Agile Group Holdings Limited — Proxy Solicitation & Information Statement 2007

Mar 29, 2007

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect about this circular or as to the action to be taken, you should consult a licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Agile Property Holdings Limited, you should at once hand this circular to the purchaser or transferee or to the bank, licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this circular, makes no representation 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 circular.

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Agile Property Holdings Limited

(incorporated in the Cayman Islands with limited liability) (Stock Code: 3383)

DISCLOSEABLE TRANSACTION ACQUISITION OF A PRC COMPANY

A letter from the board of directors of Agile Property Holdings Limited is set out on pages 6 to 14 of this circular.

28 March 2007

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1-5
Letter from the Board
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
The Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7-12
Reasons for, and benefits of, the Acquisition and the Project Acquisition . . . . .	13
Financial effect of the Acquisition and the Project Acquisition . . . . . . . . . . . . .	14
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	14
Additional information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	14
Appendix – General information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	15-18

– i –

DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions have the following meanings:

• “Acquisition” the acquisition of 100% equity interest in the Target Company by Clear Fortune from the Vendors for the Consideration

• “Agreement” the agreement dated 8 March 2007 between Clear Fortune as the purchaser and the Vendors as vendors for the Acquisition, including any subsequent amendments and supplements agreed between the parties thereto

• “associate”

• has the meaning ascribed to it under the Listing Rules

• “Authorities”

• any public, regulatory, governmental agency, authority or any court at the national, provincial, municipal or local level of the PRC, including but not limited to the Ministry of Commerce of the PRC and any other governmental authorities having competent jurisdiction to approve the transactions contemplated under the Agreement, the Project Acquisition Agreement and the New Articles

• “Beihai Jinchang” (Beihai Jinchang Real Estate Development Company Limited*), a company incorporated in the PRC with limited liability and a subsidiary of Zhejiang Jinchang, each of it and its ultimate beneficial owner is, to the best of the knowledge, information and belief of the Directors and having made all reasonable enquiry, an independent third party who is not connected with any promoters, directors, supervisors, chief executive or substantial shareholders of the Company or its subsidiaries or their respective associates

• “Board”

the board of Directors

• “Business Day”

• a calendar day other than Saturday or Sunday on which banks in Hong Kong and Shanghai, the PRC, are open for general business and can also carry on inter-bank deposit and payment businesses

• “Certificate of Approval” has the meaning ascribed to it in this circular

– 1 –

DEFINITIONS

“Clear Fortune”	Clear Fortune Investments Limited, a company
	incorporated in the British Virgin Islands with limited
	liability on 25 January 2006 and is a wholly-owned
	subsidiary of the Company
“Company”	Agile Property Holdings Limited
	( ), a company incorporated in
	the Cayman Islands with limited liability and whose
	shares are listed on the main board of the Stock Exchange
“Completion”	completion of the transactions contemplated under the
	Agreement
“Consideration”	RMB5,000,000 (equivalent to approximately
	HK$5,000,000), being the consideration for the
	Acquisition
“Director(s)”	the director(s) of the Company
“Escrow Account”	has the meaning ascribed to it in this circular
“GFA”	gross floor area
“Group”	the Company and its subsidiaries
“HK$”	Hong Kong Dollar, the legal currency of Hong Kong
“Hong Kong”	The Hong Kong Special Administrative Region of the
	PRC
“Joint Control Account”	has the meaning ascribed to it in this circular
“Latest Practicable Date”	23 March 2007, being the latest practicable date prior to
	the printing of this circular for the purpose of
	ascertaining certain information contained herein
“Listing Rules”	the Rules Governing the Listing of Securities on the
	Stock Exchange, including any subsequent amendments
	and supplements thereto

