Founder Holdings Limited — M&A Activity 2000

Aug 29, 2000

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.

MULTI-ASIA INTERNATIONAL HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

TERMINATION OF DISCLOSEABLE AND SHARE TRANSACTION

SUMMARY

The Board announces that as the Conditions in relation to the acquisition of a 60% shareholding interest in Pacific Cyber and the entire benefit in the Vendor's Loan by the Purchaser (being Hunter Profits Limited, a wholly-owned subsidiary of the Company) were not fulfilled in full pursuant to the Agreement, the Agreement has been terminated and of no effect.

Reference is made to the announcement dated 6th April, 2000 (the "Announcement") and the circular dated 20th April, 2000 (the "Circular") made by the Company in relation to the acquisition of a 60% shareholding interest in Pacific Cyber and the entire benefit in the Vendor's Loan (the "Acquisition"). Terms defined in the Announcement shall be used in this announcement unless otherwise specified.

The Acquisition

As set out in the Announcement, the consideration for the Acquisition amounted to HK$36,008,000 in aggregate, which amount should be satisfied as to HK$10,800,000 in cash, and as to the remaining HK$25,208,000 by the allotment and issue to the Vendor of the Consideration Shares (being 10,960,000 new Shares) at an issue price of HK$2.30 per Consideration Share upon Completion. A cash deposit of HK$2,000,000 (the "Deposit") has been paid by the Purchaser upon signing of the Agreement.

It was also stated in the Announcement that the Agreement was subject to the Conditions being fulfilled prior to a date within four and half months from the date of the Agreement (being 6th April, 2000) or such other date as all parties thereto should agree, otherwise the Agreement should be terminated and of no effect. Accordingly, all Conditions should be fulfilled on or before 21st August, 2000.

Termination of the Agreement

The Board announces that certain Conditions were not fulfilled by 21st August, 2000, namely (i) there has been no evidence to show that all intellectual property rights of the technical and functional features specification of the product of Pacific Cyber had been transferred from the relevant parties to Powerhouse Profits Limited, a wholly-owned subsidiary of Pacific Cyber; (ii) product of Pacific Cyber has not matched the set standard and in turn its production has not met the time schedule as set out in the Agreement; and (iii) the Listing Committee of the Stock Exchange has not granted listing of and permission to deal in all the Consideration Shares. No agreement was reached between the parties to the Agreement to extend the final fulfillment date of the Conditions. As such, the Agreement has been terminated and of no effect and the Company will withdraw its application previously made to the Stock Exchange for the listing of and permission to deal in all the Consideration Shares.

Return of Deposit and repayment of a loan

The Board further announces that as results of termination of the Agreement, (a) an amount of HK$2,500,000, being part of the loan in the amount of HK$3,000,000 (the "Loan") advanced by the Group to Pacific Cyber pursuant to the Agreement, has been repaid to the Company, and the balance of the Loan together with the interest accrued thereon (at a rate of 3% above the best lending rate as quoted by The Hongkong and Shanghai Banking Corporation Limited from time to time) shall be repaid by Pacific Cyber to the Group; and (b) the Deposit shall be returned to the Company without interest (the Deposit has not been returned to the Company as at the date of this announcement). Pursuant to the Agreement, the Deposit and the balance of the Loan together with the related interest shall be repaid to the Company upon demand being made by the Company, and relevant notices of demand for repayment have been issued by the Company on 28th August, 2000. As stated in the Circular which contained (among other things) details of the Agreement, the return of the Deposit and the repayment of the Loan together with the interest thereon have been secured by the personal guarantees of the beneficial owners of the Vendor that the Vendor should return the Deposit and it should procure Pacific Cyber and/or its wholly-owned subsidiaries (as the case may be) forthwith repay the Loan together with interest thereon when the Agreement is terminated. At present, the Board does not foresee any recoverability problem in relation to the Deposit and the Loan together with the interest accrued thereon, and the Board will make appropriate announcement if significant problem to recover the amounts is identified by it.

General

The Company is an investment holding company and its subsidiaries are principally engaged in the property investment, property information websites development, photograph developing and food processing and manufacturing business. It is the Group's strategy and direction to invest in suitable prudent technology related businesses. The Board hereby confirms that there will be no impact on the Group as well as its future business plan to invest in such suitable prudent technology related businesses as results of the termination of the Agreement.

	For and on behalf of the Board of
	MULTI-ASIA INTERNATIONAL HOLDINGS LIMITED
	Chang Kin Man
	Executive Director & Company Secretary

Hong Kong, 28th August, 2000

Please also refer to the published version of this announcement in the (Hong Kong iMail)