Hong Kong Exchanges and Clearing Limited — Proxy Solicitation & Information Statement 2007

Sep 12, 2007

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your licensed securities dealer, registered institution in securities, bank, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Asia Orient Holdings Limited, you should hand this circular to the purchaser or transferee or the bank, licensed securities dealer, registered institution in securities or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this circular, 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 contents of this circular.

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ASIA ORIENT HOLDINGS LIMITED

( )[*]

(Incorporated in Bermuda with limited liability)

(Stock code: 214)

DISCLOSEABLE TRANSACTION

DISPOSAL OF A 9.6% EFFECTIVE INTEREST IN A COMMERCIAL PROPERTY DEVELOPMENT IN BEIJING

Financial adviser

* For identification purpose only

13 September 2007

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Sale and Purchase Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Information on Asia Orient . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Financial effects of the disposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Reasons for the transaction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Additional information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Appendix — General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7

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DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions have the following meanings:

“Asia Orient” or “Company” Asia Orient Holdings Limited (stock code: 214), an exempted company incorporated in Bermuda with limited liability, the issued shares of which are listed on the Main Board of the Stock Exchange “Asia Orient (BVI)” Asia Orient Holdings (BVI) Limited, a company incorporated in the British Virgin Islands and a wholly-owned subsidiary of the Company “associate(s)” has the meaning ascribed to it by the Listing Rules “associated corporations” has the meaning ascribed to it under Part XV of the SFO “Board” the board of the Directors “Director(s)” director(s) of the Company “Equity Joint Venture Company” (Beijing Yabao Real Estate Development Company Limited*) an equity joint venture company established under the laws of the PRC “Group” the Company together with its subsidiaries “HK$” Hong Kong dollars “Hong Kong” The Hong Kong Special Administrative Region of the PRC “Honour Ahead” Honour Ahead Limited, a company incorporated in the British Virgin Islands which holds a 20% interest in the Equity Joint Venture Company “Latest Practicable Date” 12 September, 2007, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information for inclusion in this circular “Listing Rules” The Rules Governing the Listing of Securities on the Stock Exchange “Maxworthy Investments” Maxworthy Investments Limited, a company incorporated under the laws of the Republic of Seychelles “Model Code” the Model Code for Securities Transactions by Directors of Listed Issuers, as set out in Appendix 10 to the Listing Rules “PRC” The People’s Republic of China, excluding for the purposes of this circular, Hong Kong and Macau

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	DEFINITIONS
“Property”	a site measuring approximately 8,400 square meters located at
	Zone C of Nanying Fang Wei Gai Area, Chaoyang District,
	Beijing, PRC
“Rights Issue”	the issue by way of rights of 192,858,782 rights Shares for
	every two existing Shares as announced by the Company on
	13 June 2007. On 30 July 2007, 192,858,782 new Shares were
	issued fully-paid at HK$1.3 per Share
“Sale and Purchase Agreement”	the sale and purchase agreement dated 27 August 2007
	entered into between the Maxworthy Investments and Asia
	Orient (BVI)
“SFO”	the Securities and Futures Ordinance (Chapter 571 of the
	Laws of Hong Kong)
“Share(s)”	ordinary shares of HK$0.10 each in the capital of the
	Company
“Shareholder(s)”	the shareholders of the Company
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Upper Level Investments”	Upper Level Investments Limited, a company incorporated in
	the Seychelles which holds a 48% shareholding interest in
	Honour Ahead
“%”	per cent.

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LETTER FROM THE BOARD

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ASIA ORIENT HOLDINGS LIMITED

( )[*]

(Incorporated in Bermuda with limited liability)

Executive Directors: Mr. Fung Siu To, Clement (Chairman) Dr. Lim Yin Cheng (Deputy chairman) Mr. Poon Jing (Managing Director and chief executive) Mr. Lun Pui Kan Mr. Kwan Po Lam, Phileas

Non-executive Director: Mr. Chan Sze Hung

Independent non-executive Directors: Mr. Cheung Kwok Wah, Ken Mr. Hung Yat Ming Mr. Wong Chi Keung

Registered office: Canon’s Court 22 Victoria Street Hamilton HM12 Bermuda

Head office and principal office in Hong Kong: 30th Floor Asia Orient Tower Town Place 33 Lockhart Road Wanchai Hong Kong

13 September 2007

To the Shareholders

Dear Sirs,

DISCLOSEABLE TRANSACTION DISPOSAL OF A 9.6% EFFECTIVE INTEREST IN A COMMERCIAL PROPERTY DEVELOPMENT IN BEIJING

INTRODUCTION

The Directors announced on 28 August 2007 that through the disposal of the entire issued share capital and outstanding shareholder’s loan of Upper Level Investments by Asia Orient (BVI), the Company has disposed of its indirect effective interest of 9.6% in the Equity Joint Venture Company the business of which is the development of the Property.

