Mao Geping Cosmetics Co., Ltd. — Proxy Solicitation & Information Statement 2007

Apr 25, 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 you should take, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in SCMP Group Limited, you should at once hand this circular and the accompanying form of proxy to the purchaser or transferee or to the bank, stockbroker 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 of the contents of this circular.

SCMP Group Limited SCMP (Incorporated in Bermuda with limited liability)

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(Stock Code: 583)

Proposal for Grant of General Mandates to Issue and Repurchase Shares and

Notice of Annual General Meeting

A notice convening the annual general meeting of SCMP Group Limited to be held at Island Ballroom A, Level 5, Island Shangri-La Hotel, Pacific Place, Supreme Court Road, Hong Kong on Monday, 28 May 2007 at 11:00 a.m. is set out on pages 7 to 11 of this circular. Whether or not you are able to attend the meeting, you are requested to complete the form of proxy enclosed with this circular in accordance with the instructions printed thereon and return it to the Company at Morning Post Centre, 22 Dai Fat Street, Tai Po Industrial Estate, New Territories, Hong Kong as soon as possible and in any event not less than 48 hours before the time appointed for holding the meeting. Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting should you so wish.

24 April 2007

* For identification purpose only

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Chairman. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
2. General Mandate to Issue Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
3. General Mandate to Repurchase Shares . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
4. Re-election of Retiring Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
5. Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
6. Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
7. Additional Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Appendix 1 – Notice of Annual General Meeting . . . . . . . . . . . . . . . . . . .	7
Appendix 2 – Explanatory Statement on the Share Repurchase
Mandate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
Appendix 3 – Details of Directors Proposed to be Re-elected . . . . . . . . .	15
Appendix 4 – Right to Demand a Poll . . . . . . . . . . . . . . . . . . . . . . . . . . .	18

– i –

DEFINITIONS

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

“Annual General Meeting”	the annual general meeting of the Company to be held at
	11:00 a.m. on Monday, 28 May 2007 at Island Ballroom A,
	Level 5, Island Shangri-La Hotel, Pacific Place, Supreme
	Court Road, Hong Kong
“AGM Notice”	the notice convening the Annual General Meeting as set
	out on pages 7 to 11 of this circular
“Board”	the Board of Directors
“Bye-Laws”	the Bye-Laws adopted by the Company on 4 November
	1996 as amended, supplemented or modified from time to
	time
“Company”	SCMP Group Limited, an exempted company
	incorporated in Bermuda with limited liability, the Shares
	of which are listed on the Stock Exchange
“Directors”	the directors of the Company
“Latest Practicable Date”	19 April 2007, being the latest practicable date prior to
	the printing of this circular for ascertaining certain
	information contained in this circular
“Listing Rules”	the Rules Governing the Listing of Securities on the
	Stock Exchange for the time being in force
“Securities and Futures	the Securities and Futures Ordinance (Chapter 571 of the
Ordinance”	Laws of Hong Kong)
“Share(s)”	the ordinary share(s) of HK$0.10 each in the share capital
	of the Company
“Shareholder(s)”	holder(s) of Share(s) in issue
“Stock Exchange”	The Stock Exchange of Hong Kong Limited

– 1 –

DEFINITIONS

“subsidiary” means a company which is for the time being and from time to time a subsidiary (within the meaning of the Companies Ordinance of Hong Kong (Chapter 32 of the Laws of Hong Kong) or the Companies Act 1981 of Bermuda (as amended) or the local companies law, act and/or ordinance where the subject company was incorporated) “Takeovers Code” Hong Kong Code on Takeovers and Mergers

– 2 –

LETTER FROM THE CHAIRMAN

SCMP Group Limited

SCMP

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(Incorporated in Bermuda with limited liability)

(Stock Code: 583)

Directors:

Executive Directors Kuok Khoon Ean (Chairman) Kuok Hui Kwong

Non-executive Directors Roberto V. Ongpin (Deputy Chairman) Tan Sri Dr. Khoo Kay Peng Robert Ng Chee Siong

Independent Non-executive Directors The Hon. Ronald J. Arculli Peter Lee Ting Chang Dr. The Hon. Sir David Li Kwok Po Wong Kai Man

Registered Office:

Canon’s Court 22 Victoria Street Hamilton, HM12 Bermuda

Principal Place of Business:

