09:37     CLP HOLDINGS<00002> - Announcement (2)                              

    Consideration financed from internal resources and external financing     
    have yet to be fixed.                                                     
                                                                              
    Conditions                                                                
                                                                              
    Completion of the Acquisition is conditional upon various regulatory      
    approvals, third party consents and the separation of the EB from SPI     
    Australia Group's other businesses in Australia.                          
                                                                              
    Completion                                                                
                                                                              
    The targeted completion date for the Acquisition is 31 May 2005 with      
    the ability for that date to be extended according to the terms of the    
    Share Sale Agreement.                                                     
                                                                              
    INFORMATION ON THE EB                                                     
                                                                              
    EB is the fifth largest energy retailer in Australia and sells gas and    
    electricity to over 1.1 million customers across Victoria, New South      
    Wales, South Australia and Queensland. It also owns a 1,280 MW            
    gas-fired power station at Torrens Island, South Australia, an interest   
    in a long-term hedge contract for up to 966 MW, and a gas storage         
    facility. SPI Pipelines owns a 33% interest in SEAGas, which owns and     
    operates a 685 kilometre natural gas transmission pipeline between        
    Victoria and South Australia. This interest in SEAGas is the subject of   
    pre-emption rights. In the event that such rights are exercised, the      
    Consideration will be reduced by the SEAGas Adjustment. It is important   
    to note that should such rights be exercised, the EB will retain usage    
    rights associated with the SEAGas pipeline.                               
                                                                              
    For the financial year ended 31 December 2004, the combined unaudited     
    EBITDA of EB was A$181.2 million (HK$1,105 million). For the financial    
    year ended 31 December 2003, the combined unaudited EBITDA of EB was      
    A$217.5 million (HK$1,327 million). As at 31 December 2004, the EB had    
    combined unaudited total assets of A$3,163 million (HK$19,294 million).   
    As the EB is only a part of the SPI Australia Group, the Company          
    understands that interest, tax and depreciation were booked on a group    
    basis and were not individually attributed to the underlying companies    
    which have, therefore, not prepared figures which represent their own     
    profits before and after taxation.                                        
                                                                              
    REASONS FOR THE ACQUISITION                                               
                                                                              
    The CLP Group's investments in the Australian energy sector, prior to     
    the Acquisition, comprise a 1,480 MW coal-fired power station at          
    Yallourn, Victoria held through Yallourn Energy, and the AusPower         
    retail business, which sells electricity to large industrial and          
    commercial customers. The Acquisition is in line with the CLP Group's     
    objective of building a diversified and integrated energy business in     
    Australia, focussing on electricity and gas retail, with a portfolio of   
    physical assets in support of that retail business.                       
                                                                              
    The Consideration was agreed between the parties following a bidding      
    process and after arm's length negotiations, taking into account a due    
    diligence process previously undertaken by the CLP Group and its          
    advisors. Many factors were taken into account including the cash flow    
    and earnings of the EB and an assessment of its business potential. The   
    Directors consider that the terms of the Acquisition are fair and         
    reasonable and in the interests of the shareholders as a whole.           
                                                                              
    GENERAL                                                                   
                                                                              
    The Acquisition constitutes a discloseable transaction of the Company     
    under Chapter 14 of the Listing Rules. A circular containing further      
    information on the Acquisition will be sent to shareholders as soon as    
    practicable.                                                              
                                                                              
    To the best of the Directors' knowledge, information and belief having    
    made all reasonable enquiries, Singapore Power and its ultimate           
    beneficial owner are third parties independent of the Company and its     
    connected persons (as defined in the Listing Rules).                      
                                                                              
    Singapore Power, headquartered in Singapore, has significant operations   
    in Asia and Australia. Following the sale of the EB to the CLP Group,     
    Singapore Power will retain electricity transmission and distribution     
    networks in Australia.                                                    
                                                                              
    CLP Power Asia is a member of the CLP Group. The CLP Group owns and       
    operates a vertically integrated electricity generation, transmission     
    and distribution business in Hong Kong, and invests, primarily through    
    CLP Power Asia (of which CLP Energy itself is a subsidiary), in the       
    power sector in the Chinese mainland, Taiwan, Australia, India, and       
    Thailand.