Styland Holdings Limited — Proxy Solicitation & Information Statement 2002

Aug 1, 2002

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold all your shares in Tak Sing Alliance Holdings Limited, you should at once hand this document together with the enclosed form of proxy to the purchaser(s) or to the bank, stockbroker or other agent through whom the sale was effected for transmission to the purchaser(s).

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.

TAK SING ALLIANCE HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

GENERAL MANDATES TO REPURCHASE SHARES

AND TO ISSUE NEW SHARES

A notice convening the Annual General Meeting of Tak Sing Alliance Holdings Limited to be held at Carrianna (Chiu Chow) Restaurant, 1st Floor, 151 Gloucester Road, Wanchai, Hong Kong on Thursday, 29 August 2002 at 11:00 a.m. is set out in the 2002 Annual Report. Whether or not you are able to attend the meeting in person, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon to the Company’s Registrars, Tengis Limited at 4th Floor, Hutchison House, 10 Harcourt Road, Central, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for the holding of the meeting or any adjournment thereof. Completion and return of the form of proxy shall not preclude you from attending and voting at the meeting or any adjourned meeting should you so desire.

26 July 2002

DEFINITIONS

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

“Annual General Meeting”

the annual general meeting of the Company convened to be held at Carrianna (Chiu Chow) Restaurant, 1st Floor, 151 Gloucester Road, Wanchai, Hong Kong on Thursday, 29 August 2002 at 11:00 a.m.

“Company”

Tak Sing Alliance Holdings Limited, a company incorporated in Bermuda with limited liability, the securities of which are listed on the Stock Exchange

• “Directors”

the directors of the Company

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

• “Latest Practicable Date” 26 July 2002, being the latest practicable date before 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

• “Share(s)” share(s) of HK$0.10 each in the capital of the Company

• “Shareholder(s)” shareholder(s) of the Company

• “Stock Exchange” The Stock Exchange of Hong Kong Limited

• “Takeover Code”

The Hong Kong Code on Takeovers and Mergers

• “Warrant(s)”

2002 Warrants in unit of HK$0.4 which entitles holders to subscribe for shares at an initial subscription price of HK$0.4 per Share, subject to adjustment, at any time from 18 February 2000 to 28 February 2002, both days inclusive. The 2002 Warrants expired on 28 February 2002

“HK$”

Hong Kong dollars, the lawful currency of Hong Kong

“%”

per cent.

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LETTER FROM THE BOARD

TAK SING ALLIANCE HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

Executive Directors: Ma Kai Cheung (Chairman) Ma Kai Yum (Managing Director) Ng Yan Kwong

Registered Office: Cedar House 41 Cedar Avenue Hamilton HM12 Bermuda

Non-executive Directors: Lau Wong Fat, GBS, JP Yip Hing Chung, MBE, JP Lo Ming Chi, Charles, JP

* Independent non-executive directors

Principal Place of Business: 26th Floor Phase II Wyler Centre 200 Tai Lin Pai Road Kwai Chung New Territories Hong Kong

26 July 2002

To the shareholders

Dear Sir/Madam,

INTRODUCTION

At the 2001 annual general meeting of the Company held on 22 August 2001, a general mandate was given to the Directors to exercise the powers of the Company to repurchase securities of the Company. Such mandate will lapse at the conclusion of the forthcoming Annual General Meeting. It is therefore proposed to seek your approval of an ordinary resolution to be proposed at the Annual General Meeting to give a fresh general mandate to the Directors to exercise the powers of the Company to repurchase securities of the Company.

The purpose of this circular is to provide you with information relating to the ordinary resolutions to be proposed at the forthcoming Annual General Meeting to grant the Directors a general mandate to exercise the powers of the Company to repurchase the Company’s fully paid up Shares up to a maximum of 10% of the total nominal amount of the share capital of the Company in issue on the date of the ordinary resolution (“Repurchase Mandate”), to grant a general mandate to the Directors to issue new Shares up to a maximum of 20% of the total nominal amount of the share capital of the Company in issue on the date of the relevant ordinary resolution and to increase the number of shares which the Directors may issue under the general mandate by the number of shares repurchased.

