Sinopec Engineering Group Co Ltd. — Capital/Financing Update 2006

Jan 24, 2006

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.

UNIVERSE INTERNATIONAL HOLDINGS LIMITED 寰宇國際控股有限公司 [*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 1046)

CONNECTED TRANSACTION Acquisition of Certain Film Titles

The Board announces that on 23 January 2006, Universe Laser & Video, an indirect wholly-owned subsidiary of the Company and Universe Film Productions have entered into an unconditional multiple rights assignment whereby Universe Laser & Video acquired the full and complete rights, titles and interests in and to the Films and the Previous Agreements from Universe Film Productions for a total consideration of HK$3,160,000.

The consideration for the Acquisition was determined at the Films Valuation after arm’s length negotiations between the Group and Universe Film Productions with reference to the Films Valuation.

The Acquisition will benefit the Group in that they enable the Group to enhance its portfolio of movie titles and to strengthen its marketing position in the promotion of the movie contents to a variety of media operators.

The entire issued share capital of Universe Film Productions, the assignor of the Films and the Previous Agreements, is beneficially owned by Globalcrest, the entire issued share capital of which is in turn held by Central Core Resources Limited, the trustee of a discretionary trust under which certain immediate family members of Mr. Lam and Ms. Chiu Suet Ying are discretionary objects. Globalcrest, a substantial shareholder of the Company and a connected person of the Company within the meaning of the Listing Rules, owns approximately 53.7% of the entire issued Shares as at the date of this announcement. Mr. Lam is also a founder of the said discretionary trust. By virtue of the interest of Globalcrest in Universe Film Productions, the Acquisition constitutes a connected transaction for the Company under Rule 14A.13(1)(a) of the Listing Rules.

Each of the applicable “percentage ratios” (as defined in the Listing Rules) for the Acquisition is either less than 2.5 per cent. or more than 2.5 per cent but less than 25 per cent and the total consideration is less than HK$10,000,000. Therefore the Acquisition satisfies the exemption under Rule 14A.32(2) of the Listing Rules and is only subject to the reporting and the announcement requirements set out in Rules 14A.45 to 14A.47 and exempt from independent shareholders’ approval requirements under Chapter 14A of the Listing Rules.

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1. THE ASSIGNMENT

Date

23 January 2006

Parties to the Assignment

Assignee: Universe Laser & Video

Assignor: Universe Film Productions

The Films

Universe Laser & Video and Universe Film Productions have entered into an unconditional multiple rights assignment whereby Universe Laser & Video acquired the full and complete rights, titles and interests in and to the Films and the Previous Agreements from Universe Film Productions.

Universe Film Productions is principally engaged in the production of Chinese language motion pictures and sub-licensing of film rights. The principal assets of Universe Film Productions consist of the Films.

The Films comprise seven completed motion picture titles with rights in all languages. Upon acquisition of the Films, the Group will have the exclusive right to exploit the Films by all means and in all media worldwide.

Consideration

The total consideration for the Acquisition is HK$3,160,000 and is payable in cash after execution of the Assignment and receipt and acceptance by the Company of all relevant materials under the Assignment. The consideration has been agreed at the Films Valuation prepared by BMI Appraisals as at 31 December 2005 after arm’s length negotiations between the Group and Universe Film Productions with reference to the Films Valuation. Five of the motion picture titles out of the Films were produced by Universe Film Productions between 1994 and 1995 and the total production costs thereof was approximately HK$21,873,500. The two remaining motion picture titles of the Films were produced in 1997 and acquired by Universe Film Productions in 2005 for a total consideration of HK$2,500,000.

2. VALUATION OF THE FILMS

The market value of the Films as at 31 December 2005 is HK$3,160,000 as valued by an independent valuation of BMI Appraisals. The valuation has been carried out on an open market basis by using the comparison method assuming sale of the Films in its existing state by making reference to comparable sales evidence as available in the relevant market. Appropriate adjustments have been made by BMI Appraisals to account for the differences between the Films and the comparables in terms of production costs, time and other relevant factors. The factors considered included the following:

• (a) the business nature and operational history of the Films;

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• (b) the existing financial condition of the Films;

• (c) the terms and conditions of the contracts and the agreements in relation to the business of the Films;

• (d) the economic condition and the industry outlook in general;

• (e) the specific economic environment and competition for the Films; and

• (f) the financial and business risks of the Films.

The major assumptions adopted in the valuation are as follows:

• (a) there will be no major changes in the existing political, legal, and economic conditions in the jurisdictions in which the Films are operating and/or will operate;

• (b) there will be no major changes in the current taxation laws in the jurisdictions in which the Films are operating and/or will operate, that the rates of tax payable remain unchanged and that all applicable laws and regulations will be complied with; and

• (c) availability of capital and sources of funding will not be a constraint to the development plan of the Films.

