09:26     <00012> & <00246> - Joint Ann. & HENDERSON CHINA Resumed(2)         

    Lee Ka Shing, all of whom are directors of HLD. Mr. Jackson Woo Ka        
    Biu is an alternate director of HLD to Sir Po-shing Woo                   
    who is a non-executive director of HLD. Ms. Carmen Woo Ka Man is the      
    daughter of Sir Po-shing Woo and the sister of Mr. Jackson Woo Ka         
    Biu. Canon International Limited, Mr. Jackson Woo Ka Biu and Ms.          
    Carmen Woo Ka Man are presumed to be parties acting in concert with       
    HLD under the Takeovers Code.                                             
                                                                              
    DISPATCH OF SCHEME DOCUMENT                                               
    A scheme document of HCHL containing, inter alia, further details of      
    the Proposal and the Scheme, the expected timetable, an explanatory       
    statement as required under the Companies Act, information regarding      
    HCHL and HLD, valuation reports, the recommendation from Mr. Liang        
    Shangli, the independent director of HCHL with respect to the             
    Proposal and the Scheme, a letter of advice from the independent          
    financial adviser to the independent director of HCHL, a notice of        
    the Court Meeting and a notice of the special general meeting of          
    HCHL, will be dispatched to the Shareholders as soon as practicable       
    and in compliance with the requirements of the Takeovers Code.            
                                                                              
    SUSPENSION AND RESUMPTION OF TRADING                                      
    At the request of HCHL, trading in the Shares on the Stock Exchange       
    was suspended from 9:30 a.m. on 17th May, 2005, pending the issue of      
    this announcement. Application has been made by HCHL to the Stock         
    Exchange for the resumption of trading in the Shares with effect from     
    9:30 a.m. on 20th May, 2005.                                              
                                                                              
    Shareholders and/or potential investors in HCHL should be aware that      
    the implementation of the Proposal and the Scheme is subject to the       
    conditions as set out below being fulfilled or waived, as applicable,     
    and thus the Proposal and the Scheme may or may not become effective.     
    They should therefore exercise caution when dealing in the                
    Shares.                                                                   
                                                                              
                                                                              
    INTRODUCTION                                                              
    On 17th May, 2005, HLD, the controlling shareholder of HCHL, holding      
    through its wholly-owned subsidiaries approximately 65.32% of the         
    issued share capital of HCHL as at the Announcement Date, requested       
    the board of directors of HCHL to put forward a proposal to the           
    Scheme Shareholders regarding a proposed privatisation of HCHL by way     
    of a scheme of arrangement under Section 99 of the Companies Act.         
                                                                              
    TERMS OF THE PROPOSAL                                                     
    The Scheme will provide that the Scheme Shares be cancelled and, in       
    consideration thereof, each Scheme Shareholder will be entitled to        
    receive HK$7.50 in cash for each Scheme Share held.                       
                                                                              
    The Cancellation Price of HK$7.50 per Scheme Share represents:            
                                                                              
    a premium of approximately 56.25% over the closing price of HK$4.80       
    per Share as quoted on the Stock Exchange on 13th May, 2005 (being        
    the last trading day prior to the suspension of trading in the Shares     
    pending the issue of this announcement);                                  
                                                                              
                                                                              
    a premium of approximately 50.91% over the average closing price of       
    approximately HK$4.97 per Share based on the daily closing prices as      
    quoted on the Stock Exchange over the 10 trading days up to and           
    including 13th May, 2005;                                                 
                                                                              
                                                                              
    a premium of approximately 54.00% over the average closing price of       
    approximately HK$4.87 per Share based on the daily closing prices as      
    quoted on the Stock Exchange over the 30 trading days up to and           
    including 13th May, 2005;                                                 
                                                                              
                                                                              
    a premium of approximately 54.32% over the average closing price of       
    approximately HK$4.86 per Share based on the daily closing prices as      
    quoted on the Stock Exchange over the 60 trading days up to and           
    including 13th May, 2005;                                                 
                                                                              
                                                                              
    a premium of approximately 74.42% over the average closing price of       
    approximately HK$4.30 per Share based on the daily closing prices as      
    quoted on the Stock Exchange over the 180 trading days up to and          
    including 13th May, 2005; and                                             
                                                                              
                                                                              
    a discount of approximately 46.28% to the unaudited consolidated net      
    asset value per Share of approximately HK$13.96 as at 31st December,      
    2004.                                                                     
                                                                              
    On the basis of the Cancellation Price, which was arrived at on an        
    arm's length and commercial basis after taking into account the above     
    figures and with reference to other privatisation transactions in the     
    past few years, the Proposal values the entire issued share capital       
    of HCHL as at the Announcement Date at approximately HK$3,733             
    million. The amount of cash required for the Proposal is                  
    approximately HK$1,295 million. HLD intends to finance the cash           
    required for the Proposal from internal resources and/or bank