Styland Holdings Limited — Proxy Solicitation & Information Statement 2007

Jun 18, 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 a licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Tak Sing Alliance Holdings Limited, you should at once hand this circular to the purchaser or transferee, or to the bank, licensed securities dealer 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.

This circular is for information purpose only and does not constitute an invitation or offer to acquire or subscribe for shares in Tak Sing Alliance Holdings Limited.

TAK SING ALLIANCE HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code: 126)

DISCLOSEABLE AND CONNECTED TRANSACTION RELATING TO PROPOSED ACQUISITION OF ADDITIONAL INTERESTS IN PRC JOINT VENTURE

Independent financial adviser to the Independent Board Committee and the Independent Shareholders

A letter from the Independent Board Committee containing its recommendation to the Independent Shareholders is set out on page 20 of this circular. A letter from Partners Capital International Limited containing its advice to the Independent Board Committee and the Independent Shareholders is set out on pages 21 to 40 of this circular.

A notice convening a special 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, 23 August 2007 at 11:30 a.m. is set out on pages 59 to 60 of this circular. A form of proxy for use at the meeting is enclosed. Whether or not you are able to attend the special general meeting in person, please complete and return the enclosed form of proxy in accordance with the instructions printed thereon and return the same to the Company’s branch share registrar in Hong Kong, Tengis Limited, located at 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong and in any event not later than 48 hours before the time appointed for holding of the meeting or any adjourned meeting. Completion of a form of proxy will not preclude you from attending and voting in person at the special general meeting or any adjourned meeting should you so wish.

18 June 2007

CONTENTS

	Page
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
LETTER FROM THE INDEPENDENT BOARD COMMITTEE . . . . . . . . . . . . . . . . . . . .	20
LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED . . . . . . . . . . . . .	21
APPENDIX I PROPERTY VALUATION REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	41
APPENDIX II GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	50
NOTICE OF SPECIAL GENERAL MEETING OF THE COMPANY. . . . . . . . . . . . . . . .	59
ACCOMPANYING DOCUMENT – PROXY FORM

– i –

DEFINITIONS

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

“Acquisition” the acquisition of the Sales Interests in accordance with the provisions of the Agreement “Agreement” a sale and purchase agreement dated 25 May 2007 between the Company and the Vendor in respect of the sale and purchase of 20% of the equity interests of JV Co together with all rights and obligations accruing or attached thereto “Amending Agreement” the agreement in the form to be agreed by the Company and to be entered into between the Vendor, the Company and the other shareholders of JV Co for the amendment and restatement of the JV Contract and the Articles of Association respectively, as a result of the Acquisition

“Approval Authority” the authority which has the power to approve the sale of Sales Interests and the amendment and restatement of the JV Contract and the Articles of Association and/or which originally approved the establishment of JV Co, the JV Contract and the Articles of Association and all other transactions contemplated in this Agreement

“Articles of Association”	the articles of association of JV Co as amended from time
	to time
“associate(s)”	has the meaning ascribed to it under the Listing Rules
“Board”	the board of directors of the Company
“Business Day”	a day other than a Saturday, Sunday or a statutory holiday
	in the PRC or Hong Kong
“Business Development”	the residential and commercial development of the Project
“Company” or the “Purchaser”	Tak Sing Alliance Holdings Limited, an exempted company
	duly incorporated with limited liability in Bermuda and
	whose Shares are listed and traded on the Main Board of
	the Stock Exchange

– 1 –

DEFINITIONS

“Completion”	completion of the Acquisition contemplated under the
	Agreement
“connected person”	has the meaning ascribed to it under the Listing Rules
“Consideration Shares”	in aggregate 30,476,677 new Shares to be issued by the
	Company to the Vendor at issue price of HK$2.80 per Share
	(equivalent to approximately RMB2.74) as part of the
	Consideration payable to the Vendor under the Agreement
“Controlling Shareholder”	has the meaning ascribed to it under the Listing Rules
“Cooperation and Development	the Overall Development and Operation Cooperation
Agreement”	Agreement（整體開發經營合作合同）entered into between
	JV Co and The People’s Government of Yiyang City, Hunan
	Province on 16 October 2005 in relation to the development
	of the Zishanhu Theme Park on the Property
“Director(s)”	the director(s) of the Company
“Enlarged Group”	the Group as enlarged by the inclusion of JV Co
“Former Acquisition”	the acquisition of an aggregate of 55% of the equity interests
	in the JV Co by the Company pursuant to an agreement
	dated 8 February 2007 and entered into between the
	Company as purchaser and KC Ma and KY Ma collectively
	as vendors
“Framework Agreement”	the Hunan Yiyang Zishanhu Zhuti Gongyuan Framework
	Agreement（湖南益陽梓山湖主題公園框架協議書）
	entered into between JV Co and The People’s Government
	of Yiyang City, Hunan Province on 9 October 2005 in
	relation to the development of the Zishanhu Theme Park on
	the Property
“Group”	the Company and its subsidiaries
“Hong Kong”	the Hong Kong Special Administrative Region of the PRC

