09:38     SHELL ELECTRIC<00081> - Announcement (4)                            

    has undertaken to ensure that Appeon will be entitled                     
    to use all patents, copyrights, engineering rights,                       
    technology rights, intellectual property rights,                          
    product names, trademarks and domain names currently                      
    being used by Appeon in its business after his                            
    resignation.                                                              
                                                                              
    Both Mr. Shi and Mr. Gao will each execute a                              
    non-competition undertaking in favour of Appeon,                          
    under which they will undertake, among others, not                        
    to engage or participate in similar business as that                      
    of Appeon and not to solicit Appeon's customers and                       
    staff.                                                                    
                                                                              
    The terms of the Acquisition Agreements have been                         
    negotiated on an arm's length basis. The Directors,                       
    including the independent non-executive Directors,                        
    consider that the terms of the Acquisition Agreements                     
    are on normal commercial terms, are fair and                              
    reasonable and in the interests of the shareholders                       
    of the Company as a whole.                                                
                                                                              
    Source of Funding                                                         
    The Group will finance the Acquisitions through                           
    internal resources.                                                       
                                                                              
    GENERAL                                                                   
    As Mr. Shi is a director and substantial shareholder                      
    of Appeon and Mr. Gao is a director of Appeon which                       
    is a non wholly owned subsidiary of the Company and                       
    a subsidiary of Sybond, each of Mr. Shi and Mr. Gao                       
    is a connected person of the Company and therefore                        
    the Acquisitions constitute connected transactions                        
    of the Company under the Listing Rules. Since each                        
    of the percentage ratios as defined in Rule 14A.10                        
    of the Listing Rules is less than 2.5%, the                               
    Acquisitions are only subject to the reporting and                        
    announcement requirements set out in Rules 14A.45 and                     
    14A.47 of the Listing Rules but otherwise exempt from                     
    the independent shareholders' approval requirements                       
    under Chapter 14A of the Listing Rules.                                   
                                                                              
    Definitions:-                                                             
    In this announcement, the following terms have the                        
    following meanings:-                                                      
                                                                              
    "Acquisitions"  the Shi Acquisition and the Gao                           
    Acquisition                                                               
                                                                              
    "Acquisition Agreements"        the Shi Agreement and the                 
    Gao Agreement                                                             
                                                                              
    "Appeon"        Appeon Corporation, a company incorporated                
    in the British Virgin Islands and a non wholly owned                      
    subsidiary of the Company and a subsidiary of Sybond                      
                                                                              
    "Company"       Shell Electric Mfg. (Holdings) Company                    
    Limited, a company incorporated in Hong Kong with                         
    limited liability, the securities of which are listed                     
    on the Stock Exchange                                                     
                                                                              
    "Directors"     the directors of the Company                              
                                                                              
    "Group" the Company and it subsidiaries                                   
                                                                              
    "Gao Acquisition"       the proposed acquisition of the                   
    Gao Sale Shares pursuant to the Gao Agreement                             
                                                                              
    "Gao Agreement" the agreement dated 27 January 2005                       
    in relation to the sale and purchase of the Gao Sale                      
    Shares entered into between Mr. Gao and Sybond