Morning Post Centre 22 Dai Fat Street Tai Po Industrial Estate New Territories Hong Kong

24 April 2007

To Shareholders

Dear Sir or Madam,

Proposal for Grant of General Mandates to Issue and Repurchase Shares and Notice of Annual General Meeting

1. Introduction

The purpose of this letter is to provide information to Shareholders regarding the proposal to grant the Directors general mandates to issue and repurchase Shares at the Annual General Meeting. Set out in Appendix 1 to this letter is the AGM Notice convening the Annual General Meeting at which Shareholders will be requested to consider and, if they think fit, adopt resolutions relating to the grant of general mandates to issue and repurchase Shares and certain other resolutions as ordinary businesses of the Annual General Meeting.

* For identification purpose only

– 3 –

LETTER FROM THE CHAIRMAN

2. General Mandate to Issue Shares

At the last annual general meeting of the Company held on 25 May 2006, the Directors were granted a general mandate to allot, issue and deal with additional Shares up to a maximum of 20 per cent. of the share capital of the Company in issue as at the date of the passing of the relevant resolution. Such general mandate will cease to be effective at the conclusion of the Annual General Meeting.

As part of the special businesses of the Annual General Meeting, Shareholders are asked to consider and if thought fit, to pass an ordinary resolution as set out in resolution 6 in the AGM Notice to renew the mandate to give the Directors power to allot, issue and deal with additional Shares with an aggregate nominal amount not exceeding 20 per cent. of the share capital of the Company in issue as at the date of the passing of the resolution. Such general mandate, if approved by the Shareholders, will be effective during the period from the date of the passing of the resolution until the conclusion of the next annual general meeting of the Company or the expiration of the period within which the next annual general meeting of the Company is required by the Bye-Laws of the Company or any applicable law to be held or the revocation or variation of the resolution by an ordinary resolution of the Shareholders in general meeting, whichever is the earliest. Subject to Shareholders granting the Directors the general mandate to repurchase Shares as described below, Shareholders are also asked to extend the general mandate to issue Shares by an amount representing the aggregate nominal amount of the Shares repurchased by the Company under the general mandate to repurchase Shares such that the amount of Shares so repurchased does not exceed 10 per cent. of the aggregate nominal amount of the share capital of the Company in issue as at the date of the passing of the resolution.

3. General Mandate to Repurchase Shares

At the last annual general meeting of the Company held on 25 May 2006, the Directors were granted a general mandate to repurchase Shares up to an aggregate nominal amount not exceeding 10 per cent. of the aggregate nominal amount of Shares in issue as at the date of the passing of the relevant resolution. Such general mandate will cease to be effective at the conclusion of the Annual General Meeting.

As part of the special businesses of the Annual General Meeting, Shareholders are asked to consider and if thought fit, to pass an ordinary resolution as set out in resolution 7 in the AGM Notice to renew the mandate to give the Directors power to repurchase Shares up to an aggregate nominal amount not exceeding 10 per cent. of the aggregate nominal amount of Shares in issue as at the date of the passing of the resolution. Based on the 1,560,945,596 Shares in issue as at the Latest Practicable Date and assuming no Shares are issued or repurchased before the Annual General Meeting, the Company would therefore be allowed under this mandate to repurchase a maximum of 156,094,559 Shares.

In accordance with the Listing Rules, Appendix 2 to this letter serves as an explanatory statement to provide Shareholders with all the information reasonably necessary to enable you to make an informed decision on whether to vote for or against the resolution to be proposed at the Annual General Meeting to renew the mandate to allow the Directors to repurchase Shares.

– 4 –

LETTER FROM THE CHAIRMAN

4. Re-election of Retiring Directors

In accordance with Bye-Law 99 of the Company’s Bye-Laws, every Director shall retire from office no later than the third annual general meeting after he was last elected or re-elected. If the number of Directors so retiring is less than one-third (or the number nearest one-third if the total number of Directors is not three or a multiple of three) of the Directors for the time being, then additional Directors who have been longest in office since their last election or re-election shall retire from office by rotation to make up the shortfall so that one-third (or the number nearest one-third if the total number of Directors is not three or a multiple of three) of the Directors will retire at each annual general meeting.

Mr. Peter Lee Ting Chang was last re-elected in 2004. He will retire from office and is eligible for re-election at the Annual General Meeting. Mr. Lee offers himself for re-election.