– 2 –

DEFINITIONS

“Indemnifier”	the Vendor
“Independent Board Committee”	the independent board committee of the Board, comprising
	Messrs. Lo Ming Chi, Charles, Yau Wing Keung and Lo
	Man Kit, Sam, the independent non-executive Directors
“Independent Shareholders”	Shareholders who are not involved in or interested in the
	Acquisition
“Issue Price”	the price of HK$2.80 (equivalent to approximately
	RMB2.74) per Consideration Share
“JV Co”	佳寧娜（湖南）實業有限公司(Carrianna (Hunan)
	Enterprise Co. Ltd.), a Chinese foreign equity joint venture
	enterprise established under the laws of the PRC on 10
	October 2005 with a total registered capital of
	RMB100,000,000
“JV Contract”	the equity joint venture agreement entered into among the
	shareholders of the Vendor and four other individuals being
	the joint venture partners on 30 September 2005 in respect
	of the JV Co
“KC Ma”	Mr. Ma Kai Cheung, a Controlling Shareholder of the
	Company
“KY Ma”	Mr. Ma Kai Yum, a Substantial Shareholder of the Company
“Last Trading Day”	23 May 2007, being the last trading day immediately prior
	to the date of the Agreement
“Latest Practicable Date”	12 June 2007, being the latest practicable date prior to the
	printing of this circular for ascertaining certain information
	contained herein
“Listing Committee”	has the meaning ascribed to it under the Listing Rules
“Listing Rules”	the Rules Governing the Listing of Securities on The Stock
	Exchange of Hong Kong Limited
“Mu”	畝, 1 Mu is equivalent to approximately 666.67 sq. m.

– 3 –

DEFINITIONS

“Park Agreements”	the Framework Agreement and the Cooperation and
	Development Agreement as amended by the Supplemental
	Park Agreements, pursuant to which the JV Co has the
	right to develop and manage the Project
“Parties”	the Company and the Vendor
“PRC”	The People’s Republic of China
“Project”	the Zishanhu Theme Park（梓山湖主題公園）Project which
	JV Co has the right to develop and manage pursuant to the
	terms of the Framework Agreement and the Cooperation
	and Development Agreement, including the development
	of residential and commercial units, a citizen square, a theme
	park, and the lake surface project
“Public Development”	the public utilities portion of the Project, including the
	citizen square, theme park and the lake surface project
“Sales Interests”	20% of the equity interests of JV Co and representing
	RMB20,000,000 of the registered capital of JV Co, together
	with all rights and obligations accruing or attached thereto
	held by the Vendor
“SFO”	the Securities and Futures Ordinance (Chapter 571) of the
	Laws of Hong Kong
“SGM”	the special general meeting of the Company to be held on
	Thursday, 23 August 2007 at 11:30 a.m. for the purpose of
	approving the Acquisition and all other transactions
	contemplated thereunder by the Independent Shareholders,
	the notice of which is set out on pages 59 to 60 of this
	circular
“Share(s)”	ordinary share(s) of HK$0.10 each in the share capital of
	the Company
“Shareholder(s)”	shareholder(s) of the Company
“Special Mandate”	the special mandate to be sought from Independent
	Shareholders at the SGM by a resolution in respect of the
	issue and allotment of the Consideration Shares pursuant to
	the Acquisition