* For identification purpose only

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LETTER FROM THE BOARD

SALE AND PURCHASE AGREEMENT

Date

27 August 2007

Parties

Vendor: Asia Orient (BVI), a wholly-owned subsidiary of the Company

Purchaser: Maxworthy Investments, an investment holding company. To the best knowledge, information and belief of the Directors having made all reasonable enquires, the purchaser and its beneficial owner are third parties independent of the Group and connected persons of the Group.

Principal terms of the agreement

The entire share capital and outstanding shareholder’s loan of Upper Level Investments will be sold for an aggregate consideration of HK$110 million, in cash. As at 31 July 2007, the amount of outstanding shareholder’s loan of Upper Level Investments was approximately HK$6,065,000.

Upper Level Investments is an investment holding company. Its sole asset is its holding of 48% interests in the issued share capital of Honour Ahead, which is accounted for as an investment stated at cost in the book of Upper Level Investments. Honour Ahead is also an investment holding company whose sole asset is its holding of 20% of the registered capital of the Equity Joint Venture Company, which is also accounted for as an investment stated at cost in the book of Honour Ahead. The sole asset of the Equity Joint Venture Company is the beneficial ownership of the Property. Hence, Upper Level Investments is effectively interested in 9.6% of the Property.

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LETTER FROM THE BOARD

The chart below illustrates the current shareholding structure in Upper Level Investments:

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----- Start of picture text -----

Asia Orient (BVI)
100%
Upper Level Investments
48%
Honour Ahead
20%
Equity Joint Venture Company
100% beneficial interest
Property
----- End of picture text -----

The Property is located in Zone C of Nanying Fang Wei Gai Area in the Chaoyang District of Beijing, PRC with a site area of approximately 8,400 square metres. The commercial building to be constructed on the Property comprises a 12 storey block over a three level basement covering a total gross floor area of approximately 63,000 square metres. It is expected that construction will be completed around the first quarter of 2008.

Completion

Completion will take place on or before 26 February 2008 or such other date as the parties may agree.

Consideration

The aggregate consideration of HK$110 million was determined after arm’s length negotiation, taking into consideration the cost of the Group’s interest in the Property and the possible return which may be received by the Group upon completion of the development and sale of the units therein.

The payment of the consideration of HK$110 million shall be paid in the following manner:

• a deposit of HK$10 million has been paid upon signing of the Sale and Purchase Agreement;

• a further amount of HK$40 million shall be paid on or before 26 December 2007; and

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LETTER FROM THE BOARD

• the balance of HK$60 million shall be paid on completion, being the date on or before 26 February 2008.

INFORMATION ON ASIA ORIENT

Asia Orient is an investment holding company. The principal activities of its major investee companies include investment and development of properties and investment and operation of hotels, restaurants, travel agency and securities investment.

FINANCIAL EFFECTS OF THE DISPOSAL

The disposal will raise approximately HK$110 million in cash, before expenses and tax, for the Company on completion. The Group will consider applying the proceeds to other investment opportunities to enhance Shareholders’ value. However, there is no specific identified investment target as at the Latest Practicable Date.

According to the Group’s books and records at 31 March 2007, the Group’s investment in Upper Level Investments was stated at cost with the carrying value of approximately HK$101 million. The disposal will result in an estimated gain of approximately HK$9 million in the profit and loss accounts of the Group.

REASONS FOR THE TRANSACTION

The disposal provides an opportunity for the Group to immediately realise its entire investment in the Property. The alternative to Sale and Purchase Agreement would be to sell units in the finished commercial building after completion in the first quarter of 2008. Sale of the commercial units in the Property may expose the Group’s investment in the Property to future market risk and execution risks, such as unsold inventories. The Sale and Purchase Agreement enables the Group to receive its capital and investment return soonest, for the funding of other investment opportunities. The Directors believe that the terms of the Sale and Purchase Agreement are fair and reasonable and in the interests of the Shareholders as a whole.

ADDITIONAL INFORMATION

Your attention is drawn to the additional information set out in the appendix to this circular.

Yours faithfully, For and on behalf of the Board Asia Orient Holdings Limited Fung Siu To, Clement Chairman

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GENERAL INFORMATION

APPENDIX

1. RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular concerning the Company and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief, there are no other facts not contained in this circular the omission of which would make any statement herein misleading.