– 2 –

DEFINITIONS

“Loan Agreement” the loan agreement (No. 519127305001) in respect of the Property dated 21 February 2005 between the Project Company and China Construction Bank Corporation (Shanghai Zhabei Branch) for a loan facility of RMB250,000,000 for a term of around three years from 25 February 2005 to 20 February 2008 “Minimum Balance” has the meaning ascribed to it in this circular “Mr. Chen” (Mr. Chen Qingwei), a PRC national and to the best of the knowledge, information and belief of the Directors and having made all reasonable enquiry, is an independent third party who is not connected with any promoters, directors, supervisors, chief executive or substantial shareholders of the Company or its subsidiaries or their respective associates “Mr. Lu” (Mr. Lu Zanchu), a PRC national and to the best of the knowledge, information and belief of the Directors and having made all reasonable enquiry, is an independent third party who is not connected with any promoters, directors, supervisors, chief executive or substantial shareholders of the Company or its subsidiaries or their respective associates “Ms. Xu” (Madam Xu Xiaozhen*), a PRC national and, to the best of the knowledge, information and belief of the Directors and having made all reasonable enquiry, is an independent third party who is not connected with any promoters, directors, supervisors, chief executive or substantial shareholders of the Company or its subsidiaries or their respective associates “New Articles” has the meaning ascribed to it in this circular “New Business Licence” has the meaning ascribed to it in this circular “Notes” the fixed rate senior notes due 2013 issued by the Company referred to in the announcement dated 1 September 2006 published by the Company “Noteholders” holders of the Notes “PRC” the People’s Republic of China

– 3 –

DEFINITIONS

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----- Start of picture text -----

|||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
|“Project|Acquisition”|the|acquisition|of|100%|equity|interest|in|the|Project|
|Company|by|the|Target|Company|from|the|Project|
|Vendors|for|the|Project|Consideration|in|accordance|with|
|the|Project|Acquisition|Agreement|
|“Project|Acquisition|Agreement”|the|agreement|dated|7|February|2007|between|the|Target|
|Company|as|the|purchaser|and|the|Project|Vendors|as|
|vendors|for|the|Project|Acquisition|including|any|
|subsequent amendments and supplements agreed between|
|the|parties|thereto|
|“Project|Business|Licence”|has|the|meaning|ascribed|to|it|in|this|circular|
|“Project|Company”|(Shanghai|Jinchang|Real|
|Estate|Development|Company|Limited),|a|company|
|established in the PRC with limited liability and currently|
|held|by|Zhejiang|Jinchang,|Beihai|Jinchang|and|Ms.|Xu|
|in|the|proportion|of|40%,|30%|and|30%|respectively|
|“Project|Consideration”|RMB988,824,643|(equivalent|to|approximately|
|HK$988,824,643), being the consideration for the Project|
|Acquisition|
|“Project|Vendors”|Zhejiang|Jinchang,|Beihai|Jinchang|and|Ms.|Xu|
|“Property”|the|property|situated|at|
|14|1/1|(Qiu|1/1,|No.|14|Renmin|Guangchang|
|Jiedao,|Huangpu|District,|Shanghai|City,|the|PRC)|
|“Prospectus”|the|prospectus|dated|5|December|2005|issued|by|the|
|Company|
|“RMB”|Renminbi,|the|legal|currency|of|the|PRC|
|“SFO”|the|Securities|and|Futures|Ordinance|(Chapter|571|of|the|
|Laws|of|Hong|Kong)|
|“Shareholders”|the|shareholders|of|the|Company|
|“Stock|Exchange”|The|Stock|Exchange|of|Hong|Kong|Limited|

----- End of picture text -----

– 4 –

DEFINITIONS

“Target Company” (Zhongshan Yafeng Trading Investment Company Limited), a company established in the PRC with limited liability and currently held by Mr. Chen and Mr. Lu in the proportion of 51% and 49% respectively “Vendors” Mr. Chen and Mr. Lu “Zhejiang Jinchang” (Zhejiang Jinchang Real Estate Group Company Limited), a company incorporated in the PRC with limited liability and each of it and its ultimate beneficial owner is, to the best of the knowledge, information and belief of the Directors and having made all reasonable enquiry, is an independent third party who is not connected with any promoters, directors, supervisors, chief executive or substantial shareholders of the Company or its subsidiaries or their respective associates “%” per cent.

Unless otherwise specified in this circular, amounts denominated in RMB has been translated for the purpose of illustration only, into HK$ at an exchange rate of RMB1.00 = HK$1.00.