– 4 –

DEFINITIONS

“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Substantial Shareholder”	has the meaning ascribed to it under the Listing Rules
“Supplemental Cooperation and	the Memorandum to the Overall Development and Operation
Development Agreement”	Cooperation Agreement（湖南省益陽梓山湖公園整體開發
	經營合作合同的備忘錄）entered into between JV Co and
	The People’s Government of Yiyang City, Hunan Province
	on 30 March 2007 to supplement the Cooperation and
	Development Agreement
“Supplemental Framework	the Memorandum to the Hunan Yiyang Zishanhu
Agreement”	Zhutigonyuan Framework Agreement（湖南益陽梓山湖主
	題公園框架協議書的備忘錄）entered into between JV Co
	and The People’s Government of Yiyang City, Hunan
	Province on 30 March 2007 to supplement the Framework
	Agreement
“Supplemental Park Agreements”	the Supplemental Cooperation and Development Agreement
	and the Supplemental Framework Agreement
“The Codes”	The Codes on Takeovers and Mergers and Share
	Repurchases of the Securities and Futures Commission
“Valuer”	Vigers Appraisal & Consulting Limited, which is an
	independent third party not connected with the directors,
	chief executive or substantial shareholders of the Company
	or any of its subsidiaries or their respective associates as
	defined in the Listing Rules.
“Vendor”	益陽市銀業發工貿有限公司(Yiyang Yin Ye Fa Industrial
	and Trading Co., Ltd.*), a limited liability company
	established under the laws of the PRC
“HK$”	Hong Kong dollar, the lawful currency of Hong Kong
“RMB”	Renminbi yuan, the lawful currency of the PRC
“sq.m.”	square meter, an area measurement unit
“%”	percentage or per centum

– 5 –

DEFINITIONS

If there is any inconsistency between the Chinese name of the entities and their English translation in this circular, the Chinese version shall prevail.

For the purpose of this circular, unless otherwise indicated, conversion of RMB into HK$ is based on the exchange rate of RMB0.9785 = HK$1.00. This exchange rate is for the purpose of illustration only and does not constitute a representation on that any amounts have been, could have been, or may be exchanged at this or any other rate at all.

• For identification purposes only

– 6 –

LETTER FROM THE BOARD

TAK SING ALLIANCE HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code: 126)

Executive Directors:– Mr. Ma Kai Cheung, PhD, BBS (Chairman) Mr. Ma Kai Yum, PhD Mr. Ng Yan Kwong

Registered Office:– Canon’s Court, 22 Victoria Street, Hamilton HM12, Bermuda

Non-Executive Directors:–

Mr. Yip Hing Chung, BBS, MBE, JP Mr. Zhang Huaqiao

Independent Non-Executive Directors:-

Mr. Lo Ming Chi, Charles, JP Mr. Yau Wing Keung Mr. Lo Man Kit, Sam

Head office and Principal place of business in Hong Kong:– 26/F, Wyler Centre, Phase II, 200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong

18 June 2007

To the Shareholders

Dear Sir or Madam,

DISCLOSEABLE AND CONNECTED TRANSACTION RELATING TO PROPOSED ACQUISITION OF ADDITIONAL INTERESTS IN PRC JOINT VENTURE

INTRODUCTION

On 28 May 2007, the Board announced that on 25 May 2007, the Agreement was entered into between the Company and the Vendor in connection with a proposed discloseable and connected transaction relating to acquisition of the Sales Interests in the JV Co.

The independent board committee of the Company, comprising all the independent nonexecutive Directors, has been formed to consider the terms of the Agreement and advise the Independent Shareholders as to whether the terms of the Agreement are agreed on normal commercial terms and are fair and reasonable and in the interest of the Shareholders as a whole.

– 7 –

LETTER FROM THE BOARD

Partners Capital International Limited, an independent financial adviser, has been appointed to advise the independent board committee and the Independent Shareholders as to whether the terms of the Agreement are agreed on normal commercial terms and are fair and reasonable and in the interest of Shareholders as a whole.

The purpose of this circular is (a) to provide you with further details of the Agreement, (b) to set out the advice and recommendation of the Independent Board Committee in respect of the terms of the Agreement and the Acquisition, and (c) to set out the advice and recommendation of Partners Capital International Limited in respect of the Agreement and the Acquisition.

BACKGROUND

On 28 May 2007, the Company announced that the Company entered into the Agreement with the Vendor on 25 May 2007 in relation to the proposed acquisition of the Sales Interests at a consideration of RMB167,000,000 (the “ Consideration ”) which represents a discount of 17.5% to the valuation figure of the Sales Interests. The Consideration will be satisfied as to RMB83,500,000 by cash and RMB83,500,000 by the issue of 30,476,677 Consideration Shares. Upon Completion, the Company will be interested in 75% of the registered capital of the JV Co.

