of the Option Shares                                   
                                                                              
       After exercise of the Option Shares                                    
                                                                              
       After exercise of the Option Shares and all CP Shares                  
    and other options Note 5                                                  
       Number   Number   Number                                               
    Name of Shareholder   of shares   %   of shares   %   of                  
    shares   %                                                                
                                                                              
    Michele Matsuda Note 1   820,000,000   13.32                              
    820,000,000   12.85   820,000,000   9.14                                  
    The Grantees Note 2   -   0   225,000,000   3.53                          
    225,000,000   2.51                                                        
    Knight Assets Limited   -   0   -   0   230,000,000                       
    2.56                                                                      
    Leung Kin Cheung Note 3   281,240,000   4.57                              
    281,240,000   4.41   2,237,906,666   24.96                                
    T&C Capital Ltd Note 4   800,000,000   13.00                              
    800,000,000   12.53   1,200,000,000   13.38                               
    Public Shareholders   4,254,348,973   69.11                               
    4,254,348,973   66.68   4,254,348,973   47.45                             
                                                                              
                                                                              
    Total   6,155,588,973   100   6,380,588,973   100                         
    8,967,255,639   100                                                       
                                                                              
                                                                              
    Note 1:   The number of shares includes 805,570,000                       
    shares held by e-Compact Limited which is beneficially                    
    owned Mr. Michele Matsuda, the Chairman of the Company.                   
                                                                              
    Note 2:   Assumes exercise by the Grantese of the Option                  
    in full.                                                                  
                                                                              
    Note 3:   Mr. Leung held 1,866,666,666 CP Shares and                      
    90,000,000 options through Station Investments Limited.                   
                                                                              
    Note 4:   It acquired 1,200,000,000 CP Shares from                        
    Station Investments Limited in December 2004 and January                  
    2005 and submit a conversion notice to the Company to                     
    convert 800,000,000 CP Shares into ordinary shares in                     
    January 2005.                                                             
                                                                              
    Note 5: The other options excludes options granted under                  
    employee share option schemes.