Dida Inc. — Capital/Financing Update 2008

Jun 12, 2008

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 中海發展股份有限公司

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

(Stock Code: 1138)

DISCLOSEABLE TRANSACTION SIGNING OF JOINT VENTURE CONTRACT

Reference is made to the announcement made by the Company dated 21 February and 10 June 2008 in relation to the formation of a joint venture shipping company with Baosteel Resources. This announcement is made in compliance with Chapter 14 of the Listing Rules.

The Company and Baosteel Resources signed the Joint Venture Contract on 10 June 2008, the main provisions of which are set out in the announcement below.

Reference is made to the announcement made by the Company dated 21 February and 10 June 2008 in relation to the formation of a joint venture shipping company with Baosteel Resources.

This announcement is made in compliance with Chapter 14 of the Listing Rules.

Progress in the joint venture arrangement with Baosteel Resources

The Company and Baosteel Resources signed the Joint Venture Contract on 10 June 2008, the main provisions of which are set out below:-

1. The joint venture company is a private limited company incorporated in the Hong Kong Special Administrative Region. Its name is Hong Kong Hai Bao Shipping Co. Limited (香港海寶航運有限公司).

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1. The issued share capital of the joint venture company will be US$8,000,000 (equivalent to approximately HK$62,480,000), with 51% and 49% to be contributed by the Company and Baosteel Resources respectively. The joint venture parties will further provide shareholder’s loan in the total amount of approximately US$132,000,000 (equivalent to approximately HK$1,030,920,000) to the joint venture company on equivalent terms in proportion to their shareholdings in the joint venture company. The shareholders’ loan will be used for payments in respect of the construction contracts referred to below other than repayment of banking facilities. It is also intended that the joint venture company will raise bank borrowings in the amount of approximately US$563,660,000 (equivalent to approximately HK$4,402,584,600) to be guaranteed (where necessary) by the Company and Baosteel Resources pro rata to their shareholding interest in the joint venture company. Accordingly, the total investment amount in connection with the joint venture company is expected to be approximately US$703,660,000 (equivalent to approximately HK$5,495,584,600). The total amount of capital commitment to be made by the Company under the Joint Venture Contract is therefore approximately US$358,866,600 (equivalent to approximately HK$2,802,748,146).

2. The principal business scope of the joint venture company includes international marine large bulk cargo shipping, chartering, sale and purchase and management of vessels, crew management and other shipping related businesses.

3. Upon the incorporation of the joint venture company, the Company will transfer construction contracts in relation to two 300,000-tonne VLOCs and four 230,000-tonne VLOCs or the Registered Owner Shares to the joint venture company or a single-vessel company designated by it with the consideration to be settled in cash in US$.

4. (a) The consideration at which these VLOCs construction contracts are to be transferred is as follows:-

   • (i) the construction progress payments already made by the Company to the shipbuilding company;

   • (ii) the costs of fund paid by the Company from the payment date of the progress payments to the date of the transfer of the construction contracts; and

   • (iii) other fees and expenses paid by the Company in connection thereto.

5. (b) In the event that Registered Owner Shares are to be transferred, the consideration at which such shares are to be transferred is the consideration determined in sub-paragraph (a) above as reduced by the payables recorded on the books of the relevant single-vessel company.

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1. The Company will further transfer its rights and obligations under five contracts of affreightment contracts entered into with Baoshan Iron & Steel Co., Ltd. on 26 January 2007 and 21 February 2008 to the joint venture company or a single-vessel company designated by the joint venture company.

2. Under equivalent conditions, the joint venture company will give priority to entering into a vessel management agreement with the vessel management company recommended by the Company and hand over the management of engineering, marine, maintenance and crew affairs to the vessel management company.

3. Under equivalent conditions, the joint venture company will give priority to entering into a crew hire agreement with the crew management company recommended by the Company.

Once the internal audit and approval procedures of the joint venture parties are completed, the joint venture parties will report the project to the relevant government authorities. Upon completion of all approval procedures, the joint venture company will complete the relevant matters such as the establishment of the company according to law.

The issued share capital of US$4,080,000 (equivalent to approximately HK$31,864,800) and the proportionate shareholders’ loan of US$67,320,000 (equivalent to approximately HK$525,769,200) payable by the Company will be utilised to pay for the construction progress payments of the ship constructions referred to above.

There are no prior transaction between the Company and Baosteel Resources which requires aggregation under rule 14.22 of the Listing Rules.

Information about the Group and Baosteel Resources

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 international dry bulk cargo transportation market, the PRC coastal coal transportation market and their persistent growth in the coming years.

Baosteel Resources is a wholly owned subsidiary of Baosteel Group Corp and is principally engaged in the investment and development, trading and logistics operation of iron and steel related raw materials.

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Reason for the transaction

As announced in the Company’s announcement dated 21 February 2008, the Directors are of the view that the formation of the joint venture company will further strengthen the strategic cooperation with iron and steel enterprises and allow the Company to fully capitalize on the resources advantages of iron and steel enterprises and the shipping advantages of the Company to jointly compete in the imported iron ore transportation market and to obtain stable investment returns.

In particular, the formation of the joint venture company by the Company and Baosteel Resources will make use of their respective advantages to realize a strong union and guarantee that long-term steady cargo sources and investment returns can be obtained whilst the Company expands its fleet of vessels and is beneficial to the Company’s development in the long run.

Accordingly the Directors (including the independent non-executive Directors) are of the view that the terms of the Joint Venture Contract are fair and reasonable and in the interest of the shareholders of the Company as a whole.

General

A circular giving details of the joint venture company will be dispatched to the holders of share(s) of the Company in due course.

Definitions

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

“Baosteel Resources”

Baosteel Resources Co., Ltd. (寶鋼資源有限公司) (formerly known as Baosteel Trading Co., Ltd.), a company incorporated in Shanghai, PRC and a wholly-owned subsidiary of Baosteel Group Corp. To the best of the Directors’ knowledge, information and belief having made all reasonable enquiries, Baosteel Resources and its ultimate beneficial owners are third parties independent of the Company and its connected persons (as defined under the Listing Rules)

“Company” China Shipping Development Company Limited (中海發展股份有限公司), a joint stock limited company established in the PRC, the H shares of which are listed on The Stock Exchange of Hong Kong Limited

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“Directors” directors of the Company

• “Joint Venture Contract”

the joint venture contract and the supplemental agreement both dated 10 June 2008 in relation to the formation of the joint venture by the Company with Baosteel Resources

• “Listing Rules”

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

• “PRC”

The People’s Republic of China

• “Registered Owner the shares of the single-vessel company held by the Shares” Company as the registered owner of the relevant VLOCs

• “VLOC(s)” very large iron ore carrier(s)

By Order of the Board China Shipping Development Company Limited Li Shaode Chairman

Shanghai, the PRC 12 June 2008

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, Mr. Zhu Yongguang 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$7.81.

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