Mr. Peter Lee Ting Chang is an Independent Non-executive Director of the Company. The Company has received an annual confirmation of independence from Mr. Lee in accordance with Rule 3.13 of the Listing Rules. The Directors are of the opinion that Mr. Lee has been and continues to be independent. In reaching their opinion of Mr. Lee’s independence, the Directors were satisfied that there are no relationships or circumstances which are likely to affect Mr. Lee’s judgement and any relationships or circumstances which could appear to do so were considered not material. The Directors recommend Shareholders to vote for the re-election of Mr. Lee as an Independent Non-executive Director of the Company.

Tan Sri Dr. Khoo Kay Peng and Mr. Robert Ng Chee Siong, both were re-elected in 2005, will retire from office in accordance with the Company’s Bye-Law 99 and are eligible for re-election at the Annual General Meeting. Tan Sri Dr. Khoo offers himself for re-election. Mr. Robert Ng Chee Siong has informed the Board that he will not stand for re-election.

In addition, Mr. Wong Kai Man was appointed as an Independent Non-executive Director of the Company on 2 April 2007. In accordance with Bye-Laws 102(B) of the Company’s Bye-Laws, Mr. Wong shall hold office until the conclusion of the Annual General Meeting and shall be eligible for re-election at the Annual General Meeting. Mr. Wong offers himself for re-election.

Shareholders are requested to consider and vote on the re-election of Mr. Peter Lee Ting Chang, Mr. Wong Kai Man and Tan Sri Dr. Khoo Kay Peng, separately and individually, under resolution 3 of the AGM Notice. The biographies and details of interests in the Shares of the Directors to be re-elected at the Annual General Meeting are set out in Appendix 3 to this letter.

– 5 –

LETTER FROM THE CHAIRMAN

5. Annual General Meeting

Set out in Appendix 1 to this letter is the AGM Notice to convene the Annual General Meeting to be held at Island Ballroom A, Level 5, Island Shangri-La Hotel, Pacific Place, Supreme Court Road, Hong Kong on Monday, 28 May 2007 at 11:00 a.m. to consider certain resolutions as ordinary businesses of the Annual General Meeting. In addition to this, Shareholders are requested to consider resolutions 6 to 8 in the AGM Notice relating to grant of the general mandates to the Directors to issue and repurchase Shares which are proposed as ordinary resolutions.

Whether or not you are able to attend the Annual General Meeting, you are requested to complete the enclosed form of proxy and return the same to the Company at Morning Post Centre, 22 Dai Fat Street, Tai Po Industrial Estate, New Territories, Hong Kong in accordance with the instructions printed thereon. The form of proxy is to be received by the Company not later than 11:00 a.m. on Saturday, 26 May 2007. Completion and return of the form of proxy will not preclude you from attending and voting in person at the Annual General Meeting should you so wish.

Shareholders’ rights to demand a poll on the proposed resolutions at the Annual General Meeting are set out in Appendix 4 to this letter.

6. Recommendation

The Directors are of the opinion that all the proposed resolutions are in the best interest of the Company and the Shareholders as a whole and recommend Shareholders to vote in favour of all the resolutions to be proposed at the Annual General Meeting.

7. Additional Information

Enclosed with this circular is a copy of the 2006 Annual Report of the Company. Shareholders are advised to have regard to the information contained in this Annual Report in arriving at their decision as to voting at the Annual General Meeting.

Yours faithfully, Kuok Khoon Ean Chairman

– 6 –

NOTICE OF ANNUAL GENERAL MEETING

APPENDIX 1

SCMP Group Limited

SCMP

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(Incorporated in Bermuda with limited liability)

(Stock Code: 583)

Notice is hereby given that the Annual General Meeting of SCMP Group Limited will be held at Island Ballroom A, Level 5, Island Shangri-La Hotel, Pacific Place, Supreme Court Road, Hong Kong on Monday, 28 May 2007 at 11:00 a.m. for the following purposes:

1. To receive and consider the Audited Financial Statements and the Directors’ Report and Auditors’ Report for the year ended 31 December 2006.

