Beijing Yunji Technology Co., Ltd. — M&A Activity 2002

Mar 1, 2002

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

Harmony Link Corporation

Harmony Link Corporation Cheong Ming Investments Limited (Incorporated in the British Virgin Islands (Incorporated in Bermuda with limited liability) with limited liability)

JOINT ANNOUNCEMENT

ACQUISITION OF SHARES IN CHEONG MING INVESTMENTS LIMITED BY HARMONY LINK CORPORATION UNCONDITIONAL MANDATORY CASH OFFERS BY SOMERLEY LIMITED ON BEHALF OF HARMONY LINK CORPORATION TO ACQUIRE ALL THE ISSUED SHARES OF CHEONG MING INVESTMENTS LIMITED (OTHER THAN THOSE ALREADY OWNED BY HARMONY LINK CORPORATION AND PARTIES ACTING IN CONCERT WITH IT)

On 27th February, 2002, the Offeror acquired a total of 95,440,000 Shares, representing approximately 22.8% of the issued share capital of the Company, for a total consideration of approximately HK$22.91 million (equivalent to HK$0.24 per Share). The Offeror and parties acting in concert with it already owned 135,447,500 Shares, representing approximately 32.4% of the issued share capital of the Company prior to completion of the Share Purchase. Accordingly, upon completion of the Share Purchase, the Offeror and parties acting in concert with it own 230,887,500 Shares, representing approximately 55.2% of the issued share capital of the Company. Accordingly, the Offeror is obliged under the Takeovers Code to make an unconditional mandatory cash offer for all the issued Shares other than those already owned by the Offeror and parties acting in concert with it.

Somerley, on behalf of the Offeror, is making the Offers to acquire all the issued Shares, and to cancel all Options, not already owned by the Offeror and parties acting in concert with it at a price of HK$0.24 per Share and at 0.01 cent per Option Share pursuant to the Takeovers Code.

At the request of the Company, trading in the Shares was suspended as from 10:00 a.m. on 28th February, 2002 and will be resumed with effect from 10:00 a.m. on 1st March, 2002.

– 1 –

BACKGROUND TO THE OFFERS

On 27th February, 2002, the Offeror acquired from the following parties a total of 95,440,000 Shares at a price of HK$0.24 per Share.

Vendors Trianon Capital Limited Gresham Investments Limited Exeter Securities Limited Marsham Limited Total	No. of Shares 17,252,500 29,437,500 17,500,000 31,250,000 95,440,000	% of total issued Shares 4.1% 7.0% 4.2% 7.5%
		22.8%

The Vendors are independent parties not connected or associated with the Group, or the substantial shareholders or directors of any member of the Group or their respective associates.

The Offeror and the Directors have no knowledge of whether any of the Vendors still holds any Shares after completion of the Share Purchase, which took place on 27th February, 2002. However, as at the date of this announcement, according to the register maintained by the Company pursuant to section 16 of the SDI Ordinance and the register of members of the Company, the Directors are not aware that any of the Vendors is a substantial Shareholder of the Company.

The Sale Shares represent approximately 22.8% of the 417,875,000 Shares in issue as at the date of this announcement. The Offeror already owned 130,447,500 Shares (or 31.2% of the issued share capital of the Company) prior to the acquisition of the Sale Shares. In addition, Mr. Lui Shing Cheong (a Director), Mr. Lui Shing Chung, Victor (a Director) and the spouse of Mr. Lui Shing Chung, Victor, who are all acting in concert with the Offeror, own a total of 5,000,000 Shares. Following completion of the Share Purchase, the Offeror and parties acting in concert with it therefore own an aggregate of 230,887,500 Shares, representing approximately 55.2% of the equity interest of the Company. Accordingly, the Offeror is under an obligation pursuant to Rule 26 of the Takeovers Code to make an unconditional mandatory offer for all the issued Shares (other than those already owned by the Offeror and parties acting in concert with it).

