09:45 Y.T. REALTY<00075> & CROSS-HAR(HOLD)<00032> - Joint Ann. (2) To the best knowledge, information and belief of the directors of Cross-Harbour having made all reasonable enquiries, the placee and its ultimate beneficial owners will be independent of Cross-Harbour and its connected persons as defined under the Listing Rules. It is expected that there will only be one placee and the placee will be (i) a professional or an institutional investor which generally includes brokers, dealers and companies (including fund managers), whose ordinary business involves dealing in shares and other securities; or (ii) a corporate entity which regularly invests in shares and other securities. 5. Completion of the Placing Completion of the Placing is not subject to any conditions and is expected to take place on or around 26 May 2005. EFFECT OF THE PLACING The shareholdings in Cross-Harbour before and immediately after the Placing are summarised as follows: At present Immediately after completion of the Placing No. of (approx.) No. of (approx.) Shares Shares Honway 76,392,358 27.26% 69,392,358 24.76% Placee and 203,818,774 72.74% 210,818,774 75.24% other shareholders (Note) ----------------------------------------------------- 280,211,132 100.0% 280,211,132 100.0% ===================================================== Note: As at 24 May 2005, the name of the placee was not entered in the register of Cross-Harbour required to be kept pursuant to section 336 of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong). INFORMATION ON THE CROSS-HARBOUR GROUP Cross-Harbour is a company incorporated in Hong Kong with limited liability, the Shares of which are listed on the Main Board of the Stock Exchange. The principal activities of the Cross-Harbour Group are investment holding (with emphasis on transport infrastructure) and tunnel operation, tunnel management, the operation of driver training centres and the operation of electronic toll collection systems. As at 31 December 2004, the audited consolidated net asset value of Cross-Harbour was HK$1,957,506,000. The audited consolidated net profit before taxation and minority interests of Cross-Harbour for the two years ended 31 December 2003 and 31 December 2004 were HK$123,312,000 and HK$187,352,000 respectively; and the audited net profit after taxation and minority interests of Cross-Harbour for the two years ended 31 December 2003 and 31 December 2004 were HK$87,235,000 and HK$134,979,000 respectively. REASONS FOR THE PLACING AND USE OF PROCEEDS The directors of Y. T. Realty consider that the Placing is a good opportunity for Y. T. Realty to realize part of its investment in Cross-Harbour and will generate further capital resources for the Y. T. Realty Group for future use. It is currently intended that subject to favourable market conditions, Honway shall exercise its conversion rights under the Convertible Note (the current outstanding principal amount being HK$80,457,060) prior to its maturity (being 11 June 2005) to acquire further Shares at a pre-determined conversion price of HK$3.90 which is lower than the Placing Price. The maximum number of Shares which may be converted based on the conversion price of HK$3.90 per Share is 20,630,015 Shares. Particulars of the Convertible Note are set out in Cross-Harbour's circular dated 15 May 2002. The Placing will result in a positive cash flow to the Y. T. Realty Group. The directors of Y. T. Realty consider that the terms of the Placing are fair and reasonable and in the interests of the Y. T. Realty Group and the shareholders of Y. T. Realty as a whole. It is currently intended that the net proceeds from the Placing of approximately HK$50,566,285 will be used as general working capital of the Y. T. Realty Group. DISCLOSEABLE TRANSACTION OF Y. T. REALTY As the amount of the relevant percentage ratios calculated pursuant to rules 14.07(3) and 14.07(4) of the Listing Rules exceeds 5% but is less than 25%, the Placing constitutes a discloseable transaction of