Since certain of the percentage ratios under Chapter 14 of the Listing Rules for the Acquisition are 5% or more but less than 25%, the Acquisition constitutes a discloseable transaction for the Company under the Listing Rules. The Former Acquisition has been completed on 25 May 2007 and as a result thereof, the JV Co has become a subsidiary of the Company. Given that one of the shareholders of the Vendor is a director of the JV Co holding 50% interests in the registered capital of the Vendor (thereby rendering the Vendor an associate (as defined under the Listing Rules) of the said director), the Acquisition also constitutes a connected transaction for the Company under the Listing Rules. Accordingly, the Acquisition is subject to the reporting, announcement and Independent Shareholders’ approval requirements, by way of poll at a shareholders’ general meeting, as set out in the relevant provisions of Chapters 14 and 14A of the Listing Rules. As the interests of KC Ma and KY Ma, the Controlling Shareholder and Substantial Shareholder of the Company respectively are identical with those of the other Shareholders as a general body, both KC Ma and KY Ma shall be entitled to vote at the relevant shareholders’ meeting approving, inter alia, the Acquisition. As such, none of the Shareholders is required to abstain from voting at the SGM for approving, inter alia, the Acquisition.

– 8 –

LETTER FROM THE BOARD

THE AGREEMENT

Date: 25 May 2007

Parties:

Purchaser: The Company

Vendor: 益陽市銀業發工貿有限公司 (Yiyang Yin Ye Fa Industrial and Trading Co., Ltd.*)

The Proposed Acquisition

The Sales Interests represent 20% of the equity interests of the JV Co held by the Vendor and being RMB20,000,000 of the registered capital of JV Co, together with all rights and obligations accruing or attached thereto.

The JV Co is a Sino-foreign equity joint venture enterprise established under the laws of the PRC on 10 October 2005 with a total registered capital of RMB100,000,000. At the time of establishment of the JV Co, the shareholders of the Vendor and four other individual shareholders were the joint venture partners of the JV Co. The Vendor owns 35% equity interests in the JV Co and has contributed RMB35,000,000 towards the registered capital of the JV Co.

Upon completion of the Former Acquisition on 25 May 2007, the JV Co has become a subsidiary of the Company and the JV Co has been accounted for as a subsidiary of the Company for the purposes of preparing the Group accounts of the Company. The results of the JV Co will be consolidated with the results of the Company for the coming financial year.

Upon Completion, the interests of the Vendor in the JV Co will be reduced to 15%.

Consideration and mode of settlement

The Consideration for the Acquisition of the Sales Interests is RMB167,000,000 which shall be paid in the following manner:

• (a) the Purchaser shall pay a total of RMB16,700,000 in cash or by way of wire transfer of readily available funds to the Vendor or as it may direct within 30 days of Completion;

• (b) the Purchaser shall at Completion issue and allot a total of 30,476,677 new Shares (at the Issue Price) in the capital of the Purchaser to the Vendor or its nominee(s);

– 9 –

LETTER FROM THE BOARD

• (c) the Purchaser shall pay a total of RMB33,400,000 in cash or by way of wire transfer of readily available funds to the Vendor or as it may direct on or before the date falling on the expiry of 6 months after Completion; and

• (d) the Purchaser shall pay a total of RMB33,400,000 in cash or by way of wire transfer of readily available funds to the Vendor or as it may direct on or before the date falling on the expiry of 12 months after Completion.

The Acquisition will be funded by internal resources of the Company.

The Consideration Shares represent:

• (a) approximately 3.1% of the issued share capital of the Company as at the date of the Agreement; and

• (b) approximately 3.0% of the enlarged issued share capital of the Company after the issue and allotment of the Consideration Shares upon Completion.

There will not be any change in control of the Company as a result of the issue of the Consideration Shares.

The Consideration for the Acquisition has been determined after arm’s length negotiations between the Company and the Vendor by reference to (i) the valuation as at 31 December 2006 as prepared for the Former Acquisition and (ii) the latest development of the Project. Pursuant to the circular issued by the Company on 30 March 2007, valuation of the 55% interests in the JV Co under the Former Acquisition was RMB556.6 million. With reference to such valuation, the implied value of the Sales Interests on a pro-rata basis would be RMB202.4 million. In this connection, the Consideration would represent approximately a 17.5% discount to the said implied value of the Sales Interests. Full details of a valuation report regarding the real property owned by the JV Co is included in Appendix I of this circular.

