09:25     SHANGHAI IND H<00363> - Announcement (2)                            

    CONTINUING CONNECTED TRANSACTIONS                                         
                                                                              
    Shanghai Industrial United Holdings Co., Ltd. (``SI United''), a          
    subsidiary of the Company, owns a 51% interest in Guangdong Techpool.     
    Guangzhou Bopu Bio-Technology Co., Ltd.* (``Guangzhou Bopu'') is a        
    substantial shareholder of Guangdong Techpool and is accordingly a        
    connected person of the Company. As Changzhou Techpool is a subsidiary    
    of Guangzhou Bopu, hence, pursuant to the Rules Governing the Listing     
    of Securities of The Stock Exchange of Hong Kong Limited (the             
    ``Listing Rules''), Changzhou Techpool is deemed as a connected           
    person of the Company.                                                    
                                                                              
    Pursuant to the Listing Rules, the Purchase Transactions constitute       
    continuing connected transactions of the Company. Since each of the       
    percentage ratios as to the transaction amount calculated on an annual    
    basis is expected to be less than 2.5% which falls within Rule 14A.34(1)  
    of the Listing Rules, the Purchase Transactions are expected to be        
    exempt from independent shareholders' approval requirement. Pursuant      
    to Rules 14A.45 to 14A.47 of the Listing Rules, the transactions will     
    be subject to disclosure in an announcement and the details of which      
    shall be included in the Company's next and subsequent published          
    annual reports and accounts for the financial years during which the      
    transactions persist.                                                     
                                                                              
    REASONS FOR THE CONTINUING CONNECTED TRANSACTIONS                         
                                                                              
    The Board (including the Independent Non-executive Directors)             
    considers that as Changzhou Techpool is among the few suppliers in        
    Mainland China that can satisfy Guangdong Techpool's stringent            
    requirements for raw pharmaceuticals such as on quality, delivery and     
    cost, the entering into a long-term raw pharmaceuticals purchase          
    agreement with Changzhou Techpool will help Guangdong Techpool            
    maintain the stability of its product quality and this single source      
    of supply would help to maintain the confidentiality of the               
    manufacturing formula.                                                    
                                                                              
    Pursuant to the Agreement, the Purchase Transactions will be              
    conducted on normal commercial terms. The Board (including the            
    Independent Non-executive Directors) considers that the terms of the      
    Agreement are fair and reasonable and the entering into of the            
    Agreement is in the interests of the shareholders of the Company as       
    a whole.                                                                  
                                                                              
    GENERAL INFORMATION                                                       
                                                                              
    The Company and its subsidiaries are engaged in the principal             
    businesses of infrastructure facilities, medicine, consumer products      
    and information technology. Changzhou Techpool is principally             
    engaged in research, development, manufacture and sale of raw             
    bio-pharmaceuticals and finished pharmaceuticals.                         
                                                                              
    By Order of the Board                                                     
    Wong Mei Ling, Marina                                                     
    Company Secretary                                                         
                                                                              
    Hong Kong, 7th April 2005                                                 
                                                                              
    As at the date of this announcement, the Board of the Company is          
    comprised of:                                                             
                                                                              
    Executive Directors:                                                      
    Mr. Cai Lai Xing, Mr. Qu Ding, Mr. Lu Ming Fang, Mr. Lu Da Yong, Mr.      
    Ding Zhong De, Mr. Lu Shen, Mr. Qian Shi Zheng, Mr. Yao Fang and Mr.      
    Tang Jun                                                                  
                                                                              
    Independent Non-Executive Directors:                                      
    Dr. Lo Ka Shui, Prof. Woo Chia-Wei and Mr. Leung Pak To, Francis          
                                                                              
    * The English name is an informal English translation of its official     
    Chinese name.