Dida Inc. — Capital/Financing Update 2007

Dec 30, 2007

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.

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CHINA SHIPPING DEVELOPMENT COMPANY LIMITED

(a joint stock limited company incorporated in the People’s Republic of China with limited liability)

(Stock Code: 1138)

CONNECTED AND MAJOR TRANSACTION CONSTRUCTION OF NEW VESSELS

On 29 December 2007, the Company entered into the Agreements with the Vendors for the construction of 6 Vessels of 57,300 dead weight tons each and CS Development Hong Kong entered into the Agreements with the Vendors for the construction of 4 Vessels of 57,000 dead weight tons each for the transportation of coal and other bulk cargo. The total consideration for the construction of the Vessels is approximately RMB2,837,980,000 (equivalent to approximately HK$3,030,962,640).

Since China Shipping is the controlling shareholder of the Company and that each of the Vendors are wholly owned subsidiaries of China Shipping, the transactions contemplated under the Agreements are connected transactions for the Company under the Listing Rules and are subject to the approval of the Independent Shareholders at the EGM. The entering into of the Agreements will also constitute a major transaction for the purpose of the Listing Rules by way of aggregation with the agreements for the construction of 2 oil tankers each of 46,000 dead weight tons by the Vendors as published in the Company’s announcement dated 16 February 2007, with the agreements for the construction of 12 dry bulk carriers each of 57,300 dead weight tons by the Vendors as published in the Company’s announcement dated 29 March 2007 and with the agreements for the construction of 2 tankers each of 46,500 dead weight tones by the Vendors as published in the Company’s announcement dated 12 April 2007. Save for the aforesaid the Company considers there were no other prior transactions between the Group and the Vendors which may require aggregation under Rule 14A.25 of the Listing Rules. A circular, as well as a notice convening the EGM, will be despatched to the holders of H shares of the Company in due course.

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The Agreement

On 29 December 2007, the Company entered into the Agreements with the Vendors for the construction of 6 Vessels of 57,300 dead weight tones each and CS Development Hong Kong entered into the Agreements with the Vendors for the construction of 4 Vessels of 57,000 dead weight tons each for the transportation of coal and other bulk cargo. The total consideration for the construction of the Vessels is approximately RMB2,837,980,000 (equivalent to approximately HK$3,030,962,640). The consideration is determined by reference to the market price for the past 6 months of dry bulk carriers of tonnage between 40,000 dead weight tons and 60,000 dead weight tons with similar specifications.

To the best of the Directors’ knowledge, information and belief having made all reasonable enquiries, each of the Vendors is a wholly-owned subsidiary of China Shipping. Since China Shipping is the controlling shareholder of the Company, the transactions contemplated under the Agreements are connected transactions for the Company under the Listing Rules and are subject to the approval of the Independent Shareholders at the EGM. The entering into of the Agreements will also constitute a major transaction for the purpose of the Listing Rules by way of aggregation with the agreements for the construction of 2 oil tankers each of 46,000 dead weight tons by the Vendors as published in the Company’s announcement dated 16 February 2007, with the agreements for the construction of 12 dry bulk carriers each of 57,300 dead weight tons by the Vendors as published in the Company’s announcement dated 29 March 2007 and with the agreements for the construction of 2 tankers each of 46,500 dead weight tones by the Vendors as published in the Company’s announcement dated 12 April 2007. Save for the aforesaid the Company considers there were no other prior transactions within the past 12 months between the Group and the Vendors which may require aggregation under Rule 14A.25 of the Listing Rules.

The Directors consider that the terms of the Agreements are determined on an arm’s length basis, on normal commercial terms and fair and reasonable and in the interests of the Company and the Shareholders as a whole.

Terms of the Agreements

The price of the 6 vessels of 57,300 dead weight tons each will be payable in RMB. The price of the 4 vessels of 57,000 dead weight tons each will be payable in US$. Relevant payments under each of the Agreements will be payable in instalments at various stages of the construction of the relevant Vessel. Relevant payments under each of the Agreements will be payable in 5 instalments at various stages of the construction of the relevant vessel:

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• (i) for the first instalment, to pay 20% of the price within 10 business days after the Agreements become effective;

• (ii) for the second, third and fourth instalment, to pay 20% of the price within 5 business days of the receipt of the relevant invoice issued by the Vendors; and

• (iii) for the final instalment, to pay 20% of the price within 5 business days of the receipt of all documentation in relation to completion of the relevant Vessel by the Vendors.

The expected delivery dates for the Vessels ranges from 39 months to 54 months after the Vendor’s receipt of the first instalment payment under the relevant Agreement or up to 8 June 2012 at the latest.

Each of the Agreements provides that there will be no adjustment in the price of the relevant Vessel if the delivery is delayed for a period not exceeding 60 days. If the delay exceeds 60 days but does not exceed 210 days, there will be a reduction in the price of the relevant Vessel based on a daily reduction of RMB48,000 for the 57,300 dead weight ton Vessels and RMB30,000 for the 57,000 dead weight ton Vessels. If the delay exceeds 210 days, the Company or CS Development Hong Kong (as the case may be) has the right to cancel the relevant Agreement and the Vendors will within 10 business days return all previous payments by the Company or CS Development Hong Kong (as the case may be) together with interest.

There will be other downward adjustments in price of the relevant Vessel if its performance (such as speed, fuel consumption rate, tonnage) exceeds or falls below certain agreed criteria. There is no maximum adjustment in price. However should the relevant performance exceed or falls below certain agreed benchmark, the Company or CS Development Hong Kong (as the case may be) has the right to refuse delivery of the relevant vessel and accept a refund with interest from the Vendors, or negotiate a new price for the relevant vessel.

