Dida Inc. — Capital/Financing Update 2007

Jul 9, 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)

SALE OF CONTAINER CARRIERS

On 9 July 2007, the Company entered into the Sale and Purchase Agreements with Shanghai Puhai, pursuant to which the Company has agreed to sell the Container Carriers to Shanghai Puhai at a total consideration of RMB28,000,000 (approximately HK$28,865,979).

The consideration has been determined by reference to the assets valuation report on the Container Carriers dated 20 April 2007 issued by an independent and qualified PRC valuer, China Tong Cheng Assets Appraisal Co., Ltd.. As set out in the report, as at 28 February 2007, each of the Container Carriers has been valued at RMB8,354,363, RMB8,354,363 and RMB9,233,770 respectively, with an aggregate of RMB25,942,496. As at 28 February 2007, the carrying values of the Container Carriers were RMB1,342,849.82, RMB1,543,920.8 and RMB2,563,094.89 respectively, with a total of RMB5,449,865.51.

The Container Carriers were built for the Company by Shanghai Zhonghua Shipyard, an independent third party in China and have been duly put into service since 1985, 1985 and 1986 respectively.

Under the Listing Rules, CSC is the controlling shareholder of the Company by virtue of holding approximately 47.46% of the issued share capital of the Company. Shanghai Puhai is a 99% subsidiary of CSCL, and CSC holds approximately 59.87% of the issued share capital of CSCL. Therefore, Shanghai Puhai is a connected person (as defined in the Listing Rules) of the Company. Accordingly, the Transaction constitutes a connected transaction of the Company under the Listing Rules. As each of the applicable percentage ratios relating to the Transaction is less than 0.1%, the Transaction is not be subject to the reporting and announcement requirements as set out in Rules 14A.45 to 14A.47 of the Listing Rules and is not subject to approval by the Independent Shareholders.

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This announcement is made in compliance with the simultaneous dissemination of information requirement under Rule 13.09(2) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited. The Company’s A shares are listed on the Shanghai Stock Exchange, and it has been requested by the Shanghai Stock Exchange to make an announcement similar to this announcement.

1. The Sale and Purchase Agreements entered into on 9 July 2007

1.1 The Parties

Seller: The Company

Buyer: Shanghai Puhai

1.2 The Container Carriers

The Container Carriers were built for the Company by Shanghai Zhonghua Shipyard, an independent third party in China, and have been put into service since 1985, 1985 and 1986 respectively, with tonnages of 6,770 DWT, 6,512 DWT and 6,770 DWT respectively.

1.3 Sale of the Container Carriers

Pursuant to the Sale and Purchase Agreements, the Company has agreed to sell the Container Carriers as second-hand vessels, while Shanghai Puhai has agreed to purchase the Container Carriers.

1.4 Consideration

RMB28,000,000 (approximately HK$28,865,979), which has been determined by reference to the appraised values of the Container Carriers as at 28 February 2007 by an independent and qualified PRC valuer, China Tong Cheng Assets Appraisal Co., Ltd. As set out in the report, as at 28 February 2007, each of the Container Carriers has been valued at RMB8,354,363, RMB8,354,363 and RMB9,233,770 respectively, with an aggregate of RMB25,942,496. The valuation was made on the basis of, among others, the relevant PRC regulations, industry information, information relating to the Container Carriers (including design specifications, list of facilities and equipment, technical specifications, explanations by the Container Carriers’ operators as to the technical status and usage conditions of the Container Carriers, inspection reports, repair and facility upgrade records, onsite inspection records, and operational history) and market value of second hand vessels.

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The Directors are of the opinion that the relevant consideration has been determined after arms length negotiation, and is fair and reasonable so far as the Company and its shareholders are concerned.

1.5 Payment terms

The consideration shall be payable in cash by two installments: the first installment RMB2,800,000 (approximately HK$2,886,598) (being 10% of the total consideration) shall be payable within three business days after the date of the signing of the Sale and Purchase Agreements, while the second installment RMB25,200,000 (approximately HK$25,979,381) (being 90% of the total consideration) shall be payable on or before 31 July 2007.

1.6 Financial Information relating to the Container Carriers

As at 28 February 2007, the Container Carriers had carrying values of RMB1,342,849.82, RMB1,543,920.8 and RMB2,563,094.89 respectively, with a total of RMB5,449,865.51. The net profit from the sale of the Container Carriers (i.e. the difference between the consideration of the sale and the carrying amount of the Container Carriers) is expected to be RMB22,550,134.49. It is intended that the net proceeds from the sale of the Container Carriers will be used as working capital.

For the two financial years ended 31 December 2006, the attributable net loss before tax and extraordinary items of the Container Carriers was RMB1,290,828, while the attributable loss after tax and extraordinary items of the Container Carriers was RMB1,429,428.

The financial information in relation to the Container Carriers above were prepared based on the PRC generally accepted accounting principles.

1.7 Delivery

The Container Carriers will be delivered to Shanghai Puhai in Dalian, Tianjin and Shanghai respectively on or before 31 July 2007.