The Directors (excluding the three independent non-executive directors of the Company) consider that the terms of the Acquisition are fair and reasonable and are in the interests of the Company and the Shareholders as a whole. The three independent non-executive directors of the Company have formed a view that the terms of the Agreement and the Acquisition are fair and reasonable and their view and advice to the Independent Shareholders are included in this circular.

– 10 –

LETTER FROM THE BOARD

Change in Shareholding Structure of the Company

As at the Latest Practicable Date, the authorized share capital of the Company was HK$200,000,000 divided into 2,000,000,000 shares of HK$0.1 each, of which 979,345,651 shares of HK$0.1 each were issued and fully paid up. The Company only has one class of shares.

Set out below is the summary of the change in shareholding structure of the Company after Completion:–

As at the Latest Beneficial owner Nature of Interest Practicable Date KC Ma_(note 6) Personal interest 21.75% Family interest(Note 1) 0.95% Other interest(Note 2) 26.46% 49.16% KY Ma(note 6) Personal interest 4.19% Family interest(Note 3) 0.28% Other interest (Notes 4 and 5)_ 10.33% 14.80% Sub-total for KC Ma & KY Ma and their concert parties 63.96% Public 36.04% Total 100.00%	Immediately after Completion 21.09% 0.92% 25.66%
	47.67%
	4.07% 0.27% 10.02%
	14.36%
	62.03%
	37.97%
	100.00%

– 11 –

LETTER FROM THE BOARD

Notes:

1. The Shares are owned by Cheung Lin Kiu, the spouse of KC Ma.

2. KC Ma and his family are the objects of a discretionary trust which effectively owns the entire issued share capital of Regent World Investments Limited (“ Regent World ”) and 70% of the entire issued share capital of Bond Well Investments Limited (“ Bond Well ”). At the date of this circular, Regent World owned 184,121,625 Shares and Bond Well owned 75,007,400 Shares of the Company.

3. The Shares are owned by Kwok Kit Mei, the spouse of KY Ma.

4. KY Ma and his family are the objects of a discretionary trust which effectively owns the entire issued share capital of Grand Wealth Investments Limited (“ Grand Wealth ”) and Peaceful World Limited (“ Peaceful World ”). At the date of this circular, Grand Wealth owned 74,651,040 Shares and Peaceful World owned 19,050,000 Shares of the Company.

5. Peaceful World owns the entire issued share capital of Real Potential Limited (“ Real Potential ”). At the date of this circular, Real Potential owned 7,500,000 Shares of the Company. The interests of Real Potential in the Company are therefore deemed to be the interests of Peaceful World in which KY Ma is also deemed to have interests for the reason as stated in note 4 above.

6. KC Ma and KY Ma are siblings and are acting in concert with each other since they became the Shareholders.

Issue Price

The Issue Price of HK$2.80 per Share represents:

• (a) a discount of approximately 6.0% to the closing price of the Shares of HK$2.98 per Share on the Last Trading Day;

• (b) a premium of approximately 1.8% to the average closing price of approximately HK$2.75 per Share for the last 5 consecutive trading days up to and including the Last Trading Day;

• (c) a premium of approximately 10.2% to the average closing price of approximately HK$2.54 per Share for the last 10 consecutive trading days up to and including the Last Trading Day;

• (d) a premium of approximately 10.7% to the average closing price of approximately HK$2.53 per Share for the last 30 consecutive trading days up to and including the Last Trading Day;

– 12 –

LETTER FROM THE BOARD

• (e) a premium of approximately 56.4% to the latest published net asset value of approximately HK$1.79 per Share as of 30 September 2006 as set out in the interim report of the Company dated 15 December 2006; and

• (f) a discount of approximately 20.0% to the closing price of HK$3.50 per Share as quoted on the Stock Exchange on the Latest Practicable Date.

Undertaking of the Vendor

The Vendor covenants and undertakes to the Company that it shall not and that it shall procure its shareholders shall not directly or indirectly sell, transfer, assign, give away, part with possession or otherwise dispose of the Consideration Shares for a period of 6 months after Completion without the prior written consent of the Company.

Special Mandate to issue Consideration Shares

The Consideration Shares will be issued under the Special Mandate to be sought from the Independent Shareholders at the SGM.

The Company will apply to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Consideration Shares.

