09:38     CHINA SCI-TECH<00985>-Announcement&Resumption of Trading(7)         

    GENERAL                                                                   
    The Capital Increase constitutes a very substantial acquisition and       
    connected transaction for the Company under the Listing Rules and         
    will be subject to the approval of the Shareholders at the EGM under      
    Rules 14.49 and 14A of the Listing Rules.                                 
                                                                              
    By virtue of Mr. Zhao's interest in (i) Kaison Limited, which holds       
    approximately 10.70% interest in the total issued share capital of        
    the Company as at the date hereof; and (ii) Shuanghuan Holdings, Mr.      
    Zhao, Ms. Guo, Kaison Limited and their respective associates will        
    abstain from voting at the EGM to approve the Agreement and the           
    transactions contemplated thereunder. Based on the record kept by the     
    Company pursuant to Section 336 of Part XV of the SFO and so far as       
    the Directors are aware, other than the 10.70% interest in the            
    Company, Mr. Zhao, Ms. Guo and Kaison Limited do not have any             
    interest in any convertible securities or other subscription rights,      
    options or interests in or in respect of underlying shares of the         
    Company.                                                                  
                                                                              
    Mr. Zhao is (i) the substantial shareholder of the Company holding        
    approximately 10.70% of the total issued share capital of the             
    Company, and (ii) the direct and indirect shareholder of Shuanghuan       
    Holdings interested in 51% of its issued share capital, Shuanghuan        
    and Shuanghuan Holdings are associates of Mr Zhao. Therefore, Mr.         
    Zhao, Shuanghuan and Shuanghuan Holdings are connected persons of the     
    Company under the Listing Rules. The transactions contemplated under      
    the Agreement will constitute connected transaction under Chapter 14A     
    of the Listing Rules. Mr. Zhao is also the chairman of Shuanghuan and     
    Shuanghuan Holdings respectively.                                         
                                                                              
    A circular containing, inter alia, further details of the Agreement       
    and the Capital Increase and a notice of the EGM for the purpose of       
    approving the Agreement and the transactions contemplated thereunder      
    will be dispatched by the Company to the Shareholders as soon as          
    practicable in accordance with the Listing Rules.                         
                                                                              
    Trading in the Shares was suspended at the request of the Company         
    with effect from 9:30 a.m. on 4 April 2005 pending the release of         
    this announcement. An application has been made by the Company to the     
    Stock Exchange for the trading in the Shares to resume from 9:30 a.m.     
    on 14 April 2005 following the publication of this announcement.          
                                                                              
    Shareholders and potential investors should note that the Agreement       
    is subject to conditions to be fulfilled. Shareholders and potential      
    investors are reminded to exercise caution when dealing in the            
    Shares.                                                                   
                                                                              
    As at the date of this announcement, the executive Directors are Mr.      
    Chiu Kong (Chairman), Mr. Kwan Kam Hung, Jimmy, Mr. Hui Richard Rui       
    and Mr. Wang Guangtian and the independent non-executive Directors        
    are Mr. Miu Frank H., Mr. Yu Pan and Ms. Tong So Yuet.                    
                                                                              
    DEFINITIONS                                                               
    `Agreement'                    the agreement dated 1 April                
                                   2005 entered into between                  
                                   Shuanghuan, Tian Yang and                  
                                   Shuanghuan Holdings in                     
                                   respect of the Capital                     
                                   Increase                                   
    `associates'                   has the meaning given to that              
                                   term in the Listing Rules                  
    `Board'                        the board of Directors                     
    `Capital'                      the amount of capital in the               
                                   sum of USD30,200,000                       
                                   (equivalent to approximately               
                                   RMB249,995,600 or                          
                                   HK$235,258,000) to be payable              
                                   by Tian Yang to Shuanghuan in              
                                   relation to its contribution               
                                   to the Capital Increase                    
                                   pursuant to the Agreement                  
    `Capital Increase'             the increase of the                        
                                   registered capital of                      
                                   Shuanghuan from USD4,980,000               
                                   (equivalent to approximately               
                                   RMB41,224,440 or                           
                                   HK$38,794,200) to                          
                                   USD35,180,000 (equivalent to               
                                   approximately RMB291,220,040               
                                   or HK$274,052,200) pursuant                
                                   to the Agreement                           
    `Capital Increase Agreement'   the Agreement, the                         
                                   Shareholders Agreement, the                
                                   amendment agreement to the                 
                                   Joint Venture Agreement and                
                                   the amendment agreement to                 
                                   the articles of association                
                                   of Shuanghuan                              
    `Company'                      China Sci-Tech Holdings                    
                                   Limited, a company                         
                                   incorporated in the Cayman                 
                                   Islands with limited                       
                                   liability and the shares of                
                                   which are listed on the Stock