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LETTER FROM THE BOARD

In accordance with the Listing Rules, this circular also serves as the explanatory statement, to provide you with requisite information reasonably necessary to enable you to make an informed decision on whether to vote for or against Resolutions 5 to 7 to be proposed at the Annual General Meeting.

EXPLANATORY STATEMENT

1. LISTING RULES

The Listing Rules permit companies whose primary listing are on the Stock Exchange to repurchase their fully paid up securities on the Stock Exchange subject to certain restrictions, the most important of which are summarised below.

(a) Shareholders’ approval

The Listing Rules provide that all proposed repurchases of securities by a company with its primary listing on the Stock Exchange must be approved in advance by an ordinary resolution of shareholders, either by way of a general mandate or by a specific approval of a particular transaction.

(b) Source of Funds

Repurchases must be made out of funds which are legally available for such purpose in accordance with the Memorandum of Association, Bye-laws of the Company and the laws of Bermuda.

(c) Trading Restrictions

A maximum of 10% of the issued share capital as at the date of passing the relevant resolution may be repurchased on the Stock Exchange. No shares may be repurchased unless they are fully paid up.

2. SECURITIES OF THE COMPANY

As at 26 July 2002, the latest practicable date prior to the printing of this circular, the issued share capital of the Company was 732,587,219 Shares of HK$0.10 each.

Subject to the passing of the ordinary resolution 5, the Company would be allowed under the Repurchase Mandate to repurchase a maximum of 73,258,721 Shares on the basis that no further shares will be issued or repurchased prior to the date of the Annual General Meeting.

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LETTER FROM THE BOARD

3. REASONS FOR SHARE REPURCHASE

Although the Directors have no present intention of repurchasing any Shares, they believe that the flexibility afforded by the Repurchase Mandate would be beneficial to the Company and its shareholders. Trading conditions on the Stock Exchange have sometimes been volatile in recent years. At any time in the future when Shares are trading at a discount to their underlying value, the ability of the Company to repurchase Shares will be beneficial to those Shareholders who retain their investment in the Company since their percentage interest in the assets of the Company would increase in proportion to the number of Shares repurchased by the Company and thereby resulting in an increase in net assets and/or earnings per Share of the Company. Such repurchases will only be made when the Directors believe that such repurchases will benefit the Company and the Shareholders.

4. FUNDING OF REPURCHASES

The Directors propose that repurchases of Shares under the Repurchase Mandate in these circumstances would be financed from the Company’s internal resources.

In repurchasing Shares, the Company may only apply funds legally available for such purpose in accordance with the Memorandum of Association, Bye-laws of the Company, and the laws of Bermuda.

The Company is empowered by its Memorandum of Association and Bye-laws to purchase its Shares. Bermuda law provides that the amount of capital paid in connection with a share repurchase may only be paid out of either the capital paid up on the relevant shares, or the funds of the Company that would otherwise be available for dividend or distribution or the proceeds of a fresh issue of shares made for such purpose. The amount of premium payable on repurchase may only be paid out of funds of the Company that would otherwise be available for dividend or distribution or out of the share premium account of the Company.

There might be material adverse impact on the working capital or gearing position of the Company (as compared with the position disclosed in the audited accounts contained in the Annual Report for the year ended 31 March 2002) in the event that the Repurchase Mandate was to be carried out in full at any time during the proposed repurchase period. However, the Directors do not propose to exercise the Repurchase Mandate to such extent as would, in the circumstances, have a material adverse effect on the working capital requirements of the Company or the gearing levels which in the opinion of the Directors are from time to time appropriate for the Company.

