10:03 K. WAH INT'L<00173> & K. WAH CONS<00027>-JA & Resumption (2) Dr. Lui Che Woo and Mr. Francis Lui Yiu Tung (``Mr. Francis Lui''), both of whom are directors of KWIH and KWCM are also directors of Galaxy. Given the close relationship between the controlling shareholders of Galaxy and of KWCM, preliminary explorations of interest between KWCM and the controlling shareholders of Galaxy started in or about late May 2004 when it was discussed whether it might be worthwhile to consider investigating the possible injection of an interest in Galaxy into KWCM. In consequence of such explorations of interest, both Galaxy and KWCM initiated and proceeded with their respective and separate preliminary conceptual studies. Amongst other technical issues, Galaxy as part of its own exploration of interest and preliminary conceptual studies chose of its own accord to apply for, and then obtained, the approval of the Macau Government for the possible acquisition by KWCM of up to 90% of the shares in Galaxy. KWCM had not then decided that it would offer to acquire the interests in Galaxy nor has it yet so decided. Galaxy made an application without naming the transferee in December 2004. The Macau Government refused to accept it unless a transferee was named. Mr. Francis Lui (who is also a director of KWCM and of KWIH) then signed the application naming KWCM and its wholly-owned subsidiary on behalf of Galaxy on 12th January 2005. Apart from Mr. Francis Lui, none of the other members/employees of KWCM and KWIH knew that Galaxy would name KWCM and/or KWIH in the application. Apart from Mr Francis Lui, no members of the board of KWCM or KWIH had reviewed the 12th January application. KWCM understands that the application was made because the approval would be essential in the event anything came of the preliminary conceptual studies and KWCM, Galaxy and its shareholders wished to take matters further. The application was not previously disclosed by KWCM and KWIH as it was just part of the preliminary explorations of interest and preliminary conceptual studies. It could have been withdrawn. It could have been rejected. Even if successful it would not commit KWCM to acquire any interest in Galaxy. An announcement before approval could have caused speculation. KWCM was orally informed by Mr. Francis Lui on behalf of the controlling shareholders of Galaxy in the late afternoon of 19th January 2005 that the approval from the Macau Government had been obtained. So far as relevant, the Macau Government approved the possible acquisition by a wholly-owned subsidiary of KWCM of up to 90% of the shares in Galaxy. The approval was dated 17th January 2005 and received by Galaxy on 19th January 2005. The approval does not commit any shareholder in Galaxy to dispose of its interest to KWCM or any other person. It does not commit KWCM or any other person to acquire any interest in Galaxy. Such approval sought and obtained by Galaxy is a preliminary step to any possible negotiation, without which none can commence. Negotiations relating to the possible injection have not yet commenced. Management of KWCM has almost completed the preliminary conceptual studies which include research on the market, studies of different financing methods and structure, and technical studies as to the execution and implementation steps of the transaction. Management of KWCM expects to seek from its board in due course a mandate to enter into negotiations for the possible acquisition of shares in Galaxy if and when Galaxy shareholders indicate that they will entertain such negotiations. KWCM has been informed that no negotiation will commence until such time as further internal discussions between the Galaxy shareholders have taken place. KWCM cannot predict if and when that will happen. The timetable for the possible injection is yet to be decided and negotiations may or may not commence and if commenced may or may not lead to a transaction. In the event that a transaction materialises, KWIH and KWCM will make appropriate announcements as required by the Listing Rules. Investors are advised to exercise caution in dealing in the shares of KWCM and KWIH. KWIH wishes to refer also to its announcement of 17th December 2004 and states that it has now executed agreements for its participation in a joint venture property development company in Mainland China which constitutes a discloseable transaction of KWIH under the Listing Rules and is entirely unrelated to the possible transaction relating to Galaxy. A separate announcement by KWIH will be made as soon as practicable and investors should read that announcement when it is published. Save for the activities mentioned above and previously disclosed by KWIH in the Announcements and to be the subject of the separate announcement of KWIH referred to above, the KWIH Board confirms that there are presently no negotiations or agreements relating to intended acquisitions or realisations relating to KWIH which are discloseable under Rule 13.23 of the Listing Rules, neither is the KWIH Board aware of any matter discloseable under the general obligation imposed on KWIH by Rule 13.09 of the Listing Rules, which is or may be of a price-sensitive nature. The directors of KWIH individually and jointly accept responsibility for the accuracy of this announcement.