CWT International Limited — M&A Activity 2000

Feb 15, 2000

Listed Company Information

WAH TAK FUNG<0297> - Announcement 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. WAH TAK FUNG HOLDINGS LIMITED (Incorporated in Bermuda with limited liability) ANNOUNCEMENT The Board of Directors ("the Board") of Wah Tak Fung Holdings Limited ("the Company") refers to an article appearing in the newspapers on 14 February 2000 in relation to a possible investment by the Company ("Proposed Acquisition") in a business involved in the operation of internet security system in the People's Republic of China ("PRC") and discussions with a fibre optics company in the PRC to conduct broad band broadcasting ("Proposed Project"). The Board announces that the Company is in preliminary discussions with certain parties who are independent of and not connected with the directors, chief executive or substantial shareholders of the Company or any of its subsidiaries or their respective associates (as defined under the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited ("Listing Rules")) in relation to the Proposed Acquisition and the Proposed Project. Shareholders and other persons who are contemplating dealing in the securities of the Company are advised to exercise extreme caution. This announcement is made at the request of The Stock Exchange of Hong Kong Limited. The directors of the Company ("Directors") have noted the recent increase in the price of the shares of the Company and wish to state that, except as mentioned below, the Directors are not aware of any reason for such increases. The Board refers to an article appearing in the newspapers on 14 February 2000 in relation to a possible investment by the Company in a business involved in the operation of internet security system in the PRC and discussions with a fibre optics company in the PRC to conduct broad band broadcasting. The Board announces that the Company is in preliminary discussions with certain parties who are independent of and not connected with the directors, chief executive or substantial shareholders of the Company or any of its subsidiaries or their respective associates (as defined under the Listing Rules) for a possible investment by the Company in a business involved in the operation of internet security system in the PRC and for a possible conduct by the Company of businesses involving broad band broadcasting in the PRC. Preliminary discussions have taken place which may or may not result in the Proposed Acquisition being completed or the Proposed Project being conducted. At this stage, no letter of intent has been signed or agreement reached in respect of the Proposed Acquisition or the Proposed Project which may or may not proceed. It is uncertain when these discussions will be concluded or whether any binding legal documentation will be executed for the implementation of the Proposed Acquisition or the Proposed Project. As these discussions are still at a preliminary stage, no specific terms such as pricing or cost of investment for the Proposed Acquisition or the Proposed Project have been determined and, at this stage, the Directors have not made any funding arrangement for the Proposed Acquisition or the Proposed Project. If the Proposed Acquisition or the Proposed Project were to proceed, the Directors will consider suitable funding arrangement for the Company which may involve the use of its internal resources or other fund raising activities such as a new issue of shares. It is as yet unclear whether any approval is required from the relevant authorities in the PRC for the Proposed Acquisition or the Proposed Project. The Directors will seek appropriate PRC legal advice where necessary on the legality and practicability of these proposed transactions as well as compliance with applicable PRC laws and regulations if and when negotiations have reached a more advanced stage. As the Company has not decided on the level of its investment for these proposed transactions, it is not certain whether either of these proposed transactions will constitute a notifiable transaction under the Listing Rules. The Board also refers to an announcement of the Company dated 2 February 2000 in relation to a placing of 50,000,000 new shares of HK$0.10 each in the Company ("the Placing") and confirms that, at this stage, the net proceeds from the Placing would be used as general working capital for the Company. As the Company's discussions in respect of the Proposed Acquisition and the Proposed Project are still at a preliminary stage and no specific terms have been agreed, the Board has not decided to use any part of the proceeds from the Placing to fund the Proposed Acquisition or the Proposed Project. Save as disclosed, the Board confirms that there are no negotiations or agreements relating to intended acquisitions or realisations which are discloseable under paragraph 3 of the Listing Agreement, neither is the Board aware of any matter discloseable under the general obligation imposed by paragraph 2 of the Listing Agreement, which is or may be of a price sensitive nature. In the meantime, shareholders and other persons who are contemplating dealing in the securities of the Company are advised to exercise extreme caution. The Company will make further announcements to inform shareholders of developments in respect of the Proposed Acquisition and the Proposed Project. Made by the order of the Board, the Directors of which individually and jointly accept responsibility for the accuracy of this announcement. By order of the Board Chan King Hung Director Hong Kong SAR, 14 February 2000