• for identification purposes only

– 5 –

LETTER FROM THE BOARD

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Agile Property Holdings Limited

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 3383)

Executive Directors:

Mr. Chen Zhuo Lin (Chairman) Mr. Chan Cheuk Yin (Vice-Chairman and Co-President)

Ms. Luk Sin Fong, Fion (Vice-Chairlady and Co-President)

Mr. Chan Cheuk Hung Mr. Chan Cheuk Hei Mr. Chan Cheuk Nam

Independent non-executive Directors: Dr. Cheng Hon Kwan Mr. Kwong Che Keung, Gordon Mr. Cheung Wing Yui

Registered office: Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands

Principal place of business in the PRC: Agile Hotel Jinyong Road, Sanxiang Town Zhongshan City Guangdong Province PRC Post Code 528463

Place of business in Hong Kong: 20/F 238 Nathan Road Kowloon Hong Kong

28 March 2007

To the Shareholders and to the Noteholders

Dear Sir or Madam,

DISCLOSEABLE TRANSACTION ACQUISITION OF A PRC COMPANY

INTRODUCTION

By an announcement dated 8 March 2007, the Board announced that Clear Fortune, a wholly-owned subsidiary of the Company, entered into the Agreement with the Vendors for the acquisition of 100% equity interest in the Target Company. The Target Company is set up as an investment holding and trading company in the PRC. Upon completion of the Agreement, the Target Company will become a subsidiary of the Company.

– 6 –

LETTER FROM THE BOARD

In addition, the Target Company has entered into the Project Acquisition Agreement with the Project Vendors to acquire 100% equity interest in the Project Company. The Project Company is set up as a property investment holding company in the PRC and owns the land use rights in respect of the Property, subject to the rights under the Loan Agreement.

The transactions contemplated under the Agreement and the Project Acquisition Agreement constitute discloseable transactions for the Company under the Listing Rules and will be subject to the disclosure requirements as set out in Chapter 14 of the Listing Rules. The main purpose of this circular is to provide you with further particulars of the transactions contemplated under the Agreement and the Project Acquisition Agreement.

THE AGREEMENT

Date of the Agreement

8 March 2007

Parties

The Agreement was entered into between:

• (A) Clear Fortune;

• (B) Mr. Chen; and

• (C) Mr. Lu.

To the best of the knowledge, information and belief of the Directors, and having made all reasonable enquiry, each of the Vendors is an independent third party who is not connected with any promoters, directors, supervisors, chief executive or substantial shareholders of the Company or its subsidiaries or their respective associates.

The Acquisition

Pursuant to the Agreement, Clear Fortune has agreed to purchase, and Mr. Chen and Mr. Lu have respectively agreed to sell, 51% and 49% of the equity interest in the Target Company, whose principal business activities include investment holding and trading, for the Consideration, to be divided amongst the Vendors according to their existing proportional equity interest in the Target Company.

Under the Agreement, the Vendors have warranted that at Completion, the Target Company will not have material liabilities, other than its obligations and liabilities under the Project Acquisition Agreement.

– 7 –

LETTER FROM THE BOARD

Consideration

The consideration for the Acquisition amounts to RMB5,000,000 (equivalent to approximately HK$5,000,000) which will be paid in cash by Clear Fortune to the Vendors at the time described in the paragraph entitled “Completion” below. The Consideration was determined after arms length negotiation between the parties with reference to the amount of the registered capital of the Target Company. The Company and Clear Fortune will utilize their own internal resources, including but not limited to part of the net proceeds from the placing of existing Shares and subscription of new Shares described in the announcement dated 10 November 2006 issued by the Company, to finance the payment of the Consideration by Clear Fortune to the Vendors.

The Target Company was established as a local joint venture company by the Vendors with limited liability in the PRC on 2 February 2007 with a total registered capital of RMB5,000,000. According to the audited financial statements of the Target Company as at 12 February 2007, the net asset value of the Target Company was approximately RMB5,000,000 (equivalent to HK$5,000,000). The unaudited net profit/loss before and after taxation of the Target Company from 2 February 2007 to and including 12 February 2007 were Nil.

Completion

Completion of the Agreement will take place on the earlier of (i) the date when the relevant Authorities issue the foreign exchange conversion approval for the Consideration to the Vendors; or the eleventh Business Day after the payment of the Consideration by Clear Fortune to the Vendors. Clear Fortune will be required to pay the Consideration within the period of five Business Days after the issue of a completion notice by the Vendors to Clear Fortune and fulfillment of, and conditional upon, amongst other things, the fulfillment of the following Conditions Precedent (which may be waived by Clear Fortune by notice in writing to the Vendors):

• (1) the Vendors and Clear Fortune have duly executed the Agreement and related documents, authorizations and approvals that are necessary for completion of the transactions contemplated in the Agreement and related documents, including the relevant shareholder’ resolutions and directors resolutions;

