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)

MAJOR TRANSACTION CONSTRUCTION OF NEW VESSELS

Reference is made to the Company’s announcement dated 22 October 2007 concerning, among other things, the construction of new vessels which constituted a major transaction.

On 29 December 2007, CS Development Hong Kong entered into the Agreements with the Vendors for the construction of four VLOCs each of 300,000 dead weight tons for the transportation of iron ores. The total consideration for the construction of the VLOCs is approximately US$467,200,000 (equivalent to approximately HK$3,644,160,000.00).

The entering into of the Agreements (which, for the purpose of the Listing Rules, will be aggregated with the agreements for the construction of six tankers of 76,000 dead weight tons each for the transportation of crude oil and refined oil between the Company and the Vendors, details of which were contained in the Company’s announcement dated 2nd March 2007, and the construction of four VLOCs, details of which were contained in the Company’s announcement dated 22 October 2007) constitutes a major transaction of the Company under the Listing Rules. A circular giving details of the transaction under the Agreements, together with a notice convening the EGM, will be despatched to Shareholders in due course.

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The Agreement

Reference is made to the Company’s announcement dated 22 October 2007 concerning, among other things, the construction of new vessels which constituted a major transaction.

On 29 December 2007, CS Development Hong Kong entered into the Agreements with the Vendors for the construction of four VLOCs each of 300,000 dead weight tons for the transportation of iron ores. The total consideration for the construction of the VLOCs is approximately US$467,200,000 (equivalent to approximately HK$3,644,160,000.00). The consideration is determined by reference to the market price of iron ores carriers ranging in sizes from 230,000 to 300,000 dead weight tons during the past 3 months. The Agreements were entered into on 29 December 2007.

On 2nd March 2007, the Company entered into agreements with the Vendors for the construction of six tankers of 76,000 dead weight tons each for the transportation of crude oil and refined oil, details of which were contained in the Company’s major transaction announcement dated 2nd March 2007. On 22 October 2007, CS Development Hong Kong entered into agreements with the Vendors for the construction of four VLOCs of 300,000 dead weight tons each for the transportation of iron ores, details of which were contained in the Company’s major transaction announcement dated 22 October 2007. Save as aforesaid, in the 12 months prior to the date of this announcement there were no other transactions between the Company and the Vendors and its associates which require aggregation under Rule 14.22 of the Listing Rules.

To the best of the Directors’ knowledge, information and belief having made all reasonable enquiries, the Vendors and their ultimate beneficial owners are independent third parties not connected with the Company and its connected persons (as defined in the Listing Rules).

The Directors (including the Independent non-executive Directors) consider that the terms of the Agreement 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.

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Terms of the Agreements

The prices of the VLOCs will be payable in US$. Relevant payments under each of the Agreements will be payable in 5 instalments at various stages of the construction of the relevant vessel:

• (i) for the first instalment, to pay 20% of the price within 7 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 VLOC by the Vendors.

The expected delivery date for each of the VLOCs is on or before 29 February 2012, 30 April 2012, 31 May 2012 and 30 June 2012 respectively.

Each of the four Agreements provides that there will be no adjustment in the price of the relevant VLOC if the delivery is delayed for a period not exceeding 30 days. If the delay exceeds such period of time but does not exceed 60, 90 and 210 days respectively, there will be a reduction in the price of the relevant VLOC determined on the basis of the extent of the delay. The reduction in the price will be calculated based on a daily reduction rate ranging from US$15,000 per day to US$23,600 per day (depending on the extent of the delay). Under the four Agreements, delay will be permitted on account of force majeure events.

If the delay exceeds 210 days, unless the parties agree otherwise, CS Development Hong Kong has the right to accept delivery of the relevant VLOC with the daily accrued reduction in price or refuse to accept delivery of the relevant VLOC in which case all payments paid under the relevant Agreement together with interests will be refunded to CS Development Hong Kong.

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

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Financing Terms

The construction of the VLOCs will be funded by the Company as to approximately 80% of the price by bank borrowings and approximately 20% of the price by internal resources. 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’ base, the Company considers that bank borrowings is the best means of financing for the construction of the VLOCs. The Directors (including the independent non-executive 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

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 Directors are optimistic of the demand in the iron ores transportation market and its persistent growth in the coming years. In addition, the Company has entered into long-term contracts of affreightment for shipping of imported iron ores with China Shougang International Trade & Engineering Corp. and Bao Steel Company Limited respectively, details of which were contained in the Company’s announcements dated 27th October, 2006 and 26th January 2007 respectively. The Directors are of the view that the construction and ownership of the VLOCs 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.

Under the Listing Rules, the entering into of the Agreements (which, for the purpose of the Listing Rules, will be aggregated with the agreements for the construction of six tankers of 76,000 dead weight tons each for the transportation of crude oil and refined oil between the Company and the Vendors, details of which were contained in the Company’s announcements date 2nd March 2007, as well as the agreements for the construction of four VLOCs each of 300,000 dead weight tones for the transportation of iron ores, details of which were contained in the Company’s announcement dated 22 October 2007) constitutes a major transaction of the Company. A circular giving details of the transaction under the Agreements, together with a notice convening the EGM, will be despatched to Shareholders in due course. China Shipping (Group) Company, the controlling Shareholder of the Company, does not have and, as far as the Directors are aware having made all reasonable enquiries, no other Shareholder has, a material interest in the transaction. As such, no Shareholder will be required under the Listing Rules to abstain from voting on the Agreements at the EGM.

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Definitions

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

• “Agreements”

  • four agreements all dated 29 December 2007, each of which is entered into between the Vendors and CS Development Hong Kong for the construction of one VLOC (for a total of four VLOCs) for the transportation of iron ores

• “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 of Hong Kong Limited

• “CS Development Hong Kong”

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

• “CSOC”

  • China Shipbuilding & Offshore International Company Limited* ( ), a Chinese company engaging in the trading, import, export and agency of ships and shipping related technology and services

• “Dalian Shipbuilding” Dalian Shipbuilding Industry Company Limited* ( ), a Chinese Shipbuilder

• “Directors” directors of the Company

• “EGM”

  • extraordinary general meeting of the shareholders to be convened by the Company to consider and, if thought fit, to approve the Agreements

• “Group” the Company and its subsidiaries

• “HK$”

  • Hong Kong dollars, the lawful currency of the Hong Kong Special Administrative Region of the PRC

• “Listing Rules”

  • the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited

• “PRC” The People’s Republic of China

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

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“US$”

United States dollars, the lawful currency of the United States of America

“Vendors”

CSOC and Dalian Shipbuilding

“VLOC(s)”

Very Large Iron Ores Carrier(s)

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

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, and Mr. Ma Xun, Mr. Xie Rong, Mr. Hu Honggao and Mr. Zhou Zhanqun as independent non-executive Directors.

The exchange rate adopted in this announcement for illustration purpose only is US$1.00 = HK$7.80

• For identification purpose only

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