Conditions Precedent

Completion is subject to the satisfaction of the following conditions (the “ Conditions ”):

• (a) the Purchaser obtaining the necessary approval from its shareholders (or from such Shareholders of the Company who are Independent Shareholders as may be agreed with the Stock Exchange) by poll at a special general meeting of the Purchaser approving the transactions contemplated in the Agreement, including but not limited to the purchase of the Sales Interests and the issue and allotment of Consideration Shares as part payment of the Consideration;

• (b) the Stock Exchange granting its approval of the listing of, and permission to deal in, the Consideration Shares to be issued as part of the Consideration for the purchase of the Sales Interests pursuant to the terms of the Agreement;

• (c) the listing status of the Purchaser with the Stock Exchange has not been revoked and trading of the Shares has not been suspended for more than 7 consecutive trading days for reasons other than the transactions contemplated in the Agreement;

– 13 –

LETTER FROM THE BOARD

• (d) all the shareholders of JV Co (other than the Vendor) have given their written consents to and waive each of their respective pre-emption rights or rights of first refusal arising from the Acquisition;

• (e) the Purchaser having received a deed of indemnity from the Indemnifier to the effect that the Indemnifier shall indemnify the Purchaser for losses of up to RMB86,000,000 in the event that (i) the JV Co participates in the acquisition process but fails to acquire any portion of the 2,000 Mu of land and/or (ii) the JV Co’s costs of acquisition of any portion of the 2,000 Mu of land is higher than RMB 210,000 per Mu, by way of public listing in accordance with the terms of the Park Agreements and the contents of the said deed of indemnity shall be acceptable to the Purchaser;

• (f) granting of the approval of the Acquisition pursuant to the Agreement and the JV Contract and the Articles of Association as amended and restated by the Amending Agreement by the Approval Authority and the issue of a revised approval certificate issued by the Approval Authority showing the changes in equity interests as a result of the Acquisition;

• (g) all other approvals, permits, licences, consents, acknowledgements, etc. required to be obtained from the Approval Authority for the transactions contemplated in the Agreement having been obtained;

• (h) registration of the changes in equity interests as a result of the Acquisition with the State Administration for Industry and Commerce or the relevant local branch thereof and the issuance of a new business licence of JV Co having been completed; and

• (i) the Purchaser having obtained a PRC legal opinion on the capacity of the Vendor to enter into the Agreement as well as the legality, validity and enforceability of the Agreement and the sale of the Sales Interests in form and substance to its satisfaction.

Completion

Completion shall take place at or before 4:00 p.m. (Hong Kong time) on the 3rd Business Day after the conditions precedent stipulated have been fulfilled (or waived, where appropriate) or at such later date and/or a time as the Purchaser and the Vendor may agree.

– 14 –

LETTER FROM THE BOARD

INFORMATION ABOUT THE VENDOR

The Vendor is a limited liability company established under the laws of the PRC. Other than being a holding company in respect of the 35% equity interests in the registered capital of the JV Co, the Vendor does not have any other business.

The Vendor did not have any interest in the share capital of the Company prior to the Completion and will upon the issue and allotment of the Consideration Shares on Completion, be interested in 3% of the share capital of the Company.

REASONS FOR AND BENEFITS EXPECTED TO ACCRUE TO THE COMPANY AS A RESULT OF THE ACQUISITION

As completion of the Former Acquisition has taken place on 25 May 2007 whereby the JV Co has become a subsidiary of the Company, the Directors are of the view that the Acquisition will only further strengthen the Company’s property development business activity which is one of its core businesses and has contributed significantly to the Company’s net profit and forms a major part of the Company’s total assets. The Directors believe that further investment in property development is in the interest and benefit of the Company and the Shareholders.

The Project comprising, among other things, the development of residential and commercial units is located in Central District and Yiyang Hi-tech Development Zone of Yiyang City, Hunan Province（湖南省益陽市中心城區及益陽高新技術產業開發區）. Yiyang City（益陽市）is one of the designated cities in the “three plus five metropolitans development plan” （3+5城市群計 劃） which is a major strategic initiative announced by Hunan provincial government in 2006 to promote and invest in the economic and infrastructural developments of the 8 core metropolitan city centers in the province. With growing economic activities, the Changchang Expressway（長常 高速公路）provides efficient linkage between Yiyang City and Changsha City（長沙市）, the capital city of Hunan province which is 68 km from Yiyang City and is the major transportation hub of central mainland for air, road and water travel.