• (2) the Authorities having approved the Acquisition in accordance with the terms of the Agreement and the new Articles of the Target Company (“ New Articles ”) without substantive amendments or comments and having issued a Certificate of Approval showing Clear Fortune’s ownership of the entire equity interest in the Target Company (“ Certificate of Approval ”);

• (3) the Authorities having issued a corresponding Business Licence for the Target Company showing that the Target Company has become a wholly foreign-owned enterprise, and the records of the Authorities reflect the transactions contemplated in the Agreement, showing that Clear Fortune as the sole holder of 100% of the registered capital of the Target Company (“ New Business Licence ”);

– 8 –

LETTER FROM THE BOARD

• (4) Clear Fortune having received the following from the Vendors in respect of the Target Company:

• (a) Approval letter from the Authorities relating to the Agreement and the New Articles;

• (b) Certificate of Approval;

• (c) New Articles;

• (d) New Business Licence;

• (e) Registered Capital Verification Report of the Target Company;

• (f) Real Estate Development Enterprise Qualification Certificate for the Project Company;

• (g) Report of the auditors on the Target Company;

• (h) Report of the auditors on the Target Company for the financial period ended 12 February 2007;

• (5) the Agreement and all related documents having been authorised, executed and delivered, and constituted valid and legally binding obligations on the parties thereto;

• (6) the Target Company legally owns 100% of the equity interest in the Project Company and the Project Company is the owner of the land use rights and project development rights to the Property;

• (7) no events of force majeure or material adverse change having occurred at all times up to and including Completion;

• (8) the Vendors having not breached any provisions of the Agreement at all times up to and including Completion; and

• (9) all warranties given by the Vendors under the Agreement remaining true, accurate, complete and not misleading at all times up to and including Completion.

If the Conditions Precedent are not fulfilled within one hundred and twenty (120) days after the date of signing of the Agreement, then Clear Fortune may terminate the Agreement, without prejudice to any claims any of the parties to the Agreement may have for antecedent breaches. Completion is expected to take place on or before 30 April 2007.

The Project Acquisition

On 7 February 2007, the Target Company has entered into the Project Acquisition Agreement with the Project Vendors, pursuant to which the Target Company has agreed to

– 9 –

LETTER FROM THE BOARD

purchase, and Zhejiang Jinchang, Beihai Jinchang and Ms. Xu have respectively agreed to sell, 40%, 30% and 30% of the equity interest in the Project Company, whose principal business activities include property development, operation and leasing, and which owns the land use rights of the Property subject to the rights under the Loan Agreement, for the Project Consideration, to be divided amongst the Project Vendors according to their existing proportional equity interest in the Project Company. To the best of the knowledge, information and belief of the Directors, and having made all reasonable enquiry, each of the Project Vendors and their respective ultimate beneficial owners (for those Project Vendors which are not individuals) is an independent third party who is not connected with any promoters, directors, supervisors, chief executive or substantial shareholders of the Company or its subsidiaries or their respective associates. Upon completion of the Acquisition and the Project Acquisition, the Project Company will become a wholly-owned subsidiary of the Company.

Under the Project Acquisition Agreement, the Project Vendors have agreed that at completion of the Project Acquisition, the Project Company will have a readily available cash balance of not less than RMB100,000,000 without any encumbrance on it (“ Minimum Balance ”). To ensure that the Project Company will have the Minimum Balance in its bank account at Completion, the Project Company will set up an escrow account (“ Escrow Account ”) and the Project Company will deposit a sum not less than the Minimum Balance into the Escrow Account. At the same time and to protect the interest of the Target Company and to ensure that the Minimum Balance is in the Escrow Account at Completion, Zhejiang Jinchang will set up a new bank account jointly controlled by Zhejiang Jinchang and the Target Company (“ Joint Control Account ”) with the same bank where the Escrow Account is established.

At Completion, the Target Company will deposit part of the Consideration equal to RMB500,000,000 into the Joint Control Account, and the Target Company will release its joint control over the Joint Control Account only when the Project Vendors have duly delivered exclusive control of the Escrow Account containing the Minimum Balance without encumbrance over to the Target Company.