2. DISCLOSURE OF DIRECTORS’ INTEREST

As at the Latest Practicable Date, the interests and short positions of the Directors and chief executives of the Company in the shares, underlying shares and debentures of the Company or any of its associated corporation(s) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO), or pursuant to Section 352 of the SFO, to be entered into the register referred to therein, or pursuant to the Model Code were as follows:

(i) Long positions in Shares

(a) The Company

Number of Shares held

					Percentage
	Personal	Corporate	Family		shareholding
Name of Director	interest	interest	interest	Total	(%)
Mr. Poon Jing
(“Mr. Poon”)	92,761,366	88,677,414	3,257,939	184,696,719	31.92
Fung Siu To, Clement
(“Mr. Fung”)	9,278,770	—	—	9,278,770	1.60

Note: The percentage of shareholding is calculated on the basis of 578,576,347 Shares in issue as at the Latest Practicable Date.

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GENERAL INFORMATION

APPENDIX

(b) Associated corporations

Number of shares held

					Percentage
Name of	Associated	Beneficial	Corporate		shareholding
Director	corporation	owner	interest	Total	(%)
Mr. Poon	Asia Standard	6,248,502	3,087,345,774	3,093,594,276	43.06
	International		(Note 1)
	Group Limited
	(“Asia Standard
	International”)
Mr. Poon	Asia Standard Hotel	383,434	8,711,059,638	8,711,443,072	69.64
	Group Limited		(Note 1)
	(“Asia Standard
	Hotel”)
Mr. Poon and	Centop Investment	—	20	20	20
Mr. Fung	Limited		(Note 2)
	(“Centop”)
Mr. Poon	Centop	—	80	80	80
			(Note 3)
Mr. Fung	Mark Honour	9	—	9	9
	Limited

Notes:

• 1 By virtue of his controlling interest in the Company, Mr. Poon is deemed to be interested in the shares of Asia Standard International and Asia Standard Hotel held by the Company’s subsidiaries.

• Centop is owned as to 80% by Asia Standard International and 20% by Kingscore Investment Limited (“Kingscore”). Each of Mr. Poon and Mr. Fung holds 50% interest in Kingscore. By virtue of their interest in Kingscore, each of Mr. Poon and Mr. Fung is deemed to have interest in the 20 shares held by Kingscore and duplicate the interest of the other.

• By virtue of his controlling interest in the Company, Mr. Poon is deemed to have interest in the 80 shares of Centop held by Asia Standard International.

By virtue of his controlling interest in the Company, Mr. Poon is deemed to be interested in the shares of all the Company’s subsidiaries and associated corporations.

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GENERAL INFORMATION

APPENDIX

(ii) Long position in underlying shares — Interest in share options

Details of the share options granted to the Directors under the share option schemes of the Company and its associated corporation as at the Latest Practicable Date are set out as follows:

(a) The Company

		Number of
		underlying
		Shares subject
		to the
		outstanding
Name of Director	Capacity	share options
Mr. Fung	Beneficial owner	2,126,301
Dr. Lim Yin Cheng	Beneficial owner	2,126,301
Mr. Lun Pui Kan	Beneficial owner	2,126,301
Mr. Kwan Po Lam, Phileas	Beneficial owner	2,126,301

The share options were granted on 29 March 2007 and exercisable from 29 March 2007 to 28 March 2017 at the exercise price of HK$1.4315 (as adjusted) per Share.

(b) Asia Standard International

		Number of
		underlying
		shares of Asia
		Standard
		International
		subject
		to the
		outstanding
Name of Director	Capacity	share options
Mr. Fung	Beneficial owner	20,621,761
Mr. Poon	Beneficial owner	5,155,440
Dr. Lim Yin Cheng	Beneficial owner	20,621,761
Mr. Lun Pui Kan	Beneficial owner	20,621,761
Mr. Kwan Po Lam, Phileas	Beneficial owner	20,621,761

The share options were granted on 30 March 2005 and exercisable from 30 March 2005 to 29 March 2015 at the exercise price of HK$0.315 (as adjusted) per share of Asia Standard International.

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APPENDIX

GENERAL INFORMATION

(c) Asia Standard Hotel

					Number of
					underlying
					shares of Asia
					Standard
					Hotel subject
			Exercise		to the
			Price		outstanding
Name of Director	Capacity	Date of Grant	(HK$)	Exercise Period	share options
Mr. Fung	Beneficial	29 March 2007	0.1296	29 March 2007 to	80,000,000
	owner			28 March 2017
Dr. Lim Yin Cheng	Beneficial	2 April 2007	0.130	2 April 2007 to	80,000,000
	owner			1 April 2017
Mr. Lun Pui Kan	Beneficial	2 April 2007	0.130	2 April 2007 to	80,000,000
	owner			1 April 2017
Mr. Kwan Po Lam,	Beneficial	2 April 2007	0.130	2 April 2007 to	80,000,000
Phileas	owner			1 April 2017

(iii) Long position in underlying shares — Interest in warrants

Details of interest in warrants of the Company and its associated corporations as at Latest Practicable Date held by the Directors are set out as follows:

• (a) The Company

	**Number of underlying Shares **	**Number of underlying Shares **	subject to the warrants	subject to the warrants
		Corporate	Family
Name of Director	Beneficial owner	interest	interest	Total
Mr. Poon	18,552,272	17,735,479	651,587	36,939,338
Mr. Fung	1,855,753	—	—	1,855,753

• (b) Associated corporations

		Number of underlying Shares	Number of underlying Shares	Number of underlying Shares
		subject to the warrants
	Associated	Beneficial	Corporate
Name of Director	corporation	owner	interest	Total
Mr. Poon	Asia Standard	1,249,700	617,469,146	618,718,846
	International
Mr. Poon	Asia Standard	76,686	1,742,211,914	1,742,288,600
	Hotel

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GENERAL INFORMATION

APPENDIX

Save as disclosed above, as at the Latest Practicable Date, none of the Directors or chief executive (including their spouse and children under 18 years of age) of the Company had any interests or short positions in the shares, underlying shares and debentures of the Company or any of its associated corporation(s) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO), or pursuant to Section 352 of the SFO, to be entered in the register referred to therein, or pursuant to the Model Code in the Listing Rules.

3. SUBSTANTIAL SHAREHOLDERS

As at the Latest Practicable Date, so far as was known to the Directors or chief executives of the Company, the following persons (other than a Director or chief executive of the Company), were deemed or taken to have an interest or short position in the shares or underlying shares of the Company which would fall to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, or were, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group.

(i) Long position in the Shares

	Number of
Name	Shares held	Percentage
		(%)
Teddington Holdings Limited (“Teddington”) (Note 1)	36,991,791	6.39
Heston Holdings Limited (“Heston”) (Note 1)	30,816,927	5.33
Dalton Investments LLC (Note 2)	54,387,584	14.10
Clearwater Insurance Company (Note 2)	23,792,405	6.17
Daswani Rajkumar Murlidhar	29,211,020	5.04

Note:

1. Mr. Poon, his family interest and the companies wholly owned by him namely Teddington, Heston and Full Speed Investment Ltd. together hold 184,696,719 shares. The interests of Teddington and Heston duplicate the interests of Mr. Poon disclosed under the heading “Disclosure of Directors’ Interest” above.

2. As at Latest Purchasable Date, these shares represent the shareholding before taking into accounts the entitled rights Shares pursuant to the Rights Issue. The percentage shareholding is calculated on the basis of the issued shares capital of the Company before the Rights Issue.

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GENERAL INFORMATION

APPENDIX

(ii) Long position in the underlying Shares — Interest in warrants

	**Number **	of underlying
	**Shares **	subject to the
Name		warrants
Teddington		7,398,357
Heston		6,163,384

(iii) Interest in other members of the Group

	Name of registered
Name of non-wholly	substantial shareholders
owned subsidiary	(other than members of	Number of	Percentage of
of the Company	the Group)	shares held	interest
United Resources	Great Oriental	One ordinary share of	16.66%
Associates Limited	Developments Limited	US$1
Blissful Enterprises	Join Win Resources Limited	Two ordinary shares of	33.33%
Limited		US$1 each

Save as disclosed above, as at the Latest Practicable Date, so far as was known to the Directors, no other person (other than a Director or chief executive of the Company) had, or was deemed or taken to have an interest or short position in the shares of the Company and underlying shares which would fall to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, or was, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other members of the Group.

4. SERVICE AGREEMENTS

As at the Latest Practicable Date, none of the Directors had a service contract with any member of the Group which is not determinable within one year without payment of compensation (other than statutory compensation).

5. COMPETING INTERESTS

As at the Latest Practicable Date, none of the Directors and their associates have interests in any business which competes or is likely to compete, either directly or indirectly, with the business of the Group.

6. LITIGATION

Neither the Company nor any of its subsidiaries was engaged in any litigation or arbitration or claims of material importance which is known to the Directors to be pending or threatened by or against either the Company or any of its subsidiaries as at the Latest Practicable Date.

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GENERAL INFORMATION

APPENDIX

7. GENERAL

• (a) The company secretary of the Company is Ms. Chiu Yuk Ching, an associate member of The Hong Kong Institute of Chartered Secretaries.

• (b) The qualified accountant of the Company is Mr. Lun Pui Kan, an associate member of Hong Kong Institute of Certified Public Accountants.

• (c) The principal share registrars and transfer office of the Company is Butterfield Fund Services (Bermuda) Limited of Rosebank Centre, 11 Bermudiana Road, Pembroke HM08, Bermuda and the branch share registrar and transfer office of the Company is Computershare Hong Kong Investor Services Limited at Shops 1806-1807, 18th Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong.

• (d) The head office and principal place of business of the Company is at 30th Floor, Asia Orient Tower, Town Place, 33 Lockhart Road, Wanchai, Hong Kong.

• (e) The English text of this circular prevails over the Chinese text.

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