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LETTER FROM THE BOARD

5. MARKET PRICES

The highest and lowest prices at which Shares and Warrants of the Company have been traded on the Stock Exchange during each of the previous 12 months were as follows:

	Shares		Warrants	Warrants
	Highest	Lowest	Highest	Lowest
	HK$	HK$	HK$	HK$
2001
July	0.270	0.230	0.260	0.230
August	0.250	0.229	0.100	0.018
September	0.230	0.180	0.105	0.080
October	0.205	0.185	0.108	0.090
November	0.315	0.200	0.060	0.120
December	0.295	0.250	0.092	0.045
2002
January	0.270	0.242	0.025	0.025
February	0.260	0.242	–	–
March	0.230	0.223	–	–
April	0.315	0.265	–	–
May	0.355	0.280	–	–
June	0.330	0.241	–	–

6. UNDERTAKING OF THE DIRECTORS

The Directors have undertaken to the Stock Exchange to exercise the powers of the Company to make purchases under the Repurchase Mandate in accordance with the Listing Rules and laws of Bermuda.

None of the Directors nor, to the best of their knowledge having made all reasonable enquiries, any of their associates, presently intends to sell Shares to the Company under the Repurchase Mandate in the event that the proposal of the Repurchase Mandate is approved by the Shareholders.

The Company has not been notified by any connected persons of the Company that they have a present intention to sell any Shares, or that they have undertaken not to sell any Shares held by them to the Company in the event that the proposal of the Repurchase Mandate is approved by the Shareholders.

7. DISCLOSURE OF INTERESTS

If as a result of a Share repurchase by the Company, a substantial Shareholder’s proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition for the purpose of the Takeover Code. Accordingly, a Shareholder, or group of Shareholders acting in concert, could obtain or consolidate control of the Company or become obliged to make a mandatory offer in accordance with Rule 26 of the Takeover Code.

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LETTER FROM THE BOARD

As at 26 July 2002, the latest practicable date prior to the printing of this circular, Mr Ma Kai Cheung and Mr Ma Kai Yum, Directors of the Company, were interested in 400,640,065 Shares, together representing approximately 54.69% of the Shares issued by the Company. In the event that the Directors exercised in full the power to repurchase Shares of the Company in accordance with the terms of the ordinary resolution to be proposed at the Annual General Meeting, the total interests of Mr Ma Kai Cheung and Mr Ma Kai Yum in the Shares of the Company would be increased to approximately 60.76% of the issued Shares of the Company. The Directors are not aware of any consequences which will arise under the Takeover Code as a result of any purchases to be made under the Repurchase Mandate.

8. PURCHASE OF SECURITIES MADE BY THE COMPANY

No purchase of Shares or Warrants has been made by the Company during the last six months (whether on the Stock Exchange or otherwise).

RESOLUTIONS TO BE PROPOSED AT THE ANNUAL GENERAL MEETING

The ordinary resolution no. 5 to be proposed at the Annual General Meeting relates to the granting of the Repurchase Mandate to the Directors.

The ordinary resolution no. 6 to be proposed at the Annual General Meeting relates to the granting of a general mandate to the Directors to issue new Shares up to a maximum of 20% of the issued share capital of the Company as at the date of the passing of the resolution.

The ordinary resolution no. 7 to be proposed at the Annual General Meeting relates to the extension of the general mandate to be granted to the Directors to issue new Shares during the relevant period by adding to it the number of Shares repurchased by the Company under the Repurchase Mandate, if any.

PROXY ARRANGEMENT

A form of proxy for use at the Annual General Meeting is enclosed with the 2002 Annual Report. To be valid, the form of proxy must be completed in accordance with the instructions printed thereon and deposited, together with the power of attorney or other authority (if any) under which it is signed or a notarially certified copy of that power of attorney or authority at the Company’s Share Registrars in Hong Kong, Tengis Limited, at 4/F., Hutchison House, 10 Harcourt Road, Central, Hong Kong not less than 48 hours before the time appointed for holding the meeting. Completion and delivery of the form of proxy will not prevent you from attending and voting at the Annual General Meeting.

RECOMMENDATION

The Directors believe that the granting of the Repurchase Mandate, the granting of the general mandate to issue new Shares and the extension thereof are in the best interest of the Company and the Shareholders as a whole. Accordingly, the Directors recommend you to vote in favour of all the ordinary resolutions no. 5 to 7 to be proposed at the Annual General Meeting.

By Order of the Board Ma Kai Cheung

Chairman

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