Hony Media Group — M&A Activity 1999

Oct 14, 1999

Listed Company Information

CHINA STRATEGIC<0235> & CHINA ONLINE<0383>-Announcement & Resumption The Stock Exchange of Hong Kong Limited (the `Stock Exchange') 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. CHINA STRATEGIC HOLDINGS LIMITED (`CSH') (Incorporated in Kong with limited liability) CHINA ONLINE (BERMUDA) LIMITED (`COL') (Incorporated in Bermuda with limited liability) On 12th October, 1999, CSH and COL have received and are considering a non-binding conditional proposal (the `Proposal') from an interested party for COL to carry out internet related businesses which, if it proceeds, may be treated as a very substantial acquistion for COL. The Proposal may or may not proceed. Summary of the Proposal:- 1. The interested party a major internet player in (`IP'): the Greater China region and a third party independent of each of CSH and COL. CSH and COL consider it to be premature to disclose the name of IP or the Web site referred to below. 2. The Proposal : COL is to acquire a basket of assets (the `Assets') from the IP at a consideration to be settled by new shares and convertible bonds of COL. The Assets include, inter alia, substantial ownership of a Web site which provides cultural, travel and business information, ownership of partnership which provides e-business solutions and other related assets. The value of the Assets will be determined by an independent valuer. 3. Conditions: These are the conditions contained in the Proposal. They may or may not be the only conditions, if the Proposal proceeds. (a) CSH to place out a significant portion of its existing holding upon completion of the Proposal. (b) The Stock Exchange not treating the Proposal as a very substantial acquisition and a new listing application. (Based on the information currently available to the Stock Exchange, it has indicated to CSH and COL that it will regard the Proposal as a new listing application.) (c) The Securities and Futures Commission granting a waiver for a general offer for all shares of COL. (d) The Stock Exchange granting a permission to deal for the new shares to be issued and to be converted from the convertible bonds of COL. (e) There is no change in the listing status of COL. (f) Approval by shareholders of COL, if appropriate under the Listing Rules. (g) All other consent necessary for the Proposal such as a consent from joint venture partners of the IP. 4. Possible Effect on Shareholding If CSH and COL decide to proceed with the Proposal (which they are still considering whether or not to accept), the holding of CSH in COL would be significantly diluted from the existing 47% and the IP will become a major shareholder of COL. CSH would agree to dispose of its remaining interest in COL over a period of time. 5. Further Announcement The boards of directors of CSH and COL will further consider whether or not to proceed with the Proposal and the main terms and conditions of the Proposal. Your attention is drawn to the fact that no agreement has yet been reached between CSH, COL and the IP. The Proposal may or may not proceed. CSH and COL will make further announcements when a decision has been made, which is expected to be within the next couple of weeks. 6. Resumption of Trading Trading in the shares of CSH and COL was suspended at their respective request from 10:00 a.m. on Wednesday, 13th October, 1999. Application has been made to the Stock Exchange for resumption of trading of the shares of CSH and COL from 10:00 a.m. on Thursday, 14th October, 1999. Investors are advised to exercise extreme caution when dealing in the shares of CSH and COL. By Order of the Board China Strategic Holdings Limited Ma Wai Man, Catherine Executive Director By Order of the Board China Online (Bermuda) Limited Ma Wai Man, Catherine Executive Director Hong Kong, 13th October, 1999 The directors of CSH, jointly and severally, accept full responsibility for the accuracy of information contained in this announcement other than information relating to COL and confirm, having made all reasonable enquiries, that to the best of their knowledge, there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading. The directors of COL, jointly and severally, accept full responsibility for the accuracy of information contained in this announcement other than information relating to CSH and confirm, having made all reasonable enquiries, that to the best of their knowledge, there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.