The Project will be developed to a premium residential and commercial complex to capture not only the (high end) demand from Yiyang City but also that from other parts of Hunan province and other neighbourhoods. The entire Project will be developed along the intimate circumference of Zishanhu（梓山湖）, a sizeable lake of 1,700 Mu with a blended view of blue water and green landscape, including an approximately 2,400 Mu golf course. Under the Park Agreements, the Public Development to be built will also add to the attractiveness and value of the commercial and residential units of the Project.

– 15 –

LETTER FROM THE BOARD

The Park Agreements (together with the Indemnity Undertaking referred to below) allow the Company to acquire 3,000 Mu land for Business Development at a cost of approximately RMB210,000 per Mu (equivalent to approximately RMB315 per sq.m.). The city government also commits to grant under the terms of the Park Agreements exemption and reduction for various construction related tax and levy. Among other incentive payments relating to local tax, the JV Co is entitled to an incentive payment of RMB150 million from the city government out of its local tax revenue received in respect of the Project.

With a large land reserve and a development plan of up to 8 years, the Directors believe that the Project will bring in favourable and sustainable long term profit to the Company.

LISTING RULES IMPLICATIONS OF THE TRANSACTION

As certain of the percentage ratios in respect of the Acquisition is more than 5% but less than 25%, the Acquisition constitutes a discloseable transaction of the Company under the Listing Rules.

The Former Acquisition has been completed on 25 May 2007 and as a result thereof, the JV Co has become a subsidiary of the Company. The JV Co has been accounted for as a subsidiary of the Company and the results of which will be consolidated with the results of the Company for the coming financial year. Given that one of the shareholders of the Vendor is a director of the JV Co holding 50% interests in the registered capital of the Vendor (thereby rendering the Vendor an associate (as defined in the Listing Rules) of the said director), the Acquisition also constitutes a connected transaction for the Company under the Listing Rules. Accordingly, the Acquisition is subject to the reporting, announcement and Independent Shareholders’ approval requirements, by way of poll at a special general meeting, as set out in the relevant provisions of Chapters 14 and 14A of the Listing Rules. As the interests of both KC Ma, a Controlling Shareholder of the Company and KY Ma, a Substantial Shareholder of the Company, are in all respects identical with those of the other Shareholders as a general body, both KC Ma and KY Ma shall be entitled to vote at the relevant shareholders’ meeting. As such, none of the Shareholder is required to abstain from voting at the SGM approving, inter alia, the Acquisition.

An announcement will be made by the Company following conclusion of the SGM to inform Shareholders of the results of the poll vote in respect of the resolutions put to the Independent Shareholders at the SGM.

– 16 –

LETTER FROM THE BOARD

INFORMATION ON THE COMPANY, THE JV CO AND THE PROJECT

The Company was incorporated in Bermuda with limited liability and its Shares are listed on the Main Board of the Stock Exchange. The Group is principally engaged in investment holding, the manufacture, trading and distribution of garments, property investment and development, and the operations of hotel, restaurant and food businesses. Property development is one of the core businesses of the Company and has contributed significantly to the Company’s net profit and formed a major part of the Company’s total assets.

The JV Co is a Sino-foreign equity joint venture enterprise established under the laws of the PRC on 10 October 2005 with a total registered capital of RMB100,000,000. The shareholders of the Vendor and four other shareholders were the joint venture partners of the JV Co at the time of establishment of the JV Co. The Vendor contributed RMB35,000,000 towards the registered capital of the JV Co and owns 35% equity interests in the registered capital of the JV Co. Upon Completion, the Vendor’s interest in the JV Co will be reduced to 15%.

The JV Co has entered into the Park Agreements with The People’s Government of Yiyang City, Hunan Province in relation to the development of the Project, which comprises, mainly, a massive residential and commercial development as well as lake surface operations（梓山湖水面 經營）, theme park operations (being an ecological tourism area developments（生態旅遊區））, citizen square establishment（市民廣場）, etc. The Project is located in the Central District and Yiyang Hi-tech Development Zone, Yiyang City, Hunan Province（湖南省益陽市中心城區及益 陽高新技術產業開發區）which is 68 km from Changsha, the capital city of Hunan province, and neighbours the Changchang Expressway（長常高速公路）connecting Changsha City and Changde City（常德市）.