1.8 Other Terms

The costs and risks in respect of the Container Carriers incurred before the delivery of the Container Carriers will be borne by the Company. The costs and risks in respect of the Container Carriers immediately following the delivery will be borne by Shanghai Puhai.

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The Sale and Purchase Agreements is subject to general force majeure provisions. In the event that the Company fails to perform the Sale and Purchase Agreements due to force majeure events such as earthquake, fire, tsunami and war and Shanghai Puhai chooses to terminate the Sale and Purchase Agreements, the Company shall refund the deposit and the interests based on the annual interest rate of 10% to Shanghai Puhai within 7 banking days.

In the event that Shanghai Puhai fails to pay the deposit of RMB2,800,000, or fails to pay the balance of RMB25,200,000 in accordance with the Sale and Purchase Agreements, the Company shall have the right to terminate the Sale and Purchase Agreements and make claims in respect of any subsequent losses and interests based on the annual interest rate of 10%.

If there is any dispute between the Company and Shanghai Puhai which cannot be settled after reasonable negotiations, this shall be referred to China Maritime Arbitration Commission (a committee established pursuant to the resolution of the State Council of the PRC) for arbitration in Shanghai, China.

2. Reasons and Benefits for Entering Into the Sale and Purchase Agreements

The Container Carriers has been bareboat chartered to CSCL from 1998 to 2010 for a term of 12 years. The Container Carriers can no longer meet the development requirement of the CSCL, due to the low tonnage, slow speed and outdated technical situation. As a result, the Company and CSCL have decided to terminate the bareboat charterparty through arms length negotiations.

The Company mainly operates oil and coal transportation and is not in the container transportation business. Accordingly, the Company decided to sell the Container Carriers as second-hand vessels so as to generate more working capital for the Company. The Board currently does not have any plans as regards the specific use of the working capital. The Directors do not expect there will be any adverse impact to the Group as a result of the Transaction.

3. General

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

Shanghai Puhai mainly carries out the sub-route services (i.e. international trade domestic feeder services, domestic trade domestic feeder services and international sub-route services) for CSCL.

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4. Requirements of the Listing Rules

Under the Listing Rules, CSC has become the controlling shareholder of the Company by virtue of holding approximately 47.46% of the issued share capital of the Company. Shanghai Puhai is a 99% subsidiary of CSCL, and CSC holds approximately 59.87% of the issued share capital of CSCL. Therefore, Shanghai Puhai is a connected person (as defined in the Listing Rules) of the Company. Given the above reason, the Transaction constitutes a connected transaction of the Company for the purpose of the Listing Rules.

As each of the applicable percentage ratios in respect of the Transaction is less than 0.1%, the Transaction is not subject to the reporting and announcement requirements as set out in Rules 14A.45 to 14A.47 of the Listing Rules and is not subject to Independent Shareholders’ approval. The Group does not have any prior transaction in connection with sale and purchase of vessels with CSCL or Shanghai Puhai in the past 12 months.

Disclosure on the Transaction will be made in the annual report of the Company for 2007 in accordance with the relevant requirements of the Listing Rules.

The terms and conditions of the Transaction have been determined through arms length negotiations and the Transaction has been conducted in the ordinary and usual course of business of the Company. The Board (including Independent Directors) are of the opinion that the Transaction has been entered into under normal commercial terms, the terms of the Transaction are fair and reasonable, and are in the interests of the Company and its shareholders as a whole.

This announcement is made in compliance with the simultaneous dissemination of information requirement under Rule 13.09(2) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited. The Company’s A shares are listed on the Shanghai Stock Exchange, and it has been requested by the Shanghai Stock Exchange to make an announcement similar to this announcement.

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DEFINITIONS

In this announcement, the following expressions have the meanings set out below unless the context requires otherwise.

“Board” board of Directors; “Company” China Shipping Development Company Limited, a joint stock limited company incorporated in the People’s Republic of China with limited liability; “Container Carriers” three Container Carriers, namely “Xiangying”, “Xianglian” and “Xiangdan” to be sold under the Sale and Purchase Agreements; “CSCL” China Shipping Container Lines Co., Ltd., a joint stock limited company incorporated in the People’s Republic of China with limited liability and listed on the Stock Exchange; “DWT” dead weight tons; “CSC” China Shipping (Group) Company ( ); “Directors” directors of the Company; “Independent Directors” independent non-executive Directors; “Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange; “PRC” The People’s Republic of China; “RMB” Renminbi, the lawful currency of the PRC; “Sale and Purchase three sale and purchase agreements dated 9 July 2007 Agreements” entered into between the Company and Shanghai Puhai in relation to the sale and purchase of the Container Carriers;

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“Shanghai Puhai”

Shanghai Puhai Shipping Co., Ltd ( ), a subsidiary of CSCL; and

“Transaction” the transaction contemplated under the Sale and Purchase Agreements.

By order of the Board

China Shipping Development Company Limited Yao Qiaohong

Company Secretary

Shanghai, the PRC 9 July 2007

Note: Unless otherwise specified, the conversion of HK$ into RMB is based on the exchange rate of HK$1.00 = RMB0.97.

As at the date of this announcement, the Board of Directors of the Company is comprised 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.

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