CR Construction Group Holdings Limited — M&A Activity 2000

May 24, 2000

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.

MR. TSIM WING KONG

UNCONDITIONAL MANDATORY CASH OFFERS BY

VICKERS BALLAS HONG KONG LIMITED

AND

TAI FOOK SECURITIES COMPANY LIMITED

ON BEHALF OF

MR. TSIM WING KONG

TO ACQUIRE ALL THE ISSUED SHARES AND OPTIONS OF

KEL HOLDINGS LIMITED

(OTHER THAN THOSE ISSUED SHARES AND OPTIONS ALREADY OWNED OR CONTROLLED BY MR TSIM WING KONG

OR PARTIES ACTING IN CONCERT WITH HIM)

SUMMARY

The offeror document setting out the detailed terms of the share offer made by Vickers Ballas Hong Kong Limited and Tai Fook Securities Company Limited, on behalf of Mr. Tsim Wing Kong, will be despatched to the shareholders of KEL Holdings Limited on 23 May 2000.

It is expected that the response document to be issued by the board of directors of KEL Holdings Limited will issue a response document setting out the advice from the independent board committee of KEL Holdings Limited with regard to the share offer will be despatched to the shareholders of KEL Holdings Limited on or before 5 June 2000, unless otherwise extended.

Request has been made by Mr. Tsim relating to the appointment of new directors to the board of KEL Holdings Limited upon the despatch of the offer document. A further announcement will be made by KEL Holdings Limited upon the appointment of new directors in due course.

Reference is made to the joint announcement of the Company and Mr. Tsim dated 2 May 2000 (the "Offer Announcement"). Terms used herein shall have the same meaning as those defined in the Offer Announcement unless the context otherwise defines.

DESPATCH OF DOCUMENTS

The document (the "Offer Document") containing details of the Offers together with the forms of acceptance and transfer has been despatched to the Shareholders on 23 May 2000. A document (the "Offeree Document") containing, among other things, a letter from the Board, a letter from the Independent Board Committee relating to its advice to the Independent Shareholders on the Share Offer together with the advice from the independent financial adviser and other financial information on the Group is expected to be despatched to the Shareholders on or before 5 June 2000.

Set out below is the timetable for the Share Offer:

2000

Commencement of the Share Offer 9:00 a.m. on 23 May

Latest date for posting of the Offeree Document (Note 1) 5 June

Closing of the Share Offer (Note 2) 9:30 a.m. on 20 June

Latest date for the despatch of remittances due in respect of

valid acceptances received under the Share Offer (Note 3) 29 June

Notes:

(1) The Executive's consent is required if the Offeree Document is posted after 5 June 2000, i.e. 14 days from the date of the Offer Document. Mr. Tsim agrees to extend the closing date of the Share Offer period by the number of business days in respect of which the posting of the Offeree Document is delayed. An announcement in this regard will be made by the Company.

(2) The Share Offer will remain open for acceptance until 4:00 p.m. on 19 June 2000. While Mr. Tsim has no intention of revising or extending the Share Offer beyond this date, he reserves the right to do so. Acceptances tendered after 4 p.m. on 19 June 2000 will only be valid if the Share Offer is revised or extended before 9:30 a.m. on 20 June 2000.

(3) Remittances in respect of the Share(s) tendered by a Shareholder under the Share Offer will be despatched to the relevant Shareholder by ordinary post within 10 days following the date of receipt of a valid form of acceptance and transfer.

Shareholders are advised to wait for the receipt of the Offeree Document and consider the information disclosed therein, in particular, the advice from the Independent Board Committee and the independent financial adviser with regard to the Share Offer prior to deciding on whether or not to accept the Share Offer.

APPOINTMENT OF NEW DIRECTORS

A request has been made by Mr. Tsim to the Board to appoint Mr. Tsim, Mr. Harris Tsim, Mr. Lo Tat Kwong, Danny, Mr. Tam Cham Kai and Cong Yiu Chik as Directors upon the despatch of the Offer Document. A further announcement will be made by the Company upon the appointment of these new Directors.

Restructuring Proposal

Reference is also made to the joint announcement dated 5 May 2000 made by the Company and Deson International Development Holdings Limited in relation to the Restructuring Proposal. Shareholders should note that a document relating to the Restructuring Proposal will be despatched to the Shareholders as soon as practicable.

By Order of the Board

KEL Holdings Limited

Leung Yat Tung

Chairman

Mr. Tsim Wing Kong

Hong Kong, 23 May 2000

Mr. Tsim accepts full responsibility for the accuracy of the information contained in this announcement (other than information relating to the Group) and confirms, after having made all reasonable inquiries, that to the best of his knowledge, the opinions expressed in this announcement (other than those expressed by the Group) have been arrived at after due and careful consideration and there are no other material facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.

The Directors jointly and severally accept responsibility for the accuracy of the information contained in this announcement (other than information relating to Mr. Tsim and his intention on the Group) and confirm, having made all reasonable inquiries, that to the best of their knowledge, the opinions expressed in this announcement (other than those expressed by Mr. Tsim) have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, 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 Standard"