Computer And Technologies Holdings Limited — Capital/Financing Update 2005

May 9, 2005

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

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CHINA AEROSPACE INTERNATIONAL HOLDINGS LIMITED 航天科技國際集團有限公司

(Incorporated in Hong Kong with limited liability)

(Stock Code: 31)

MAJOR TRANSACTION-DISPOSAL OF PROPERTY

The Board announced that on 4 May 2005, a Memorandum of Agreement for the sale by the Vendor and purchase by the Purchaser of the Property was entered into between a wholly-owned subsidiary of the Company, the Vendor, and the Purchaser.

Pursuant to the terms of the Memorandum of Agreement, the consideration for the Property is HK$330,000,000. The sale and purchase of the Property is expected to be completed on 30 June 2005.

The Disposal constitutes a major transaction of the Company under Chapter 14 of the Listing Rules. The Disposal requires approval from the Shareholders. A shareholders’ circular containing, among other things, further details relating to the Disposal will be dispatched to the shareholders of the Company as soon as practicable.

At the request of the Company, trading in the shares of the Company has been suspended from 9:30 a.m. on 5 May 2005. Application has been made by the Company to the Stock Exchange for the resumption of trading in the shares of the Company on the Stock Exchange with effect from 9:30 a.m. on 9 May 2005.

MEMORANDUM OF AGREEMENT DATED 4 MAY 2005

Date:

4 May 2005

The Vendor: Well Horn Company Limited, a wholly-owned subsidiary of the Company.

The Purchaser: Global Coin Limited. To the best of the Directors’ knowledge, information and belief after having made all reasonable enquiries, the Purchaser and the ultimate beneficial owner of the Purchaser are Independent Third Parties.

Property: The entire building erected on Subsection 1 of Section O of Kowloon Marine Lot No.40 known as Conic Investment Building, save and except the Excluded Car Parking Spaces not owned by the Vendor. The Property is to be sold on an “as is” basis free from encumbrances but subject to and with the benefit of existing tenancies. Save for such existing tenancies, vacant possession of the other units in the Property shall be delivered to the Purchaser on completion.

The Property was acquired by the Vendor in two lots in April 1983 and September 1988 respectively. From the dates of acquisition of the Property up to July 1997, a portion of the Property was used by the Group as its principal offices while the remaining portion of the Property was leased out.

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Thereafter, only a small portion of the Property was used by the subsidiaries of the Company as their offices. The remaining portion of the Property has been principally an investment property of the Company.

Formal Agreement:

Default:

The Vendor and the Purchaser shall enter into a Formal Agreement of the Property on or before 13 May 2005.

Should the Purchaser fail to pay the Vendor the deposit of HK$23,000,000 as referred to in the Memorandum of Agreement on or before 13 May 2005, the Vendor shall be entitled to keep the deposit of HK$10,000,000 paid by the Purchaser pursuant to the Memorandum of Agreement and the Vendor shall be discharged from further performance of its obligations under the Memorandum of Agreement.

If the Purchaser fails to complete the purchase of the Property in accordance with the Memorandum of Agreement or the Formal Agreement, the Vendor shall be entitled to forfeit all deposits which have been received from the Purchaser and the Vendor shall be discharged from further performance of its obligations under the Memorandum of Agreement and the Formal Agreement.

Consideration:

The consideration for the Property is HK$330,000,000 which has been determined on normal commercial terms and arm’s length negotiations between the Vendor and the Purchaser, and after the Company taking into account the annual rental income from the Property and the market value of other comparable properties.

The net book value of the Property, as shown in the audited financial statements of the Company’s 2004 annual report was approximately HK$184,100,000. The net profits (both after taxation and extraordinary items) attributable to the Property for the last two financial years ended 31 December 2003 and 31 December 2004 were approximately HK$5,375,380 and HK$237,120 respectively.

Based on the valuation report conducted by Dudley Surveyors Limited, an independent property valuer appointed by the Vendor, the current open market value based on the existing state of the Property as at 3 May 2005 was approximately HK$191,200,000.