2. To approve the payment of a final dividend.

3. To re-elect the following retiring Directors:

4. (a) Mr. Peter Lee Ting Chang as Independent Non-executive Director

5. (b) Mr. Wong Kai Man as Independent Non-executive Director

6. (c) Tan Sri Dr. Khoo Kay Peng as Non-executive Director

7. To authorise the Board to fix Directors’ fee.

8. To re-appoint PricewaterhouseCoopers as Auditors and authorise the Board to fix their remuneration.

9. As special business, to consider and if thought fit, pass the following resolution as an ordinary resolution:

“ THAT :

• (a) subject to paragraph (c) below, the exercise by the Directors during the Relevant Period (as hereinafter defined) of all the powers of the Company to allot, issue and deal with additional Shares or securities convertible into such Shares or options or warrants or similar rights to subscribe for any Shares and to make or grant offers, agreements and options which would or might require Shares to be allotted and issued be and is hereby generally and unconditionally approved;

* For identification purpose only

– 7 –

NOTICE OF ANNUAL GENERAL MEETING

APPENDIX 1

• (b) the approval in paragraph (a) above shall authorise the Directors to make or grant offers, agreements and options during the Relevant Period which would or might require Shares to be allotted and issued during and/or after the end of the Relevant Period;

• (c) the aggregate nominal amount of Shares allotted or agreed conditionally or unconditionally to be allotted by the Directors pursuant to the approval in paragraphs (a) and (b) above, otherwise than pursuant to or in consequence of:

• (i) a Rights Issue (as hereinafter defined); or

• (ii) the exercise of the conversion rights under the terms of any securities which are convertible into Shares; or

• (iii) any option scheme or similar arrangement for the time being adopted for the grant or issue to officers and/or employees of the Company and/or any of its subsidiaries of Shares or rights to acquire Shares; or

• (iv) the exercise of rights of subscription under the terms of any warrants issued by the Company; or

• (v) any scrip dividend or similar arrangement providing for the allotment of Shares in lieu of the whole or part of a dividend on Shares in accordance with the Bye-Laws of the Company;

shall not exceed 20 per cent. of the aggregate nominal amount of the share capital of the Company in issue at the date of the passing of this resolution; and

• (d) for the purpose of this resolution:

“Relevant Period” means the period from the passing of this resolution until the earliest of:

• (i) the conclusion of the next annual general meeting of the Company following the passing of this resolution; and

• (ii) the expiration of the period within which the next annual general meeting of the Company is required by the Bye-Laws of the Company or any applicable law to be held; and

• (iii) the date on which the authority set out in this resolution is revoked or varied by an ordinary resolution of the members of the Company in general meeting.

– 8 –

NOTICE OF ANNUAL GENERAL MEETING

APPENDIX 1

• “Rights Issue” means an offer of Shares, or an offer of warrants, options or other securities giving rights to subscribe for Shares, open for a period fixed by the Directors to holders of Shares on the Register of Members of the Company on a fixed record date and, where appropriate, the holders of other equity securities of the Company entitled to be offered therein, in proportion to their then holdings of such Shares or other equity securities (subject to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements or having regard to any restrictions or obligations under the laws of, or the requirements of any recognised regulatory body or any stock exchange in, any territory outside Hong Kong).”

• As special business, to consider and if thought fit, pass the following resolution as an ordinary resolution:

“ THAT :

• (a) subject to paragraph (b) below, the exercise by the Directors during the Relevant Period (as hereinafter defined) of all powers of the Company to repurchase its Shares, subject to and in accordance with all applicable laws and/or requirements of the Listing Rules be and is hereby generally and unconditionally approved;

• (b) the aggregate nominal amount of Shares which may be repurchased by the Company pursuant to the approval in paragraph (a) above during the Relevant Period should not exceed 10 per cent. of the aggregate nominal amount of Shares in issue at the date of the passing of this resolution and the said approval shall be limited accordingly; and

• (c) for the purpose of this resolution, “Relevant Period” means the period from the passing of this resolution until the earliest of:

• (i) the conclusion of the next annual general meeting of the Company following the passing of this resolution; and

• (ii) the expiration of the period within which the next annual general meeting of the Company is required by the Bye-Laws of the Company or any applicable law to be held; and

• (iii) the date on which the authority set out in this resolution is revoked or varied by an ordinary resolution of the members of the Company in general meeting.”