– 2 –

UNCONDITIONAL MANDATORY CASH OFFERS

1. In respect of the Shares

Somerley, on behalf of the Offeror, is making an unconditional mandatory offer for the Offer Shares as follows:

For every Offer Share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . HK$0.24 in cash

The price of HK$0.24 for each Offer Share is the same as the purchase price for each Sale Share paid by the Offeror under the Share Purchase.

The offer price of HK$0.24 per Share represents:

• a premium of approximately 2.1% over the closing price of HK$0.235 per Share as quoted on the Stock Exchange on 27th February, 2002, being the last trading day prior to the suspension of trading in the Shares on 28th February, 2002;

• a premium of approximately 0.7% over the average closing price of approximately HK$0.2383 per Share for the last 10 trading days up to and including 27th February, 2002; and

• a discount of approximately 68.0% to the unaudited net tangible asset value per Share of approximately HK$0.75 as at 30th September, 2001 based on the unaudited condensed consolidated balance sheet of the Company as at 30th September, 2001.

2. In respect of employee share options

As at the date of this announcement, the Company has Options granted in respect of a total of 18,000,000 Option Shares. Options in respect of 10,000,000 Option Shares are jointly held by Messrs. Lui Chi (the Chairman of the Company), Lui Shing Ming, Brian (a Director), Lui Shing Chung, Victor, and the spouse of Lui Shing Chung, Victor, all of whom are parties acting in concert with the Offeror. These Options are exercisable at a price between HK$0.35072 and HK$0.224 per Option Share. The remaining Options in respect of 8,000,000 Option Shares are held by other employees of the Group who are not acting in concert with the Offeror. The Options held by the Independent Optionholder are exercisable at a price of HK$2.7744 per Option Share (in respect of 7,500,000 Options), HK$1.096 per Option Share (in respect of 250,000 Options) and HK$1.4048 (in respect of 250,000 Options) and are therefore currently out of money. Somerley, on behalf of the Offeror, is making an offer to pay to the Independent Optionholders a nominal consideration of 0.01 cent in cash in respect of every Option Share to which the Independent Optionholders are entitled to subscribe under the Options held by them, in consideration of the surrender to the Company by the relevant holders of all of the existing rights attaching to their Options, following which such Options will be cancelled and extinguished.

– 3 –

3. Total consideration

At the date of this announcement, the Company has 417,875,000 Shares in issue, of which 186,987,500 Shares (representing approximately 44.7% of the total number of Shares in issue) are held by the Independent Shareholders to whom the Share Offer is being made. Based on the offer price of HK$0.24 per Share, the Share Offer values the entire issued Shares at approximately HK$100.29 million and all the Offer Shares at approximately HK$44.88 million. The total consideration payable under the Option Offer for the cancellation of the Options held by the Independent Optionholders is HK$800.

Somerley is satisfied that there are sufficient financial resources available for the Offeror to meet full acceptance of the Offers.

4. Effect of accepting the Offers

By accepting the Share Offer, Independent Shareholders will sell their Shares, and all rights attached to them, including the right to receive all dividends and distributions declared, made or paid on or after 27th February, 2002. By accepting the Option Offer, Independent Optionholders will surrender to the Company their Options for cancellation by the Company.

5. Settlement of the consideration

Seller’s ad valorem stamp duty at the rate of 0.1% of the consideration (rounded up to the nearest HK$1) will be deducted from the consideration payable to the Independent Shareholders or Optionholders (as the case may be) who accept the Share Offer or the Option Offer (as the case may be).

The amounts due to the Independent Shareholders or the Independent Optionholders (as the case may be) who accept the Offers will be posted by the Offeror within 10 days after the date of receipt by the Hong Kong share registrar of the Company of the valid requisite documents from such Independent Shareholders or Independent Optionholders (as the case may be) in accordance with the Takeovers Code.

INFORMATION ON THE COMPANY

The principal activity of the Company is investment holding. The principal activities of its subsidiaries are investment holding, property holding, printing and manufacturing of paper products, digital printing, commercial printing and provision of translation services.

