09:47 CHINA WATER<00855> - Announcement & Resumption (4) HK$2.3 million for repayment of other payables of the Company such as secretarial and professional fees and printing charges; Used as the intended purposes. HK$5.3 million for the repayment of remaining cash consideration for acquisition of two water sewage plants; and Approximately HK$3.2 million has been used as the intended purpose and remaining balance of approximately HK$2.1 million held as bank balances of the Group. HK$9 million for the development of water supply business for the Company's joint venture located at Renhua Xian, Guangdong Province, the PRC. Approximately HK$6.5 million has been used as the intended purpose and remaining balance of approximately HK$2.5 million held as bank balances of the Group. 15th March, 2005 Placing of existing shares and subscription of new shares HK$15 million HK$14.4 million HK$5 million for its general working capital; and The balances held as bank balances of the Group. HK$9.4 million for future investments in city water supply business in the PRC. The balances held as bank balances of the Group. The Director consider that the Placing and the Subscription will broaden the shareholder base and capital base of the Company. The Directors estimate that the net proceeds of the Subscription will be approximately HK$28.1 million. The Directors intend to use the net proceeds from the Subscription as to HK$3.0 million for working capital purposes and the remaining HK$25.1 million for future investments in city water supply business and sewage treatment business in the PRC. As at the date of this announcement, the Company is in discussion with several third parties who are not a connected person (as defined in the Listing Rules) of the Company regarding possible investments in city water supply business and sewage treatment business in the PRC. The discussions are at a preliminary stage and no binding agreement has been made and that the possible investments may or may not proceed. The additional fund raised from the Placing and Subscription increase the level of liquidity of the Company and enable the Company has sufficient capital to invest in city water supply business and sewage treatment business in the PRC if opportunities arise. The Company has not identified any specific projects to invest in as of the date of this announcement. At the request of the Company, the Shares have been suspended from trading on the Stock Exchange from 11:11 a.m. on 4th April, 2005 and applications have been made to the Stock Exchange for resumption of trading from 9:30 a.m. on 7th April, 2005 respectively. DEFINITIONS "Company" : China Water Affairs Group Limited, a company incorporated in the Cayman Islands and continued in Bermuda with limited liability "connected person(s)" : as defined in the Listing Rules "Director(s)" : the director(s) of the Company "HK$" : Hong Kong Dollars, the lawful currency of Hong Kong Special Administrative Region of the PRC "Listing Rules" : the Rules Governing the Listing of Securities on the Stock Exchange "New Shares" : 57,600,000 new Shares to be subscribed by the Vendor under the Subscription Agreement and is equal to the number of Placing Shares sold under the Placing Agreement "Placing" : the placing of the Placing Shares by the Placing Agent on behalf of the Vendor pursuant to the Placing Agreement