– 9 –

NOTICE OF ANNUAL GENERAL MEETING

APPENDIX 1

1. As special business, to consider and if thought fit, pass, with or without amendments, the following resolution as an ordinary resolution:

“ THAT , subject to the passing of the resolutions 6 and 7 above, the general mandate granted to the Directors to exercise the powers of the Company to allot, issue and deal with additional Shares pursuant to resolution 6 above be and is hereby extended by the addition thereto of an amount representing the aggregate nominal amount of Shares repurchased by the Company under the authority granted pursuant to resolution 7 above, provided that such amount of Shares so repurchased shall not exceed 10 per cent. of the aggregate nominal amount of the share capital of the Company in issue at the date of the passing of this resolution.”

By Order of the Board Vera Leung Company Secretary

Hong Kong, 24 April 2007

As at the date hereof, the Board comprises:

Executive Directors

Mr. Kuok Khoon Ean (Chairman) and Ms. Kuok Hui Kwong

Non-executive Directors

Mr. Roberto V. Ongpin (Deputy Chairman), Tan Sri Dr. Khoo Kay Peng and Mr. Robert Ng Chee Siong

Independent Non-executive Directors

The Hon. Ronald J. Arculli, Mr. Peter Lee Ting Chang, Dr. The Hon. Sir David Li Kwok Po and Mr. Wong Kai Man

Notes:

• (1) A member entitled to attend and vote at the above meeting is entitled to appoint a proxy or proxies to attend and vote in his or her stead and any such member who is a holder of two or more shares in the Company is entitled to appoint more than one proxy to attend and vote in his or her stead. A proxy need not be a member of the Company. In the event that a member appoints more than one proxy, on a show of hands, all such proxies shall collectively have one vote unless otherwise provided for in the Bye-Laws of the Company.

• (2) The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorised in writing, or if the appointor is a corporation, either under seal or under the hand of an officer or attorney duly authorised.

• (3) Where there are joint registered holders of any share, any one of such persons may vote at the above meeting, either personally or by proxy, in respect of such share as if he were solely entitled thereto; but if more than one of such joint holders be present at the meeting personally or by proxy, that one of the said persons so present whose name stands first on the register of members of the Company in respect of such share shall alone be entitled to vote in respect thereof. Several executors or administrators of a deceased member in whose name any share stands will for this purpose be deemed joint holders thereof.

– 10 –

NOTICE OF ANNUAL GENERAL MEETING

APPENDIX 1

• (4) To be valid, the form of proxy together with the power of attorney or other authority (if any) under which it is signed or a notarially certified copy thereof must be lodged at Morning Post Centre, 22 Dai Fat Street, Tai Po Industrial Estate, New Territories, Hong Kong as soon as possible and, in any event, not less than 48 hours before the time appointed for the holding of the above meeting. Completion and deposit of the form of proxy will not preclude a member from attending and voting in person at the above meeting if the member so wishes.

• (5) The register of members of the Company will be closed from Monday, 21 May 2007 to Friday, 25 May 2007, both dates inclusive, during which period no transfer of shares will be effected. All transfers accompanied by the relevant share certificates must be lodged with the Company’s Hong Kong Branch Share Registrars, Computershare Hong Kong Investor Services Limited of Room no. 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong, not later than 4:30 p.m. on Friday, 18 May 2007 so as to qualify for the proposed final dividend and attending the above meeting.

• (6) Members of the Company are advised to read the circular to shareholders dated 24 April 2007 which contains information concerning the resolutions to be proposed in this notice.

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EXPLANATORY STATEMENT ON THE SHARE REPURCHASE MANDATE

APPENDIX 2

This explanatory statement relates to resolution 7 proposed to be passed at the Annual General Meeting, which is an ordinary resolution to grant the Directors a general mandate to repurchase Shares through the Stock Exchange. It contains all the information required pursuant to Rule 10.06(1)(b) of the Listing Rules to be given to the Shareholders to enable them to make an informed decision on whether to vote for or against such ordinary resolution.

1. Share Repurchase Proposal

Under the Listing Rules, all the Shares proposed to be repurchased by the Company shall be fully paid up. All proposed repurchase of shares by a company with a primary listing on the Stock Exchange must be approved in advance by an ordinary resolution, either by way of general mandate or by specific approval of a specific transaction.