Project Consideration

The consideration for the Project Acquisition amounts to RMB988,824,643 (equivalent to approximately HK$988,824,643) which will be paid in cash by the Target Company to the Project Vendors no later than completion of the Project Acquisition, which is expected to take place after Completion. The Project Consideration was determined after arms length negotiation between the parties with reference to the market price of nearby land and properties and the result of the financial due diligence report, legal due diligence report on the Project Company and the Property and independent valuation on the Property and the Project Company issued by a firm of PRC valuers on 22 January 2007, valuing the Property at RMB1,903,095,373.88 (approximately HK$1,903,095,373.88) and the Project Company at RMB1,245,800,000 (approximately HK$1,245,800,000), after taking into account the valuation of the Property and liabilities of the Project Company at RMB657,295,373.88 (approximately HK$657,295,373.88), and giving a discount to the valuation of the Project Company.

– 10 –

LETTER FROM THE BOARD

To the best of the knowledge, information and belief of the Directors, and having made all reasonable enquiry, each of the firm of PRC valuers and its ultimate beneficial owners is an independent third party who is not connected with any promoters, directors, supervisors, chief executive or substantial shareholders of the Company or its subsidiaries or their respective associates.

The Project Company was established as a local joint venture company by the Project Vendors with limited liability in Shanghai, the PRC on 27 November 2002 with a total registered capital of RMB30,000,000. According to the unaudited financial statements of the Project Company as at 31 December 2006, the net asset value of the Project Company was approximately RMB30,000,000 (equivalent to HK$30,000,000). The unaudited net profit/loss before and after taxation of the Project Company from 27 November 2002 to 31 December 2006 were Nil.

Source of Funding for the Project Acquisition

After Completion, the Company and Clear Fortune will utilize their own internal resources, including but not limited to part of the net proceeds from the placing of existing Shares and subscription of new Shares described in the announcement dated 10 November 2006 issued by the Company, to finance the payment of the Project Consideration by the Target Company to the Project Vendors.

Completion of the Project Acquisition Agreement

Completion of the Project Acquisition Agreement will take place after Completion and within the period of five Business Days after issue of a completion notice by the Project Vendors to the Target Company and fulfillment of, and conditional upon, amongst other things, the fulfillment of, the following Conditions Precedent (which may be waived by the Target Company in writing to the Project Vendors):

• (1) the Project Vendors and Zhejiang Huanyu Jianshe Group (the contractors engaged to undertake various preliminary foundation and construction works on the Property) having executed the Project Construction Costs Clearance Agreement, an agreement which will set out, amongst other things, the settlement and clearance of all costs and expenses charged by Zhejiang Huanyu Jianshe Group for various preliminary foundation and construction works on the Property;

• (2) the Project Vendors having executed all authorizations and approvals of the Project Company that are necessary for completion of the transactions contemplated in the Project Acquisition Agreement and related documents, including the relevant shareholders’ resolutions and directors resolutions;

• (3) the Authorities having approved the Project Acquisition on the terms set out in the Project Acquisition Agreement and the Authorities having issued a corresponding Business Licence for the Project Company showing the Target Company as the sole holder of 100% of the registered capital of the Project Company (“ Project Business Licence ”);

– 11 –

LETTER FROM THE BOARD

• (4) the Target Company having received the following from the Project Vendors in respect of the Project Company:

• (i) Project Business Licence;

• (ii) Registered Capital Verification Report of the Project Company;

• (iii) Real Estate Development Enterprise Qualification Certificate for the Project Company;

• (iv) Auditors’ Report on the Project Company;

• (v) Auditors’ Report on the Project Company for the financial period ended 12 January 2007;

• (vi) Confirmation from Zhejiang Jinchang that as at 12 January 2007, it is indebted to the Project Company of an amount equal to RMB107,106,355.73; and

• (vii) Confirmation from Zhejiang Huanyu Jianshe Group that as at 12 January 2007, the Company has incurred RMB34,500,000 costs in construction and foundation works;

• (5) the Project Acquisition Agreement and all related documents having been authorised, executed and delivered, and constitute valid and legally binding obligations on the parties thereto;

• (6) no events of force majeure or material adverse change having occurred at all times up to and including completion of the Project Acquisition Agreement; and

• (7) the Project Vendors have not breached any provisions of the Project Acquisition Agreement at all times up to and including completion of the Project Acquisition Agreement.

Under the Loan Agreement, consent of China Construction Bank Corporation (Shanghai Zhabei Branch) is required for any change of control of the Project Company, breach of which would result in the loan (principal and interest all inclusive) borrowed by the Project Company under the Loan Agreement to become immediately due and payable to China Construction Bank Corporation (Shanghai Zhabei Branch).

