09:20     EGANA JEWELLERY<00926> - Announcement                               

    The Stock Exchange of Hong Kong Limited takes no responsibility for       
    the contents of this announcement, makes no representation as to its      
    accuracy or completeness and expressly disclaims any liability            
    whatsoever for any loss howsoever arising from or in reliance upon        
    the whole or any part of the contents of this announcement.               
                                                                              
    EGANA JEWELLERY & PEARLS LIMITED                                          
    (Incorporated in the Cayman Islands with limited liability)               
    (stock code: 926)                                                         
                                                                              
    ISSUE OF TRANCHE 3A BONDS OF UP TO US$5,000,000 PURSUANT TO THE           
    SUBSCRIPTION AGREEMENTS ENTERED INTO BETWEEN MERRILL LYNCH AND THE        
    COMPANY                                                                   
                                                                              
    ANNOUNCEMENT                                                              
                                                                              
    Reference is made to the Company's announcement dated 18th February,      
    2005 in relation to the issue of Tranche 3a Bonds to Merrill Lynch.       
                                                                              
    Unless the context otherwise requires, defined terms used in this         
    announcement shall have the same respective meanings as in the            
    Company's Announcements dated 10th February, 2004, 26th February,         
    2004, 13th January, 2005 and 18th February, 2005.                         
                                                                              
    Exercise of the conversion rights by Merrill Lynch under the Tranche      
    3a Bonds                                                                  
                                                                              
    With reference to the Company's announcement dated 18th February,         
    2005 regarding the monthly disclosure requirement on the dilution         
    effect on Shareholders of the Company in relation to the issue of the     
    Tranche 3a Bonds, the Board of Directors announces that during the        
    period from 4th February, 2005 (date of granting the listing              
    approval) to the month ended 28th February, 2005, Merrill Lynch has       
    exercised its conversion rights to convert US$2,500,000 Tranche 3a        
    Bonds into 16,488,710 new Shares of the Company at a floating             
    conversion price of HK$1.1826 per Share. The issue of new Shares          
    represent respective 4.33% and 4.15% dilution effect on the               
    Shareholders of the Company based on the existing number of               
    380,975,662 Shares issued and the enlarged number of 397,464,372          
    Shares in issued.                                                         
                                                                              
    As at the date of this announcement, the Board comprises Mr.              
    Hans-Joerg SEEBERGER, Mr. Peter Ka Yue LEE, Mr. Michael Richard POIX,     
    Mr. Ho Yin CHIK, Mr. David Wai Kwong WONG, Mr. Shunji SAEKI and Mr.       
    Michael BOMMERS as executive directors and Mr. Charles Cho Chiu SIN,      
    Mr. Eduardo Tang Lung LAU and Professor Zhengfu WANG as independent       
    non-executive directors.                                                  
                                                                              
                                   By order of the Board Egana                
                                   Jewellery & Pearls Limited                 
                                   David Wai Kwong WONG                       
                                   Company Secretary                          
                                                                              
                                                                              
                                                                              
    Hong Kong, 7th March, 2005