As at the Latest Practicable Date, the share capital of the Company in issue comprised 1,560,945,596 Shares. Assuming no Shares are issued or repurchased before the Annual General Meeting and the ordinary resolution authorising the Directors to repurchase Shares is passed at the Annual General Meeting, up to 156,094,559 Shares representing 10 per cent. of the share capital of the Company in issue as at the date of the passing of the resolution may be repurchased by the Company during the period from the date of the passing of the resolution until the conclusion of the next annual general meeting of the Company or the expiration of the period within which the next annual general meeting of the Company is required by the Bye-Laws of the Company or any applicable law to be held or the revocation or variation of the resolution by an ordinary resolution of the Shareholders in general meeting, whichever is the earliest.

2. Reasons for Repurchase

The Directors believe that it is in the best interests of the Company and the Shareholders to have a general authority from Shareholders to enable the Directors to repurchase Shares in the market. Such repurchase may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the net asset value of the Company and its assets and/or its earnings per Share and will only be made when the Directors believe that such repurchase will benefit the Company and the Shareholders.

3. Funding of Repurchase

Under the Listing Rules, repurchases of Shares by the Company must be funded out of funds legally available for the purpose. The Company may only apply funds legally available for such purpose in accordance with its Memorandum of Association and Bye-Laws and the applicable laws of Hong Kong and Bermuda.

It is presently proposed that any repurchase of Shares would be paid out of capital paid up on the repurchased Shares, the profits of the Company which would otherwise be available for dividend, the Company’s share premium account and/or its contributed surplus account.

– 12 –

EXPLANATORY STATEMENT ON THE SHARE REPURCHASE MANDATE

APPENDIX 2

In addition, on the basis of the consolidated financial position of the Company as at 31 December 2006 (being the date to which the latest published audited financial statements of the Company have been made up), the Directors consider that the exercise in full of the share repurchase mandate might have a material adverse impact on the working capital position of the Company as compared with its position as at 31 December 2006. No repurchase would be made in circumstances that might have a material adverse impact on the working capital or gearing position of the Company (as compared with the position disclosed in the latest published audited financial statements) unless the Directors considered that such repurchases were in the best interests of the Company notwithstanding such material adverse impact.

4. General

None of the Directors nor, to the best of their knowledge having made all reasonable enquiries, any of their associates (as defined in the Listing Rules) has any present intention, in the event that the resolution to grant the Directors a general mandate to repurchase Shares is approved by Shareholders, to sell any Shares to the Company.

The Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, they will exercise the power of the Company to make repurchases pursuant to the share repurchase mandate in accordance with the Listing Rules and the applicable laws of Bermuda.

If, as a result of the exercise of the power to repurchase Shares pursuant to the share repurchase mandate, a Shareholder’s proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition and may give rise to an obligation to make a mandatory offer in accordance with Rule 26 of the Takeovers Code.

As at the Latest Practicable Date, the Company was informed that Kerry Group Limited (through its subsidiaries and controlled corporations) held an aggregate of 606,372,000 Shares, representing approximately 38.85 per cent. of the total share capital of the Company in issue. Subject to the granting of a waiver from the Executive Director of the Corporate Finance Division of the Securities and Futures Commission, any increase in shareholdings in the Company which is outside the 2% creeper as specified in Rule 26.1 of the Takeovers Code will give rise to an obligation to make a mandatory offer for the Company under Rule 26 of the Takeovers Code. In the event of the Directors exercising in full the power to repurchase Shares under the mandate, the aggregate shareholdings of Kerry Group Limited and/or its concert parties (hereinafter collectively referred to as “Kerry Group”) may be increased by more than 2%. If so, this may give rise to an obligation on the Kerry Group to make a mandatory offer under Rule 26 of the Takeovers Code.

Save as aforesaid, the Directors are not aware of any consequence that would arise under the Takeovers Code and the Hong Kong Code on Share Repurchases in the event of the exercise of the power to repurchase Shares pursuant to the share repurchase mandate.

No connected person (as defined in the Listing Rules) has notified the Company that he has a present intention to sell Shares to the Company, or has undertaken not to do so in the event that the Company is authorised to make repurchases of the Shares.

– 13 –

EXPLANATORY STATEMENT ON THE SHARE REPURCHASE MANDATE

APPENDIX 2

5. Share Repurchases Made by the Company

The Company has made no repurchase of its Shares (whether on the Stock Exchange or otherwise) in the past six months prior to the Latest Practicable Date.