Upon completion of the Disposal, the Vendor will realize a gain of approximately HK$145,000,000 net of expenses in its profit and loss accounts (subject to auditors’ final confirmation). The Directors including the Independent Non-Executive Directors consider that the terms of the Disposal, including the consideration, are fair and reasonable and in the interests of the Company and its shareholders as a whole.

The purchase price shall be paid in cash by the Purchaser to the Vendor in the following manner:

• (a) an initial deposit in the sum of HK$10,000,000 has been paid upon the signing of the Memorandum of Agreement;

• (b) a further deposit in the sum of HK$23,000,000 shall be paid upon signing of the Formal Agreement on or before 13 May 2005; and,

• (c) the balance of the purchase price of HK$297,000,000 shall be paid upon Completion which shall take place on or before 30 June 2005.

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Deed of Release:

Under the 1997 Memorandum, Premier Property Limited (“Premier”), Cheung Kong (Holdings) Limited (“CKH”) and the Vendor agreed to jointly develop the Property. The 1997 Memorandum was a framework agreement that reflected the preliminary intention of the parties to develop the Property. No money was spent pursuant to the framework agreement. As a result of change in the property market since mid-1997, the development of the Property was not carried out.

The Purchaser approached the Vendor with a view to purchasing the Property. There was a mutual understanding between the Vendor, Premier and CKH that their rights and obligations pursuant to the 1997 Memorandum should cease on completion of the sale and purchase of the Property. Therefore, the Purchaser and the Vendor agreed that on completion of the sale and purchase of the Property, the Vendor shall execute and the Purchaser shall procure from Premier and CKH a Deed of Release to be executed by Premier and CKH and the Vendor, who will each thereby release, discharge and waive their respective rights to pursue any claims against each other under the 1997 Memorandum and any matters howsoever arising connected therewith. As such, the rights and obligations under the 1997 Memorandum would no longer be enforceable.

REASONS FOR THE DISPOSAL

After due and careful consideration, the Directors believe that the Disposal represents a good opportunity for the Company to realize the Property at a reasonable price, thus enabling the Company to reduce its borrowings and increase its working capital.

APPLICATION OF SALE PROCEEDS FROM THE DISPOSAL

The entire sale proceeds generated from the Disposal will firstly be utilized by the Company to repay the Property’s mortgage loan. The outstanding principal (excluding interest) on the mortgage of the Property as at 18 April 2005 was approximately HK$128,920,000. The remaining sale proceeds of approximately HK$201,080,000 shall be used by the Company as general working capital.

COMPLETION DATE

Completion of the sale and purchase of the Property is expected to take place on 30 June 2005.

EGM

The Disposal requires approval from the Shareholders. The EGM will be convened as soon as practicable and an ordinary resolution will be proposed to the Shareholders to approve the Disposal.

INFORMATION ON THE COMPANY AND THE PURCHASER

The principal activity of the Company is investment holding and the activities of its principal subsidiaries consist of design, manufacturing and distribution of printed circuit boards, plastic moulding products, LCD and intelligent battery chargers.

To the best of the Directors’ knowledge, the principal business activity of the Purchaser is property investment.

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GENERAL

The Disposal constitutes a major transaction of the Company under Chapter 14 of the Listing Rules. A shareholders’ circular containing, amongst other things, further details relating to the Disposal will be dispatched to the shareholders of the Company as soon as practicable.

SUSPENSION AND RESUMPTION OF TRADING

At the request of the Company, trading in the shares of the Company has been suspended from 9:30 a.m. on 5 May 2005. Application has been made by the Company to the Stock Exchange for the resumption of trading in the shares of the Company on the Stock Exchange with effect from 9:30 a.m. on 9 May 2005.