– 4 –

The audited consolidated profits after tax and minority interests of the Company for the years ended 31st March, 2001 and 31st March, 2000 were approximately HK$1.43 million (representing approximately 0.227 cents per Share after adjusting for the Bonus Issue) and HK$23.27 million (representing approximately 5.80 cents per Share after adjusting for the Bonus Issue) respectively. The audited consolidated net tangible asset value of the Company as at 31st March, 2001 was approximately HK$436.19 million (representing approximately HK$0.68 per Share on the basis of the 510,300,000 Shares then in issue and after adjusting for the Bonus Issue). The unaudited consolidated profit after tax and minority interests of the Company for the six months ended 30th September, 2001 was approximately HK$15.37 million (representing approximately 3.3 cents per Share). The unaudited consolidated net tangible asset value of the Company as at 30th September, 2001 was approximately HK$312.52 million (representing approximately HK$0.75 per Share). In May 2001, 176,000,000 Shares were repurchased by the Company, details of which were set out in the circular of the Company dated 3rd March, 2001. The decrease in the consolidated net tangible asset value of the Company to approximately HK$312.52 million as at 30th September, 2001 was attributable to the reduction in the capital of the Company pursuant to the aforesaid repurchase of Shares by the Company.

INFORMATION ON THE OFFEROR

The Offeror is a company incorporated in the British Virgin Islands. Approximately 48.4% of the issued share capital of the Offeror is held by The Lui Family Company Limited as trustee of The Lui Unit Trust. All units of the Lui Unit Trust (except one unit which is owned by Mr. Lui Shing Ming, Brian) are held by a discretionary trust, the discretionary objects of which include Messrs. Lui Shing Ming, Brian, Lui Shing Chung, Victor, Lui Shing Cheong and other family members of Mr. Lui Chi. Messrs. Lui Shing Ming, Brian, Lui Shing Chung, Victor and Lui Shing Cheong further owns approximately 24.13%, 14.59% and 12.88% of the issued share capital of the Offeror, respectively. Messrs. Lui Chi, Lui Shing Cheong, Lui Shing Ming, Brian and Lui Shing Chung, Victor are also directors of the Offeror.

During the six months period prior to the Share Purchase, neither the Offeror nor any of the parties acting in concert with it had dealt in the Shares.

The terms of the Share Purchase were agreed between the Offeror and the Vendors on commercial basis and the Offers are being made on behalf of Offeror by Somerley pursuant to the Takeovers Code. The Offeror considers that the Share Purchase presented a good opportunity for it to increase its shareholding in the Company at an attractive price.

INTENTIONS OF THE OFFEROR REGARDING THE COMPANY

The Offeror intends that the Group will continue with all its existing businesses. The Offeror does not intend to make any material changes to the management (including the board of Directors) and the businesses of the Group by reason only of the Offers. The Offeror intends that the daily operation of the Group will continue to be carried out by its existing management and there will not be any material changes to the employees of the Group by reason only of the Offers.

– 5 –

MAINTAINING THE LISTING STATUS OF THE COMPANY

The Offeror does not intend to exercise the power of compulsory acquisition. It intends to maintain the listing of the Shares on the Stock Exchange. The Offeror, the Directors and the Company will undertake to the Stock Exchange to take appropriate steps to ensure that not less than 25% of the issued Shares will be held by the public within one month following the close of the Offers.

The Stock Exchange has indicated that it will closely monitor trading in the Shares if, at the close of the Offers, less than 25% of the Shares are held by the public.

If the Stock Exchange believes that:

• a false market exists or may exist in the Shares; or

• there are too few Shares in public hands to maintain an orderly market;

then it will consider exercising its discretion to suspend trading in the Shares.

GENERAL

An independent board committee of the Company will be appointed to consider the Offers. An independent financial adviser will be appointed to advise the independent board committee in this respect. Announcement will be made by the Company when the appointment of the said independent financial adviser has been made. Relevant document(s) setting out the terms of the Offers (together with the acceptance and transfer forms), information on the Company, and the recommendations of the independent board committee and its independent financial adviser regarding the Offers will be sent to the Independent Shareholders and the Independent Optionholders as soon as practicable in accordance with the Takeovers Code.

