10:36 GEELY AUTO<00175>-Announcement & Resumption of Trading (5) The Group is principally engaged in the manufacturing and trading of automobile parts and related automobile components in the PRC. The following is a summary of the Group's audited financial results for each of the two years ended 31 December 2004: For the year ended 31 December 2003 2004 HK$'000 HK$'000 Turnover 39,872 41,123 Profit attributable to shareholders 57,486 84,394 The audited consolidated net asset value of the Group amounted to approximately HK$653.4 million as at 31 December 2004. INFORMATION ON THE OFFEROR The Offeror is a private company incorporated in the British Virgin Islands with limited liability. Since its incorporation, the Offeror has not carried out any business activity other than its indirect beneficial interest in the Company and the cash equivalent assets, which are designated for making the Offer. Mr. Li is the sole shareholder and sole director of the Offeror. Information relating to Mr. Li is set out in the section headed "Directors and management" below. Prior to Completion and as at the date of this announcement, the Offeror was interested in 32% of the issued share capital of Proper Glory. Following Completion, the Offeror and parties acting in concert with it will be interested in the entire issued share capital of Proper Glory, which in turn holds 2,500 million Shares, representing approximately 60.68% of the issued share capital of the Company. REASONS FOR MAKING THE OFFER The Offeror considers that the Share Transfer Agreement presented an opportunity for it to gain a controlling interest in the Company. Upon Completion, the beneficial shareholding interests of the Offeror and parties acting in concert with it collectively will amount to approximately 60.68%, and is therefore obliged under Rule 26 of the Takeovers Code to make a unconditional mandatory cash offer to acquire all the issued Shares other than those already owned by the Offeror or parties acting in concert with it. INTENTIONS OF THE OFFEROR REGARDING THE GROUP Business The Offeror intends that the Group will continue with all of its existing businesses. The Offeror does not intend to make any material changes to the businesses of the Group or to redeploy any fixed assets of the Company following the closing of the Offer. As at Completion, the Offeror is the ultimate controlling Shareholder and thus a connected person of the Company, any proposed acquisition of assets from or to the Offeror will constitute connected transactions for the Company under the Listing Rules and will be subject to the provisions of the Listing Rules and as the case may be, the approval of independent Shareholders other than the Offeror and its associates at an extraordinary general meeting of the Company. There is no concrete plan as to any proposed acquisition of assets from or to the Offeror or any of its associates following the closing of the Offer. Directors and management The Board is currently made up of 10 Directors, comprising eight executive Directors and two independent non-executive Directors. Upon closing of the Offer, six of the existing executive Directors namely, Mr. He, Messrs. Xu Xing Yao, Ku Wai Kwan, Zhou Teng, Zhang Zhe and Wong Hing Kwok will resign. Upon Completion, seven executive Directors will be nominated by the Offeror to the Board. Biographical details of the seven proposed executive Directors are as follows: Mr. Li Shu Fu, aged 42, is the controlling shareholder, founder, chairman of the board of Zhejiang Geely Holding Limited (a company incorporated in the PRC, and is ultimately owned by Mr. Li and his associates). Zhejiang Geely Holding Limited and its subsidiaries are principally engaged in manufacturing and sales of automobiles in the PRC. Mr. Li is also the chairman of the two associated companies of the Company namely, Zhejiang Geely JV and Shanghai Maple JV. Mr. Li has over 20 years of experience in the investment and management of the automobile manufacturing business and real estate business in the PRC. Mr. Li is a member of the Chinese People's Political Consultative Conference. Mr. Li holds a master degree in engineering from Yan Shan University.