10:26     HUALING<00382> - Announcement & Resumption (4)                      

    Shareholders as soon as practicable, subject to the conditions            
    of the Rights Issue being satisfied.                                      
                                                                              
    PROPOSED RIGHTS ISSUE                                                     
                                                                              
    Issue statistics                                                          
                                                                              
    Basis of the Rights Issue       :       Three Rights Shares for every     
    two existing Shares held on the Record Date                               
                                                                              
    Number of existing Shares in issue      :       1,588,036,408 Shares      
    as at the date of this announcement                                       
                                                                              
    Number of Rights Shares :       2,382,054,612 Rights Shares (Note)        
                                                                              
    Note:    This figure is calculated on the assumption that no              
    outstanding share options granted by the Company are exercised            
    on or before the Record Date.                                             
                                                                              
    The nil-paid Rights Shares proposed to be provisionally allotted          
    pursuant to the terms of the Rights Issue represents 150% of              
    the Company's existing issued share capital and approximately             
    60% of the Company's enlarged issued share capital of the Company         
    immediately following completion of the Rights Issue.                     
                                                                              
    The number of Rights Shares which may be issued pursuant to the           
    Rights Issue will be increased in proportion to any additional            
    new Shares which may be issued and allotted pursuant to the 1993          
    Share Option Scheme on or before the Record Date. As at the date          
    of this announcement, there are 960,000 outstanding share                 
    options granted pursuant to the 1993 Share Option Scheme. If              
    all the subscription rights attaching to the outstanding share            
    options are duly exercised and Shares are issued and allotted             
    pursuant to such exercise on or before the Record Date, the number        
    of issued Shares is expected to be increased to 1,588,996,408             
    and the number of Rights Shares that may be issued pursuant to            
    the Rights Issue is expected to be increased to 2,383,494,612.            
                                                                              
    Subscription Price                                                        
                                                                              
    The Subscription Price for the Rights Shares is HK$0.10 per               
    Rights Share, payable in full when a Qualifying Shareholder               
    accepts his/her provisional allotment under the Rights Issue              
    or applies for excess Rights Shares or when a transferee of               
    nil-paid Rights Shares subscribes for the Rights Shares.                  
                                                                              
    The Subscription Price                                                    
                                                                              
    -       represents a discount of approximately 56.5% to the closing       
    price of HK$0.23 per Share as quoted on the Stock Exchange on             
    the Last Trading Date;                                                    
                                                                              
    -       represents a discount of approximately 57.5% to the average       
    closing price of approximately HK$0.2351 per Share for the 10             
    consecutive trading days up to and including the Last Trading             
    Date; and                                                                 
                                                                              
    -       represents a discount of approximately 34.2% to the               
    theoretical ex-rights price of HK$0.152 per Share based on the            
    closing price as quoted on the Stock Exchange on the Last Trading         
    Date.                                                                     
                                                                              
    The Subscription Price was arrived at after arm's length                  
    negotiation between the Company and Midea International with              
    reference to the market price of the Shares and the recent                
    financial conditions of the Group. As disclosed in the Company's          
    2004 annual results announcement dated 22 April 2005, the Group           
    recorded a consolidated net loss of approximately HK$629 million          
    for the year ended 31 December 2004 and the shareholders' deficit         
    of the Group