09:53     SHIMAO CHINA<00649> - Announcement & Resumption (2)                 

    the Company under the Listing Rules. As the Vendor                        
    is wholly owned by Mr. Hui, the Acquisition also                          
    constitutes a connected transaction for the Company                       
    under the Listing Rules and is therefore subject to                       
    the approval of the Independent Shareholders at the                       
    SGM.                                                                      
                                                                              
    To be in line with the current Listing Rules in                           
    relation to share option schemes and to enable the                        
    Company to grant share options to selected eligible                       
    participants as incentive or rewards for their                            
    contributions to the Group, the Board also proposes                       
    to terminate the existing share option scheme of the                      
    Company and to adopt a new share option scheme of the                     
    Company. A circular containing, inter alia, details                       
    of the Acquisition, the S&P Agreement, the                                
    recommendation from the independent board committee                       
    and the advice of the independent financial adviser                       
    in respect of the S&P Agreement and transactions                          
    contemplated thereunder, as well as details of the                        
    new share option scheme and a notice to convene the                       
    SGM, will be despatched to the Shareholders as soon                       
    as practicable.                                                           
                                                                              
    Trading in the Shares was suspended with effect from                      
    9:30 a.m. on 21 February 2005 pending the publication                     
    of this announcement. Application has been made to                        
    the Stock Exchange for resumption of trading in the                       
    Shares with effect from 9:30 a.m. on 24 February 2005.                    
                                                                              
    THE S&P AGREEMENT DATED 19 FEBRUARY 2005                                  
    Parties                                                                   
    Date    :       19 February 2005                                          
                                                                              
    Purchaser       :       The Company                                       
                                                                              
    Vendor  :       Dynamic Keen Developments Limited                         
                                                                              
    Guarantor       :       Mr. Hui                                           
                                                                              
    Assets to be acquired                                                     
    Sale Share      :       One share of US$1.00, representing the            
    entire issued share capital of Value Ahead                                
                                                                              
    Sale Loan       :       the amount due from Value Ahead to the            
    Vendor on the Completion Date which shall not be less                     
    than HK$194,611,000 (being the outstanding amount due                     
    from Value Ahead to the Vendor as at the date of the                      
    S&P Agreement)                                                            
                                                                              
    Consideration and payment terms                                           
    The Consideration for the Acquisition comprises the                       
    Share Consideration and the Loan Consideration. The                       
    Share Consideration is HK$301,609,000 and the Loan                        
    Consideration is HK$194,611,000. The Consideration,                       
    being the aggregate of the Share Consideration and                        
    the Loan Consideration, payable by the Company to the                     
    Vendor for the Acquisition of HK$496,220,000 is                           
    equivalent to the sum of the unaudited consolidated                       
    net deficit of Value Ahead Group as at 31 December                        
    2004 of approximately HK$3,620,000, the valuation                         
    surplus after deferred taxation effect of the                             
    property interests of Suifenhe Shimao of                                  
    approximately HK$305,229,000 and the outstanding                          
    loan due from Value Ahead to the Vendor as at 31                          
    December 2004 of HK$194,611,000. The Consideration                        
    was negotiated on an arm's length basis and was                           
    determined with reference to the unaudited                                
    consolidated net deficit of Value Ahead Group at 31                       
    December 2004, the valuation surplus after deferred                       
    taxation effect of the property interest of Suifenhe                      
    Shimao, the outstanding loan due from Value Ahead to                      
    the Vendor as at 31 December 2004 and the development                     
    rights of Suifenhe Shimao