09:47 HANISON<00896> - Announcement (1) 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. HANISON CONSTRUCTION HOLDINGS LIMITED (Incorporated in the Cayman Islands with limited liability) (Stock Code : 896) CONNECTED TRANSACTION ACQUISITION OF SHARES The Directors are pleased to announce that on 21 March 2005, Media Group, a wholly-owned subsidiary of the Company, entered into the Agreement with HKR, an indirect wholly-owned subsidiary of HKRI (a substantial shareholder of the Company) in relation to the acquisition by Media Group of the entire issued share capital of General Target from HKR for a consideration of HK$4,000,000 subject to adjustments on the prepayments and accruals in the accounts of General Target. The Consideration will be satisfied in cash at completion and will be financed by internal source of funds of the Group. As HKRI is a substantial shareholder and a connected person of the Company, the entering into of the Agreement and the Acquisition contemplated therein will constitute a connected transaction for the Company under the Listing Rules. As the relevant percentage ratios represented by the Consideration are more than 0.1% but less than 2.5%, the entering into of the Agreement and the Acquisition is pursuant to Rule 14A.32 of the Listing Rules exempt from the independent shareholders' approval requirements and is subject to the reporting and announcement requirements set out in Rules 14A.45 to 14A.47 of the Listing Rules. THE AGREEMENT Date: 21 March 2005 Parties: HKR as the vendor Media Group as the purchaser Assets to be acquired: Pursuant to the Agreement, Media Group has agreed, amongst other things, to acquire the entire issued share capital of General Target from HKR for a consideration of HK$4,000,000 subject to adjustments on the prepayments and accruals in the accounts of General Target. General Target is a property leasing company which owns a leasehold interest from an independent third party not connected with the Company and its connected persons in respect of the Property for a term of 30 years commencing from 1 December 1989, with an option to renew for a further term of 30 years upon expiry on 30 November 2019. The Property is currently sub-leased by General Target to third parties independent of the Company and its connected persons. At present, the net annual rental income (before expenses) from the Property is HK$360,000, generating a yield of approximately 9% p.a.. For the year ended 31 March 2003, the audited net profit before and after taxation and extraordinary items of General Target were HK$38,243 and HK$22,240. For the year ended 31 March 2004, the audited net loss before and after taxation and extraordinary items of General Target were HK$246,605 and HK$279,037. As at 31 March 2004, the audited net asset value was HK$1,076,336. General Target including its underlying leasehold interests were previously acquired by HKRI from independent third parties on 2 December 2000 and 24 December 2001 for a total cost of HK$3,267,798. The Directors, including the independent non-executive Directors, consider that the terms of the Agreement have been entered into on normal commercial terms, on an arm's length basis and are fair and reasonable so far as the shareholders of the Company (including the independent shareholders) as a whole are concerned. CONSIDERATION AND PAYMENT TERMS The Consideration for the Acquisition is HK$4,000,000 and is subject to adjustments on the prepayments and accruals in the accounts of General Target as at 21 March 2005. The net amount payable by the Company after these adjustments is HK$3,859,750. The Directors