6. Share Price

The highest and lowest prices at which the Shares have traded on the Stock Exchange in each of the 12 months prior to the printing of this explanatory statement were as follows:

		Highest	Lowest
Year	Month	Traded Price	Traded Price
		(HK$)	(HK$)
2006	April	3.100	2.750
	May	3.125	2.525
	June	2.675	2.350
	July	2.950	2.575
	August	2.900	2.680
	September	2.920	2.740
	October	2.990	2.450
	November	2.840	2.670
	December	2.960	2.760
2007	January	3.000	2.750
	February	3.040	2.800
	March	3.020	2.700

– 14 –

APPENDIX 3 DETAILS OF DIRECTORS PROPOSED TO BE RE-ELECTED

Biographies of and interests in Shares held by Directors proposed to be re-elected at the Annual General Meeting:

1. Mr. Peter Lee Ting Chang

Mr. Peter Lee Ting Chang, JP, aged 53, an Independent Non-executive Director, joined the Board in August 1998. Mr. Lee is Chairman of Hysan Development Company Limited (whose shares are listed on the Hong Kong Stock Exchange) and a non-executive director of Cathay Pacific Airways Limited (whose shares are listed on the Hong Kong Stock Exchange), CLP Holdings Limited (whose shares are listed on the Hong Kong Stock Exchange), Hang Seng Bank Limited (whose shares are listed on the Hong Kong Stock Exchange) and Maersk China Limited as well as director of a number of other companies. He is a Vice President of the Real Estate Developers Association of Hong Kong. Mr. Lee is a graduate in Civil Engineering from the University of Manchester and also qualified as a Solicitor of the Supreme Court of England and Wales.

As at the Latest Practicable Date, Mr. Lee did not have any interest in any Shares within the meaning of the Securities and Futures Ordinance. The Company has given a letter of appointment to Mr. Lee pursuant to which Mr. Lee is appointed for a term commencing on 24 May 2004 (the date of his latest re-election as Director of the Company) and ending at the conclusion of the Annual General Meeting. In 2006, Mr. Lee was entitled to a Director’s fee of HK$100,000 per annum and Director’s emolument of HK$200,000 per annum for serving on the Audit Committee (HK$100,000), Remuneration Committee (HK$50,000) and Nomination Committee (HK$50,000) which were fixed by the Board of Directors pursuant to the authority granted by the Shareholders at the Company’s annual general meeting. Under Bye-Law 99 of the Company, Mr. Lee will be subject to retirement by rotation and eligible for re-election at the Company’s annual general meeting every three years.

Other than the aforesaid, Mr. Lee does not have any relationship with any Directors, senior management, substantial shareholders or controlling shareholders of the Company, there is no other information to be disclosed under rule 13.51(2) of the Listing Rules and there is no other matter that need to be brought to the attention of Shareholders.

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APPENDIX 3 DETAILS OF DIRECTORS PROPOSED TO BE RE-ELECTED

2. Mr. Wong Kai Man

Mr. Wong Kai Man, JP, aged 56, an Independent Non-executive Director, joined the Board in April 2007. Mr. Wong is an accountant with 32 years of audit, initial public offer and computer audit experience. He was a member of the Growth Enterprise Market Listing Committee of The Stock Exchange of Hong Kong Limited from 1999 to 2003. He retired as an audit partner from PricewaterhouseCoopers, Hong Kong on 30 June 2005 and is currently the chief executive officer of Li & Fung (1906) Foundation Limited, a charity and a senior advisor to Tricor Services Limited, a provider of business services. He is currently an independent non-executive director of Shangri-La Asia Limited and SUNeVision Holdings Ltd. (shares of the two companies are listed on the Hong Kong Stock Exchange). In addition, he serves in a number of government committees and the board of certain non-government organisations.

Mr. Wong obtained his Bachelor of Science in Physics from the University of Hong Kong and Master of Business Administration from the Chinese University of Hong Kong, and is a fellow of the Association of Chartered Certified Accountants, United Kingdom and a fellow of the Hong Kong Institute of Certified Public Accountants.

As at the Latest Practicable Date, Mr. Wong did not have any interest in any Shares within the meaning of the Securities and Futures Ordinance. The Company has given a letter of appointment to Mr. Wong pursuant to which Mr. Wong is appointed for a term commencing on 2 April 2007 and ending at the conclusion of the Annual General Meeting. Mr. Wong will be entitled to a Director’s fee of HK$100,000 per annum or such sum of director’s fee to be fixed by the Board of Directors pursuant to the authority granted by the Shareholders at the Company’s annual general meeting. Under Bye-Law 99 of the Company, Mr. Wong will be subject to retirement by rotation and eligible for re-election at the Company’s annual general meeting every three years.