RESUMPTION OF TRADING IN SHARES

At the request of the Company, trading in the Shares on the Stock Exchange was suspended from 10:00 a.m. on 28th February, 2002 pending release of this announcement. Application has been made by the Company for the resumption of trading in the Shares with effect from 10:00 a.m. on 1st March, 2002.

DEFINITIONS

“associate(s)”

has the meaning given it in the Rules Governing the Listing of Securities on the Stock Exchange

“Bonus Issue”

the bonus issue of a total of 83,575,000 new Shares by the Company to the Shareholders in August 2001 on the basis of one bonus Share for every four Shares then held

“Company” Cheong Ming Investments Limited, a company incorporated in Bermuda with limited liability with its Shares listed on the Stock Exchange

– 6 –

“Directors”

the directors of the Company

“Group”	the Company and its subsidiaries
“Hong Kong”	Hong Kong Special Administrative Region of the
	People’s Republic of China
“Independent	Optionholders other than parties acting in
Optionholders”	concert with the Offeror
“Independent	Shareholders other than the Offeror and parties
Shareholders”	acting in concert with it
“Offers”	the Share Offer and the Option Offer
“Offer Share(s)”	issued Share(s) other than those already owned by the
	Offeror and parties acting in concert with it
“Offeror”	Harmony Link Corporation, a company incorporated in
	the British Virgin Islands on whose behalf the Offers
	will be made
“Option(s)”	outstanding option(s) which have been granted under
	the Company’s share option scheme adopted on 27th
	December, 1996, entitling the holders thereof to subscribe
	for new Shares
“Option Offer”	the unconditional mandatory cash offer being made by
	Somerley, on behalf of the Offeror, to cancel all Options
	not held by parties acting in concert with the Offeror
“Option Share(s)”	Share(s) falling to be issued upon the exercise of the
	Options by the Optionholders
“Optionholders”	holders of Options
“Sale Shares”	the 95,440,000 Shares acquired by the Offeror on 27th
	February, 2002 from the Vendors
“SDI Ordinance”	the Securities (Disclosure of Interests) Ordinance
	(Chapter 396 of the Laws of Hong Kong)
“Share Offer”	the unconditional mandatory cash offer being made by
	Somerley, on behalf of the Offeror, to acquire all the
	issued Shares not already owned by the Offeror or parties
	acting in concert with it

– 7 –

“Share Purchase”

the acquisition of the Sale Shares by the Offeror from the Vendors

“Share(s)” ordinary share(s) of HK$0.10 each in the capital of the Company “Shareholders” holders of Shares “Somerley” Somerley Limited, the financial adviser to the Offeror and an investment adviser and exempt dealer registered under the Securities Ordinance (Chapter 333 of the Laws of Hong Kong) “Stock Exchange” The Stock Exchange of Hong Kong Limited “Takeovers Code” Hong Kong Code on Takeovers and Mergers “Vendors” Trianon Capital Limited, Gresham Investments Limited, Exeter Securities Limited and Marsham Limited “HK$” and “cent(s)” Hong Kong dollar(s) and Hong Kong cent(s) respectively

By Order of the Board of By Order of the Board of Harmony Link Corporation Cheong Ming Investments Limited Lui Shing Cheong Lui Shing Ming, Brian Director Director

Hong Kong, 28th February, 2002

The Directors jointly and severally accept full responsibility for the accuracy of the information contained in this announcement (other than those relating to the Offeror) and confirm, having made all reasonable inquiries, that to the best of their knowledge, opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement (other than those relating to the Offeror), the omission of which would make any statement in this announcement misleading.

The directors of the Offeror jointly and severally accept full responsibility for the accuracy of the information contained in this announcement (other than those relating to the Company) and confirm, having made all reasonable inquiries, that to the best of their knowledge, opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement (other than those relating to the Company), the omission of which would make any statement in this announcement misleading.

Please also refer to the published version of this announcement in the Hong Kong iMail.

– 8 –