09:34     HUALING<00382> - Announcement (3)                                   

    The holding company of Midea Ltd., which is the holding company           
    of Midea International (the controlling shareholder of the                
    Company), together with Midea Ltd., are directly and indirectly           
    interested so as to control the exercise of more than 30% of              
    the voting power of Midea Electric and accordingly, Midea                 
    Electric is a connected person of the Company and the                     
    transactions between members of the Group and members of the              
    Midea Electric Group constitute connected transactions for the            
    Company under Chapter 14A of the Listing Rules.                           
                                                                              
    Pursuant to Rules 14A.18 and 14A.35, the Continuing Connected             
    Transactions are subject to the reporting and announcement                
    requirements and the approval by the Independent Shareholders             
    at the EGM. Midea International and its associates will abstain           
    from voting in respect of the ordinary resolutions proposed to            
    approve the Continuing Connected Transactions at the EGM. An              
    independent board committee consisting of Mr. Chan Wai Dune,              
    Mr. Lam Ming Yung and Ms. Chen Chunhua who are the independent            
    non-executive Directors has been appointed to advise the                  
    Independent Shareholders as to whether the Continuing Connected           
    Transactions are in the interests of the Company and are fair             
    and reasonable so far as the Independent Shareholders are                 
    concerned. An independent financial adviser has been appointed            
    to advise the independent board committee on the terms of the             
    Continuing Connected Transactions.                                        
                                                                              
    A circular containing, among other things, information relating           
    to the Continuing Connected Transactions, a letter from the               
    independent financial adviser, the recommendation of the                  
    independent board committee, and a notice convening the EGM will          
    be despatched to the shareholders of the Company as soon as               
    practicable.                                                              
                                                                              
    DEFINITIONS                                                               
                                                                              
    In this announcement, unless the context otherwise requires,              
    the following terms shall have the meanings set out below:                
                                                                              
    "Air-conditioners"      :       different types of air-conditioners       
    manufactured by members of the Group from time to time                    
                                                                              
    "associates"    :       has the meaning as ascribed thereto under the     
    Listing Rules                                                             
                                                                              
    "Company"       :       Hualing Holdings Limited, a limited company       
    incorporated in Hong Kong, whose shares are listed on the main            
    board of the Stock Exchange                                               
                                                                              
    "connected person"      :       has the meaning as ascribed thereto under 
    the Listing Rules                                                         
                                                                              
    "Continuing Connected   :       the continuing connected transactions     
        Transactions"               between the Group and Midea Electric      
                                    Group pursuant to the Master Agreement    
                                                                              
    "Directors"     :       the directors of the Company                      
                                                                              
    "EGM"   :       an extraordinary general meeting of the Company to be     
    convened for the purpose of considering and passing by the                
    Independent Shareholders of the ordinary resolution approving             
    the Continuing Connected Transactions                                     
                                                                              
    "Group" :       the Company and its subsidiaries                          
                                                                              
    "HK$"   :       Hong Kong dollars, the lawful currency of Hong Kong