If the conditions precedent to the Project Acquisition Agreement are not fulfilled within one hundred and twenty (120) days after the date of signing of the Project Acquisition Agreement, then the Target Company may terminate the Project Acquisition Agreement, without prejudice to any claims any of the parties to the Project Acquisition Agreement may have for antecedent breaches. Completion of the Project Acquisition Agreement is expected to take place on or before 31 May 2007, but after Completion.

– 12 –

LETTER FROM THE BOARD

REASONS FOR, AND BENEFITS OF, THE ACQUISITION AND THE PROJECT ACQUISITION

The Group is one of the leading property development companies in the PRC. The Group focuses on the development and sale of high-quality private residential properties in the PRC and engages primarily in the development of large-scale property projects comprising multiple phases and offers a broad range of products, including low-density units (comprising stand-alone houses, semi-detached houses and townhouses), duplexes and apartments which appeal to customers of varying income levels. The majority of the Group’s products target middle and upper-middle class purchasers, including white collar workers, mid-level and senior-level managers, entrepreneurs and civil servants. In addition to residential properties, the Group develops commercial properties, including retail shops complementary to the residential developments of the Group as well as commercial complexes in strategic locations. The Group also engages in ancillary property-related businesses such as property management and decoration service.

The Target Company was established as a local joint venture company by the Vendors with limited liability in the PRC on 2 February 2007 and the principal business activities of the Target Company include investment holding and trading. The Target Company has entered into the Project Acquisition Agreement with the Project Vendors on 7 February 2007 and on its completion, the Project Company will become a wholly-owned subsidiary of the Target Company.

The Project Company was established as a local joint venture company by the Project Vendors with limited liability in Shanghai, the PRC on 27 November 2002 and the principal business activities of the Project Company include property development, operation and leasing, and owns the land use rights of the Property subject to the rights under the Loan Agreement.

The Property is situated at 14 1/1 (Qiu 1/1, No. 14 Renmin Guangchang Jiedao, Huangpu District, Shanghai City, the PRC*), with a total site area of 13,192 square metres and a total gross floor area of 114,358 square metres. Under the land use rights agreement relating to the Property in favour of the Project Company, the term of the land use rights is fifty years from 13 November 1999 to 12 November 2049. The Property is located in one of the busiest commercial centres in Shanghai, the PRC, on the north-western side of the Nanjing Road pedestrian walkway in Shanghai, better known as “The Top Commercial Street in China”. On the eastern side of the Property, it is connected to Xicang Road, and on its southern side, Fengyang Road. The Property is only about 300 metres from the Shanghai People’s Government Offices. Cultural buildings such as The People’s Square, Shanghai Museum, Shanghai Big Theatre and Daguanming Cinema are all within walking distances from the Property, and management believes that this is an invaluable piece of property with unlimited business potential. The Property is held by the Project Company subject to the rights of China Construction Bank Corporation (Shanghai Zhabei Branch) under the Loan Agreement.

After completion of the Acquisition and the Project Acquisition, the Company intends to construct an elegant main building of around 137.8 metres and an ancillary building on the Property, combining commercial areas, office and hotel into one mega multi-purpose development.

– 13 –

LETTER FROM THE BOARD

The Directors consider that the Acquisition contemplated under the Agreement is in line with the Group’s principal activities and believe the Acquisition and the Project Acquisition will increase the Group’s competitiveness in the property development market by providing the Group with a good opportunity to strengthen and diversify its business to other parts of the PRC.

The Directors believe that the terms of the Agreement are made on an arm’s length basis and on normal commercial terms, and are made in the ordinary and usual course of business of the Group and are fair and reasonable and in the interest of the Shareholders as a whole.

FINANCIAL EFFECT OF THE ACQUISITION AND THE PROJECT ACQUISITION

Upon completion of the Acquisition and the Project Acquisition, the Group will be interest in 100% of the registered capital of the Target Company and the Project Company. The Target Company and the Project Company will become the wholly-owned subsidiaries of the Company and their results and state of affairs will be included in the consolidated accounts of the Group. It is expected that with the effect of Acquisition and the Project Acquisition, there will only be a minor decrease in the earnings of the Group in respect of certain incidental expenses to the Acquisition and the Project Acquisition not capitalised under certain applicable accounting standards. Both assets and liabilities of the Group will be increased because of the Acquisition and the Project Acquisition but they will not have any material impact on the net asset position of the Group.