3. REASONS AND BENEFITS FOR THE ACQUISITION

The Group is principally engaged in the business of motion picture and television series production, distribution of programmes in various videogram formats, licensing and sub-licensing of programmes rights and film exhibition and leasing of investment properties.

The Directors believe that the Acquisition will benefit the Group in that they enable the Group to enhance its portfolio of movie titles and to strengthen its marketing position in the promotion of the movie contents to a variety of media operators. The Directors also believe that the Acquisition is an infrequent opportunity for the Group to acquire full and complete rights, titles and interests in Chinese language motion picture titles which does not have a readily available market for acquisition. In addition, with the huge demand for Chinese language motion picture titles resulting from the introduction of new media and channels, the Acquisition will also enhance the competitiveness of the Group in the market.

4. COMPLIANCE WITH THE LISTING RULES

The entire issued share capital of Universe Film Productions, the assignor of the Films and the Previous Agreements, is beneficially owned by Globalcrest, the entire issued share capital of which is in turn held by Central Core Resources Limited, the trustee of a discretionary trust under which certain immediate family members of Mr. Lam and Ms. Chiu Suet Ying are discretionary objects. Globalcrest, a substantial shareholder of the Company and a connected person of the Company within the meaning of the Listing Rules, owns approximately 53.7% of the entire issued Shares as at the date of this announcement. Mr. Lam is also a founder of the said discretionary trust. By virtue of the interest of Globalcrest in Universe Film Productions, the Acquisition constitutes a connected transaction for the Company under Rule 14A.13(1)(a) of the Listing Rules.

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Each of the applicable “percentage ratios” (as defined in the Listing Rules) for the Acquisition is either less than 2.5 per cent. or more than 2.5 per cent but less than 25 per cent and the total consideration is less than HK$10,000,000. Therefore the Acquisition satisfies the exemption under Rule 14A.32(2) of the Listing Rules and is only subject to the reporting and the announcement requirements set out in Rules 14A.45 to 14A.47 and exempt from independent shareholders’ approval requirements under Chapter 14A of the Listing Rules.

The Directors (except Mr. Lam and Ms. Chiu Suet Ying who abstained from participating in the approval of the Assignment due to conflict of interest), including the independent non-executive Directors, believe the terms of the Assignment are based on normal commercial terms and are fair and reasonable as far as the shareholders of the Company are concerned and are in the interest of the Company as a whole.

The purpose of this announcement is to supply shareholders of the Company with information relating to the Acquisition. Details of the Acquisition will also be included in the next published annual report of the Company.

5. DEFINITIONS

• “Acquisition” the acquisition of the Films pursuant to the Assignment

“Assignment” the multiple rights assignment dated 23 January 2006 between Universe Laser & Video and Universe Film Productions

“BMI Appraisals” BMI Appraisals Limited, an independent firm of qualified professional valuers

“Board” the board of Directors “Company” Universe International Holdings Limited, a company incorporated in Bermuda with limited liability and the Shares are listed on the Stock Exchange

• “Films” the rights, titles and interests in and to seven completed motion picture titles produced between 1994 and 1997 and all the physical materials pertaining thereto, acquired by Universe Laser & Video pursuant to the Assignment

• “Films Valuation” HK$3,160,000, the market value of the Films as at 31 December 2005 valued by BMI Appraisals

• “Globalcrest” Globalcrest Enterprises Limited, a company incorporated in the British Virgin Islands with limited liability

• “Group” The Company and its subsidiaries

“Hong Kong” the Hong Kong Special Administrative Region of the People’s Republic of China

“Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange

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Mr. Lam Shiu Ming, Daneil, a Director

“Mr. Lam”

“Previous Agreements”

the rights, titles and interests in and to the previous agreements in connection with the Films

“Shares”

shares of HK$0.02 each in the capital of the Company

“Stock Exchange”

The Stock Exchange of Hong Kong Limited

“Universe Film Productions”

Universe Film Productions Company Limited, a company incorporated in Hong Kong with limited liability and the entire issued share capital is beneficially owned by Globalcrest

“Universe Laser & Video”

Universe Laser & Video Co., Limited, a company incorporated in Hong Kong with limited liability and an indirect whollyowned subsidiary of the Company

The Board as at the date hereof comprises:

Mr. Lam Shiu Ming, Daneil

(Chairman and Executive Director)

Mr. Ng Kwok Tung

(Independent non-executive Director)

Ms. Chiu Suet Ying

(Executive Director)

Mr. Chiu Shin Koi

(Independent non-executive Director)

Mr. Yeung Kim Piu

(Executive Director)

Mr. Ma Ting Hung

(Independent non-executive Director)

By Order of the Board Lam Shiu Ming, Daneil Chairman

Hong Kong, 23 January 2006

* for identification purposes only

Please also refer to the published version of this announcement in the China Daily.

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