09:37     KIU HUNG INT'L<00381> - 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.                   
                                                                              
                                                                              
    KIU HUNG INTERNATIONAL HOLDINGS LIMITED                                   
    (incorporated in the Cayman Islands with limited liability)               
    (Stock Code: 381)                                                         
                                                                              
                                                                              
    DISCLOSEABLE AND CONNECTED TRANSACTION:                                   
                                                                              
    DISPOSAL OF THE ENTIRE ISSUED SHARE CAPITAL OF                            
    HUGE PROFIT ENTERPRISES LIMITED                                           
                                                                              
    On 19 April 2005, Legend Wealth, a wholly owned subsidiary of the         
    Company, entered into the Sale and Purchase Agreement with Kiu Hung       
    Holdings in relation to the Disposal.                                     
                                                                              
    Huge Profit, a wholly-owned subsidiary of the Company, is incorporated    
    on 28 November 2003 in the British Virgin Islands with limited liability  
    and is an investment holding company of the Group. Huge Profit owns 30%   
    of the equity interests in Sangyang Spandex.                              
                                                                              
    Sangyang Spandex is a Chinese-foreign equity joint venture established    
    on 13 January 2004 in the PRC and is principally engaged in production,   
    research and development and sale of spandex in the PRC.                  
                                                                              
    As the entire issued share capital of Kiu Hung Holdings is beneficially   
    owned by Mr Hui Kee Fung, Mr Hui Ki Yau, Madam Hui Hung Tan, Teresa (all  
    being executive Directors) and their associates, Kiu Hung Holdings is     
    therefore a Connected Person. Accordingly, the Disposal constitutes a     
    connected transaction on the part of the Company under the Listing Rules  
    and will be subject to the approval of the Independent Shareholders at    
    the EGM by way of poll. The transaction also constitutes a discloseable   
    transaction on the part of the Company under the Listing Rules.           
                                                                              
    A circular containing, among other things, details of the Disposal, the   
    letter from the independent financial adviser to the Independent Board    
    Committee and the Independent Shareholders on the Disposal, the           
    recommendation of the Independent Board Committee to the Independent      
    Shareholders on the Disposal, information regarding the Group and a       
    notice of EGM will be despatched to the Shareholders within 21 days       
    after the publication of this announcement.                               
                                                                              
    THE SALE AND PURCHASE AGREEMENT                                           
                                                                              
    Date:        19 April 2005                                                
                                                                              
    Parties:        (1) Vendor        :        Legend Wealth                  
                                                                              
            (2) Purchaser        :        Kiu Hung Holdings                   
                                                                              
            (3) Guarantors        :        Mr Hui Kee Fung;                   
                                                                              
                            Mr Hui Ki Yau; and                                
                                                                              
                            Madam Hui Hung Tan, Teresa.                       
                                                                              
    Kiu Hung Holdings is a company incorporated in Hong Kong with limited     
    liability and is principally engaged in investment holding. The           
    subsidiaries of Kiu Hung Holdings are principally engaged in              
    manufacturing and trading of chemical products and property investment.   
                                                                              
    As the entire issued share capital of Kiu Hung Holdings is beneficially   
    owned by Mr Hui Kee Fung, Mr Hui Ki Yau, Madam Hui Hung Tan, Teresa (all  
    being executive Directors) and their associates, Kiu Hung Holdings is     
    therefore a Connected Person.                                             
                                                                              
    Asset to be disposed:                                                     
                                                                              
    The Sale Shares                                                           
                                                                              
    10,000 shares of US$1.00 each in the share capital of Huge Profit,        
    representing the entire issued share capital of Huge Profit.              
                                                                              
    The Sale Loan                                                             
                                                                              
    The shareholder's loan in the sum of HK$14,029,904 owing by Huge Profit   
    to Legend Wealth as at the date of the Sale and Purchase Agreement.       
                                                                              
    Consideration:                                                            
                                                                              
    The aggregate consideration for the sale and purchase of the Sale Shares  
    and the Sale Loan shall be the aggregate amount of HK$14,029,905, of