GENERAL

Based on the Consideration of the Acquisition of RMB5,000,000 (approximately HK$5,000,000) and the possible obligations and liabilities of the Target Company, which will become a subsidiary of the Company on Completion, for payment of the Project Consideration for the Project Acquisition at RMB988,824,643 (approximately HK$988,824,643), the fair market value of the Property owned by the Target Company with reference to an independent valuation on the Property and the Project Company issued by a firm of PRC valuers on 22 January 2007, valuing the Property at RMB1,903,095,373.88 (approximately HK$1,903,095,373.88) and the total assets of the Company based on the unaudited consolidated accounts of the Company for the six months ended 30 June 2006, the Agreement (when taken together with the payment obligations of the Target Company under the Project Acquisition Agreement) constitutes a discloseable transaction of the Company under Chapter 14 of the Listing Rules.

ADDITIONAL INFORMATION

Your attention is drawn to the general information set out in the Appendix to this circular.

Yours faithfully, For and on behalf of the Board WAI Ching Sum Company Secretary

* for identification purposes only

– 14 –

GENERAL INFORMATION

APPENDIX

RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief, there are no other facts the omission of which would make any statement herein misleading.

DISCLOSURE OF INTERESTS

(a) Directors and chief executive

As at the Latest Practicable Date, the interests and short positions of the Directors and chief executive of the Company in the shares, underlying shares and debentures of the Company and its associated corporations (within the meaning of Part XV of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO) or were required, pursuant to section 352 of the SFO, to be entered in the register referred to therein or were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers of the Listing Rules, to be notified to the Company and the Stock Exchange were as follows:

				Approximate percentage
	Capacity in which such	**Number of **	Shares	of existing issued share
Name of Director	interests were held	Long position	Short position	capital of the Company
Chen Zhuo Lin	Beneficiary of a trust	2,180,530,000	–	58.21%
Chan Cheuk Yin	Beneficiary of a trust	2,180,530,000	–	58.21%
Luk Sin Fong, Fion	Beneficiary of a trust	2,180,530,000	–	58.21%
Chan Cheuk Hung	Beneficiary of a trust	2,180,530,000	–	58.21%
Chan Cheuk Hei	Beneficiary of a trust	2,180,530,000	–	58.21%
Chan Cheuk Nam	Beneficiary of a trust	2,180,530,000	–	58.21%

Notes: The interests of Mr. Chen Zhuo Lin, Mr. Chan Cheuk Yin, Ms. Luk Sin Fong, Fion, Mr. Chan Cheuk Hung, Mr. Chan Cheuk Hei and Mr. Chan Cheuk Nam represented 2,180,530,000 Shares held by Top Coast Investment Limited (“Top Coast”) on a family trust in favor of them.

Save as disclosed above, as at the Latest Practicable Date, none of the Directors or chief executive of the Company held any interests or short positions in the shares, underlying shares or debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO) or were required, pursuant to section 352 of the SFO, to be entered in the register referred to therein or were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers of the Listing Rules, to be notified to the Company and the Stock Exchange.

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GENERAL INFORMATION

APPENDIX

(b) Substantial shareholders

As at the Latest Practicable Date, according to the register of interests kept by the Company under section 336 of the SFO and so far as was known to the Directors and chief executive of the Company, the following persons (other than a Director or chief executive of the Company) had an interest or short position in the Shares and underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or, who were, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital (including any options in respect of such capital) carrying rights to vote in all circumstances at general meetings of any other member of the Group:

			Approximate percentage
	Capacity in which such	Number of Shares or	of existing issued share
Name of Shareholder	interests were held	underlying Shares	capital of the Company
Top Coast	Trustee	2,180,530,0001	58.21%
Lu Yanping	Interest of spouse	2,180,530,0002	58.21%
Lu Liqing	Interest of spouse	2,180,530,0003	58.21%
Chan Siu Na	Interest of spouse	2,180,530,0004	58.21%
Zheng Huiqlong	Interest of spouse	2,180,530,0005	58.21%

Notes:

1. This represented 2,180,530,000 Shares held by Top Coast on a family trust with Mr. Chen Zhuo Lin, Mr. Chan Cheuk Yin, Ms. Luk Sin Fong, Fion, Mr. Chan Cheuk Hung, Mr. Chan Cheuk Hei and Mr. Chan Cheuk Nam being the benieficiaries.

