10:02     CHINA AEROSPACE<00031> - Announcement & Resumption (1)              

    The Stock Exchange of Hong Kong Limited takes no responsibility for the   
    contents of this announcement, makes no representations 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.                   
                                                                              
    CHINA AEROSPACE INTERNATIONAL HOLDINGS LIMITED                            
    (Incorporated in Hong Kong with limited liability)                        
    (Stock Code: 31)                                                          
                                                                              
    MAJOR TRANSACTION-DISPOSAL OF PROPERTY                                    
                                                                              
    The Board announced that on 4 May 2005, a Memorandum of Agreement for     
    the sale by the Vendor and purchase by the Purchaser of the Property      
    was entered into between a wholly-owned subsidiary of the Company, the    
    Vendor, and the Purchaser.                                                
                                                                              
    Pursuant to the terms of the Memorandum of Agreement, the consideration   
    for the Property is HK$330,000,000. The sale and purchase of the          
    Property is expected to be completed on 30 June 2005.                     
                                                                              
    The Disposal constitutes a major transaction of the Company under         
    Chapter 14 of the Listing Rules. The Disposal requires approval from      
    the Shareholders. A shareholders' circular containing, among other        
    things, further details relating to the Disposal will be dispatched to    
    the shareholders of the Company as soon as practicable.                   
                                                                              
    At the request of the Company, trading in the shares of the Company has   
    been suspended from 9:30 a.m. on 5 May 2005. Application has been made    
    by the Company to the Stock Exchange for the resumption of trading in     
    the shares of the Company on the Stock Exchange with effect from 9:30     
    a.m. on 9 May 2005.                                                       
                                                                              
    MEMORANDUM OF AGREEMENT DATED 4 MAY 2005                                  
                                                                              
    Date:  4 May 2005                                                         
                                                                              
    The Vendor:   Well Horn Company Limited, a wholly-owned subsidiary of     
    the Company.                                                              
                                                                              
    The Purchaser:  Global Coin Limited. To the best of the Directors'        
    knowledge, information and belief after having made all reasonable        
    enquiries, the Purchaser and the ultimate beneficial owner of the         
    Purchaser are Independent Third Parties.                                  
                                                                              
    Property:  The entire building erected on Subsection 1 of Section O of    
    Kowloon Marine Lot No.40 known as Conic Investment Building, save and     
    except the Excluded Car Parking Spaces not owned by the Vendor. The       
    Property is to be sold on an "as is" basis free from encumbrances but     
    subject to and with the benefit of existing tenancies. Save for such      
    existing tenancies, vacant possession of the other units in the           
    Property shall be delivered to the Purchaser on completion.               
                                                                              
    The Property was acquired by the Vendor in two lots in April 1983 and     
    September 1988 respectively. From the dates of acquisition of the         
    Property up to July 1997, a portion of the Property was used by the       
    Group as its principal offices while the remaining portion of the         
    Property was leased out.                                                  
                                                                              
    Thereafter, only a small portion of the Property was used by the          
    subsidiaries of the Company as their offices. The remaining portion of    
    the Property has been principally an investment property of the Company.  
                                                                              
    Formal Agreement:  The Vendor and the Purchaser shall enter into a        
    Formal Agreement of the Property on or before 13 May 2005.                
                                                                              
    Default:  Should the Purchaser fail to pay the Vendor the deposit of      
    HK$23,000,000 as referred to in the Memorandum of Agreement on or         
    before 13 May 2005, the Vendor shall be entitled to keep the deposit of   
    HK$10,000,000 paid by the Purchaser pursuant to the Memorandum of         
    Agreement and the Vendor shall be discharged from further performance     
    of its obligations under the Memorandum of Agreement.                     
                                                                              
      If the Purchaser fails to complete the purchase of the Property in      
    accordance with the Memorandum of Agreement or the Formal Agreement,      
    the Vendor shall be entitled to forfeit all deposits which have been      
    received from the Purchaser and the Vendor shall be discharged from       
    further performance of its obligations under the Memorandum of            
    Agreement and the Formal Agreement.                                       
                                                                              
    Consideration:  The consideration for the Property is HK$330,000,000      
    which has been determined on normal commercial terms and arm's length     
    negotiations between the Vendor and the Purchaser, and after the          
    Company taking into account the annual rental income from the Property