The Agreements are conditional upon the approval of the Independent Shareholders at the EGM.

Financing Terms

The construction of the Vessels will be funded by the Company or CS Development Hong Kong (as the case may be) as to approximately 80% of the price by bank borrowings and approximately 20% of the price by cash.

The financing by way of bank borrowings is expected to increase the Company’s level of borrowings. Taking into account the Company’s capital and shareholders’

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base, the Company considers that bank borrowing is the best means of financing for the construction of the Vessels. The Directors believe that in light of the Company’s fleet expansion plan, it is fair and reasonable and in the interest of the Company and the Shareholders as a whole to finance the transaction with such bank borrowings.

Information about the Group and China Shipping

The business scope of the Group includes: coastal, ocean and Yangtze River cargo transportation, container transportation, oil transportation, chartering, cargo agency and cargo transportation agency.

The business scope of China Shipping includes import and export business, trading, coastal and ocean cargo transportation, dry bulk cargo transportation, supply of food for vessels, management of docks and other services in relation to the above. Each of the Vendors is in the business of shipbuilding and ship repairing.

Reasons for entering into the Agreements

The Directors are optimistic of the demand in the coal and other bulk cargo transportation market and its persistent growth in the coming years. The Directors are of the view that the construction and ownership of the Vessels will enable the Group to take advantage of the business opportunities in the shipping market, enjoy economies of scale, optimize its overall route arrangements and improve its operating efficiency and profitability.

As of 30 September 2007, the Company has 115 dry bulk carriers, totalling approximately 4,020,000 dead weight tons. As such, upon completion of the construction of the 10 Vessels and the 12 bulk carriers being constructed by the Vendors (details of which were published in the Company’s announcement dated 29 March 2007, together with 16 bulk carriers being constructed by shipyards other than the Vendors, the Company is expected to have a total of 153 dry bulk carriers, totaling approximately 9,500,000 dead weight tons by 2012.

Since China Shipping is the controlling shareholder of the Company and that each of the Vendors are wholly owned subsidiaries of China Shipping, the transactions contemplated under the Agreements are connected transactions for the Company under the Listing Rules and are subject to the approval of the Independent Shareholders at the EGM. China Shipping, the controlling shareholder of the Company, and its associates will abstain from voting on the Agreements at the EGM.

The Independent Board Committee has been appointed to advise the Independent Shareholders as to whether the terms of the transaction contemplated under the Agreements are fair and reasonable and whether they are in the interests of the

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Company and its Shareholders as a whole. An independent financial advisor will be appointed to advise the Independent Board Committee and the Independent Shareholders as to whether or not the terms of the Agreements are on normal commercial terms, in the ordinary and usual course of business and fair and reasonable so far as the Independent Shareholders are concerned and are in the interest of the Company and the Shareholders as a whole.

A circular containing, among other things, details of the transactions under the Agreements, a letter from the Independent Board Committee with its recommendation to the Independent Shareholders, a letter from the independent financial advisor containing its advice to the Independent Board Committee and the Independent Shareholders, as well as a notice convening the EGM will be despatched to the holders of H shares of the Company in due course.

Definitions

In this announcement, unless the context otherwise requires, the following terms shall have the following meanings:

• “EGM”

extraordinary general meeting of the shareholders to be convened by the Company to consider and, if thought fit, to approve (amongst other things) the Agreements

“Agreements” 10 agreements all dated 29 December 2007, each of which is entered into between the Vendors and the CS Development Hong Kong or the Vendors and the Company (as the case may be) for the construction of one Vessel (for a total of 10 Vessels) for the transportation of coal and other bulk cargo

• “China Shipping” (China Shipping (Group) Company*), a PRC state-owned enterprise and the controlling shareholder of the Company, currently holding 47.46% of the registered capital of the Company

• “CS Development China Shipping Development (Hong Kong) Marine Co., Hong Kong” Limited ( ), a wholly-owned subsidiary of the Company

• “Company” China Shipping Development Company Limited ( ), a joint stock limited company established in the PRC, the H shares of which are listed on the Stock Exchange

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“Directors” directors of the Company

“Group” the Company and its subsidiaries

• “H Shares” H shares of par value RMB1.00 each in the share capital of the Company, being overseas listed foreign invested shares

• “HK$” Hong Kong dollars, the lawful currency of the Hong Kong Special Administrative Region of the PRC

• “Independent the Shareholders other than China Shipping and its Shareholder(s)” associates (as defined in the Listing Rules)

• “Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange

• “PRC” The People’s Republic of China

• “Shareholder(s)” holders of share(s) of the Company

• “Stock Exchange” The Stock Exchange of Hong Kong Limited

• “Vendors” (China Shipping Industrial Co., Ltd.) and (China Shipping Industrial (Jiangsu) Co., Ltd.)

“Vessels”

• Dry bulk carriers of 57,000 dead weight tons each or 57,300 dead weight tons each, as the case may be

By Order of the Board of Directors China Shipping Development Company Limited Yao Qiaohong Company Secretary

Shanghai, the People’s Republic of China

29 December 2007

The exchange rate adopted in this announcement for illustration purpose only is RMB1.00 = HK$1.068.

As at the date of this announcement, the Board of Directors of the Company comprises of Mr. Li Shaode, Mr. Ma Zehua, Mr. Lin Jianqing, Mr. Wang Daxiong, Mr. Zhang Guofa, Mr. Mao Shijia and Mr. Wang Kunhe as executive Directors, Mr. Ma Xun, Mr. Xie Rong, Mr. Hu Honggao and Mr. Zhou Zhanqun as independent non-executive Directors.

• For identification purpose only

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