09:34 EGANAGOLDPFEIL<00048>-Announcement & Resumption of Trading-3 Parties : Purchaser : Goldpfeil GmbH Seller : EnBW The principal business activity of EnBW is energy provider and EnBW is the fourth largest energy provider company in Germany. EnBW and its ultimate beneficial owner are independent third parties and not connected with any connected persons of the Company (as defined in the Listing Rules). Assets to be acquired and the Consideration to be paid Pursuant to the Trademark Agreement, Goldpfeil GmbH agreed to purchase from EnBW the Salamander Trademark Rights on a global basis for all categories. The consideration for the acquisition of the Salamander Trademark Rights is EUR9 million (HK$92.4 million) which was determined by reference to a 5% royalty rate range on an arm's length basis. REASONS AND BENEFITS FOR THE ACQUISITIONS Since one of the Company's principal business activities is engaged in design, assembly, manufacturing and worldwide distribution of leather products, the acquisitions of the Salamander European Operations, leasing of the Salamander Germany Retail Shops with the Lessors or if not practicable, with Dr. Hefermehl, as the insolvency administrator of SSHG and the Salamander Trademark Rights will further enhance the strength and growth of the leather business and facilitate the Company to expand its present leather business in Asia and Europe markets which in return, will increase the sales of leather related products in these markets. Based on the Company's expertise in manufacturing leather products, existing production facilities (centralized product procurement facilities in Germany) and sourcing high quality Manmade Leather Supply, the integration of Salamander European Operations and Salamander German Retail Shops into the Company's existing leather business will increase the overall profit margin and secure faster order fulfillment. In addition, the acquisitions of Salamander European Operations and the lease of Salamander Retail Shops in Germany will also enlarge the Group's present leather products coverage to build up a `Multi-Brand Boutiques' Club Network. The network will enlarge to cover 200 Stores operated and owned by the Group in 8 key countries (Germany, England, France, Austria, Poland, Czech, Russia and Hungary) in Europe and such acquisitions will facilitate the building up of the `Multi-Brand Boutiques' Club Network and expand sales in Europe. With the selective Multi-Brand Boutiques Club established in Europe, it will be used as a platform to attract strategic retail partners in Asia for the introduction of `Salamander' leather footwear to Asia starting from the Company's financial year ending 31st May, 2006. The retail expertise of Salamander operations is believed to be a prefect strategic fit to that of the Company's retail team involving in Goldpfeil, Comtesse and JOOP! (the brands within the Company's existing portfolio), which produces a valid base to expand on franchising network for Goldpfeil, Comtesse and JOOP! in Europe and Asia. GENERAL Condition Precedents The completions of the Salamander European Operations Agreement, the Salamander German Inventories and Assets Agreement and the Salamander Trademark Agreement are subject to the approval of the Federal Cartel office in Germany and the expected date of Closing of these transactions is 31st March, 2005. No deposit is or is to be paid to SSG, SSHG and EnBW. If the Federal Cartel office's approval cannot be obtained on or before the Closing Date, then the three transactions will be terminated. LISTING RULES COMPLIANCE In accordance with the Chapter 14 of the Listing Rules, the Sale and Purchase Agreements and Trademark Agreement together constituted as a discloseable transaction which is subject to reporting, announcement and circular requirements under Rules 14.35 and 14.38 of the Listing Rules. A circular containing detailed information of the above transactions will be dispatched to Shareholders within 21 days after the date of this announcement. The Directors consider that, taking into account of the benefits the Company will gain from these transactions, the terms and these Agreements are fair and reasonable and are in the interests of the Company and its Shareholders as a whole. Trading of the Shares of the Company on the Stock Exchange was suspended at the request of the Company from 9:30 a.m. on 4th March, 2005 pending the release of this announcement. Application has been made to the Stock Exchange for the resumption of trading of the