DEFINITIONS

“1997 Memorandum”	means the memorandum of agreement and a supplement both dated 28
	January 1997 (as amended by letter dated 13 July 1999) between Premier
	Property Limited, Cheung Kong (Holdings) Limited (both are Independent
	Third Parties) and the Vendor, whereby the parties agreed to jointly develop
	the Property;
“Board”	means the board of Directors of the Company;
“Company”	means China Aerospace International Holdings Limited, a company
	incorporated in Hong Kong with limited liability;
“Deed of Release”	means a deed of release to be executed by Premier Property Limited,
	Cheung Kong (Holdings) Limited and the Vendor on completion of the
	sale and purchase of the Property whereby they will each thereby release,
	discharge and waive their respective rights to pursue any claims against
	each other under the 1997 Memorandum and any matters howsoever arising
	connected therewith;
“Directors”	means the directors of the Company;
“Disposal”	means the disposal of the Property by the Vendor in favour of the Purchaser
	in accordance with the terms of the Memorandum of Agreement;
“EGM”	means an extraordinary general meeting of the Company to be convened;
“Excluded Car Parking	means the following car parking spaces located within the
Spaces”	Property and not owned by the Vendor:

• (1) Private Car Parking Spaces Nos.1, 2, 3, 4, 5, 6, 15 and 16 on the Upper Basement;

• (2) Lorry Car Parking Space No.1 on the Upper Basement;

• (3) Car Park No.L02 on the Upper Basement; and,

• (4) Lorry Car Parking Space Nos.3, 4, 5 and 6 on the Upper Basement;

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“Formal Agreement”	means the formal agreement for the sale by the Vendor and purchase by
	the Purchaser of the Property to be executed on or before 13 May 2005;
“Group”	means the Company and all its subsidiaries;
“HK$”	means Hong Kong Dollars, the lawful currency of Hong Kong;
“Hong Kong”	means the Hong Kong Special Administrative Region of the People’s
	Republic of China;
“Independent	means the independent non-executive directors of the
Non-Executive	Company, comprising Mr. Lee Hung Sang, Mr. Chow Chan
Directors”	Lum, Charles and Mr. Luo Zhengbang;
“Independent Third	means persons who are not connected persons (as defined in the
Party(ies)”	Listing Rules) of the Company and are third parties independent of and not
	connected with the Company or its connected persons (as defined in the
	Listing Rules);
“Listing Rules”	means the Rules Governing the Listing of Securities on The Stock Exchange
	of Hong Kong Limited;
“Memorandum of	means the memorandum of agreement dated 4 May 2005 relating
Agreement”	to the Property entered into between the Vendor and the Purchaser;
“Property”	means the entire building erected on Subsection 1 of Section O of Kowloon
	Marine Lot No.40 now known as Conic Investment Building save and
	except for the Excluded Car Parking Spaces which are not owned by the
	Vendor;
“Purchaser”	means Global Coin Limited, a company incorporated under the Laws of
	Hong Kong, an Independent Third Party;
“Shareholders”	means the shareholders of the Company;
“Stock Exchange”	means The Stock Exchange of Hong Kong Limited; and
“Vendor”	means Well Horn Company Limited, a wholly-owned subsidiary of the
	Company.

Made by the order of the Board, the Directors of which individually and jointly accept responsibility for the accuracy of this statement.

By order of the Board Rui Xiaowu Chairman

Hong Kong, 9 May 2005

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As at the date of this announcement, the Board comprises Mr. Rui Xiaowu (Chairman), Mr. Zhao Liqiang, Mr. Zhou Qingquan, Mr. Zhao Yuanchang, Mr. Wu Hongju and Mr. Guo Xianpeng as Executive Directors, Mr. Li Jinsheng, Mr. Xu Shilong and Mr. Chen Dingyi and Ms. Chan Ching Har, Eliza as Non-Executive Directors, Mr. Lee Hung Sang, Mr. Chow Chan Lum, Charles and Mr. Luo Zhenbang as Independent Non-Executive Directors.

“Please also refer to the published version of this announcement in China Daily”

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