Other than the aforesaid, Mr. Wong does not have any relationship with any Directors, senior management, substantial shareholders or controlling shareholders of the Company, there is no other information to be disclosed under rule 13.51(2) of the Listing Rules and there is no other matter that need to be brought to the attention of Shareholders.

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APPENDIX 3 DETAILS OF DIRECTORS PROPOSED TO BE RE-ELECTED

3. Tan Sri Dr. Khoo Kay Peng

Tan Sri Dr. Khoo Kay Peng, aged 68, was appointed a Director in June 1994. Tan Sri Dr. Khoo is Chairman and Chief Executive of The MUI Group, which is a business corporation with diversified operations in the Asia Pacific, the United States of America (“USA”) and the United Kingdom (“UK”). He is the Chairman of Malayan United Industries Berhad and MUI Properties Berhad, Malaysia (whose shares are listed on Bursa Malaysia, formerly known as the Kuala Lumpur Stock Exchange), Laura Ashley Holdings plc, UK (whose shares are listed on the London Stock Exchange), Corus Hotels plc, UK, Morning Star Resources Limited (whose shares are listed on the Hong Kong Stock Exchange). He is also a director of Pan Malaysian Industries Berhad, Malaysia (whose shares are listed on Bursa Malaysia) and The Bank of East Asia, Limited, Hong Kong (whose shares are listed on the Hong Kong Stock Exchange). He is a board member of Northwest University, Seattle, USA and serves as a Council Member of the Malaysian-British Business Council, the Malaysia-China Business Council and the Asia Business Council.

As at the Latest Practicable Date, Tan Sri Dr. Khoo was interested in 16,150,000 Shares within the meaning of the Securities and Futures Ordinance representing approximately 1.03% of the share capital of the Company in issued. The Company has given a letter of appointment to Tan Sri Dr. Khoo pursuant to which Tan Sri Dr. Khoo is appointed for a term commencing on 25 May 2005 (the date of his latest re-election as Director of the Company) and ending at the conclusion of the annual general meeting in 2008. In 2006, Tan Sri Dr. Khoo was entitled to a Director’s fee of HK$100,000 per annum which was fixed by the Board of Directors pursuant to the authority granted by the Shareholders at the Company’s annual general meeting. Under Bye-Law 99 of the Company, Tan Sri Dr. Khoo will be subject to retirement by rotation and eligible for re-election at the Company’s annual general meeting every three years.

Other than the aforesaid, Tan Sri Dr. Khoo does not have any relationship with any Directors, senior management, substantial shareholders or controlling shareholders of the Company, there is no other information to be disclosed under rule 13.51(2) of the Listing Rules and there is no other matter that need to be brought to the attention of Shareholders.

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RIGHT TO DEMAND A POLL

APPENDIX 4

Bye-Law 70 of the Bye-Laws sets out the procedures by which Shareholders may demand a poll:

At any general meeting, a resolution put to the vote of the meeting shall be decided on a show of hands unless a poll is demanded (before or on the declaration of the results of the show of hands or on the withdrawal of any other demand for a poll). A poll may be demanded by:

• (i) the chairman of the meeting;

• (ii) at least three Shareholders present in person or by a duly authorised corporate representative or by proxy for the time being entitled to vote at the meeting;

• (iii) any Shareholder or Shareholders present in person or by a duly authorised corporate representative or by proxy and representing not less than one-tenth of the total voting rights of all the Shareholders having the right to vote at the meeting; or

• (iv) any Shareholder or Shareholders present in person or by a duly authorised corporate representative or by proxy and holding shares in the Company, conferring a right to vote at the meeting being shares on which an aggregate sum has been paid up equal to not less than one-tenth of the total sum paid up on all the shares conferring that right.

Unless a poll be so demanded and the demand is not withdrawn, a declaration by the chairman of the meeting that a resolution has on a show of hands been carried or carried unanimously, or by a particular majority, or lost, and an entry to that effect in the book containing the minutes of the proceedings of the Company shall be conclusive evidence of the fact without proof of the number or proportion of the votes recorded in favour or against such resolution.

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