2. This represented 2,180,530,000 Shares held by Top Coast on a family trust with her husband, Mr. Chan Cheuk Hei, being one of the beneficiaries.

3. This represented 2,180,530,000 Shares held by Top Coast on a family trust with her husband, Mr. Chan Cheuk Hung, being one of the beneficiaries.

4. This represented 2,180,530,000 Shares held by Top Coast on a family trust with her husband, Mr. Chan Cheuk Nam, being one of the beneficiaries.

5. This represented 2,180,530,000 Shares held by Top Coast on a family trust with her husband, Mr. Chan Cheuk Yin, being one of the beneficiaries.

According to the register of interests kept by the Company under section 336 of the SFO and so far as was known to the Directors and chief executive of the Company, save as disclosed above, there were no other persons (other than the Directors or chief executive of the Company) who, as at the Latest Practicable Date, had an interest or short position in the Shares or underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or, who were, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group or in any options in respect of such capital.

LITIGATION

As at the Latest Practicable Date, no member of the Group is engaged in any litigation or claims of material importance that is still subsisting and no litigation or claims of material importance is known to the Directors to be pending or threatened by or against any member of the Group.

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GENERAL INFORMATION

APPENDIX

SERVICE CONTRACTS

Each of the executive Directors has entered into a service contract with the Company for a term of three years commencing from the Listing Date until terminated by not less than three months’ notice in writing served by either party on the other. Each of the executive Directors is entitled to their respective basic salaries set out below. The executive Directors are entitled to participate in the Company’s medical benefit and accident insurance scheme. In addition, the executive Directors are entitled to participate in the Company’s retirement scheme. Furthermore, the executive Directors will also be entitled to use a company car which is, in the opinion of the Board, suitable to his position, and be reimbursed all reasonable expenses incurred in relation to the company car (including fuel, maintenance and insurance).

Each of the independent non-executive Directors has entered into an appointment letter with the Company commencing from 15 December 2006 to 30 June 2008. Each of the independent non-executive Directors is entitled to their respective annual fees set out below. The appointments are subject to the provisions of retirement and rotation of Directors under the Articles.

An aggregate of approximately RMB1,200,000 (approximately HK$1,152,000) was paid to the Directors as remuneration for the year ended 31 December 2004. The annual director’s fees and remuneration of the executive and non-executive Directors for the year 31 December 2005 are as follows:

	Annual
Name of Director	director’s fee
	(HK$)
Executive Directors
Chen Zhuo Lin	393,000
Chan Cheuk Yin	492,000
Luk Sin Fong, Fion	492,000
Chan Cheuk Hung	440,000
Chan Cheuk Hei	440,000
Chan Cheuk Nam	440,000
Independent non-executive Directors
Cheng Hon Kwan	28,000
Kwong Che Keung, Gordon	28,000
Cheung Wing Yui	28,000

Under the arrangement currently in force, the aggregate amount of emoluments payable by the Group to the Directors for the year ending 31 December 2006 will be approximately RMB21,644,000 (approximately HK$21,664,000).

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GENERAL INFORMATION

APPENDIX

COMPETING INTERESTS

Save as disclosed in the Prospectus (if any), as at the Latest Practicable Date, none of the Directors or their respective associate(s) (as defined in the Listing Rules) was interested in any business which competes or is likely to compete, either directly or indirectly, with the business of the Group.

MISCELLANEOUS

• (a) The secretary of the Company is Wai Ching Sum, who is a fellow member of The Institute of Chartered Secretaries and Administrators in United Kingdom and The Hong Kong Institute of Chartered Secretaries; the qualified accountant of the Company is Chu Hau Lim, who is a fellow member of The Association of Chartered Certified Accounts and an associate member of the Hong Kong Institute of Certified Public Accountants.

• (b) The registered office of the Company is located at Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman KY1-111, Cayman Islands. The principal place of business of the Company in the PRC is located at Agile Hotel, Jinyong Road, Sanxiang Town, Zhongshan City, Guangdong Province, Post Code 528463, PRC. The place of business of the Company in Hong Kong is located at 20/F, 238 Nathan Road, Kowloon, Hong Kong.

• (c) The Hong Kong branch share registrar and transfer office of the Company is Tricor Investor Services Limited of 26th Floor, Tesbury Centre, 28 Queen’s Road East, Hong Kong.

• (d) The English text of this circular shall prevail over the Chinese text in case of inconsistency.

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