Under the Park Agreements, the JV Co is entitled to acquire not less than 3,000 Mu (equivalent to approximately 2,000,000 sq.m.) of land at the cost of RMB210,000 per Mu (equivalent to approximately RMB315 per sq.m.). The land cost of RMB210,000 per Mu is the initial asking price payable by the JV Co under the Supplemental Framework Agreement and the Supplemental Cooperation and Development Agreement, the JV Co is responsible to put in investment which is estimated to be around RMB369,000,000 for the development of a citizen square, theme park and lake surface project as part of the Project. Nevertheless, the People’s Government of Yiyang City will in principle compensate the JV Co for an amount of not less than RMB369,000,000 within 5 years from the execution of the Cooperation and Development Agreement subject to the actual investment incurred by the JV Co in relation to the development of a citizen square, theme park and lake surface project.

– 17 –

LETTER FROM THE BOARD

The JV Co has so far paid the consideration for 1,000 Mu (equivalent to approximately 667,000 sq.m.) of land. Out of the 1,000 Mu, JV Co has obtained land use rights certificates for 858 Mu (equivalent to approximately 572,000 sq.m.) and the land use rights certificates for the remaining 142 Mu (equivalent to approximately 95,000 sq.m.) are in the process of being issued by the relevant local government authorities.

The Project with an estimated total investment cost of around RMB3.2 billion will be developed in phases over a period of eight years. On Business Development, construction has started for the first phase of development comprising 100,000 sq.m. gross floor area of residential property, which includes villas, condominiums, duplexes and low-rise apartment buildings, and 30,000 sq.m. gross floor area of commercial property. Presale of the properties has already started in May 2007 and has contributed cash inflow to the Project. As at the Latest Practicable Date, the JV Co has sold such number of units with an aggregate gross floor area of around 52,000 sq.m. in the presale.

On the Public Development front, the development of the citizen square has been completed and opened to the public. The Directors believe that the Public Development will not only add to the commercial value and improve the living environment of the Project, but will also increase publicity of the Project in the Yiyang community as well as in and around the Hunan province.

The entire Project is expected to be fully financed by sales proceeds as well as bank loan facility and share capital. The Company expects that there will be no funding commitment from the Company in relation to the future developments of the Project.

According to the audited accounts of the JV Co prepared according to the Hong Kong Financial Reporting Standards, the net asset value of the JV Co as of 31 December 2006 and 31 December 2005 are RMB103.6 million and RMB95.1 million respectively. Net loss (both before and after taxation) for the year ended 31 December 2006 and the period from 10 October 2005 (date of registration) to 31 December 2005 are RMB6.5 million and RMB4.9 million respectively.

It is expected that immediately upon acquiring the Sales Interests, there will be no change in the net profit (before minority interests) and total liabilities of the Group; whereas the total assets of the Group would be decreased.

– 18 –

LETTER FROM THE BOARD

Notwithstanding the above, to better protect the Company from possible risk exposed to uncertainties involved in the condition-attached public listing, the Company requests and the Vendor agrees to undertake to indemnify the Company for loss arising from (1) failure of the JV Co to acquire any portion of the 2,000 Mu land in the event that the Company actually participated in the public listing; and (2) the JV Co’s cost of acquisition of any portion of the 2,000 Mu land which is higher than RMB210,000 per Mu. The indemnity amount will be capped at RMB86,000,000.

The Park Agreements together with the indemnity provided by KC Ma and KY Ma in the Former Acquisition and the indemnity provided by the Vendor in the Acquisition will safeguard the Company’s acquisition of the remainder of the land for Business Development at the approximate cost of RMB210,000 per Mu or otherwise the Company will be compensated for related loss.

PROCEDURES BY WHICH A POLL MAY BE DEMANDED

A form of proxy for use at the SGM is enclosed herewith. 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 Registrar in Hong Kong, Tengis Limited, at 26/F., Tesbury Centre, 28 Queen’s Road East, 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 SGM.

Pursuant to Bye-law 70, a resolution put to vote of the meeting shall be decided on a show of hands unless a poll is (before or on the declaration of the result of the show of hands or on the withdrawn of any other demand for a poll) demanded by:

• (i) by the Chairman of the meeting; or

• (ii) by 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, or

• (iii) by 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) by any shareholder or shareholders present in person or by a duly authorised 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.

ADDITIONAL INFORMATION

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

Yours faithfully, For and on behalf of the Board Tak Sing Alliance Holdings Limited Ma Kai Cheung Chairman

– 19 –

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

TAK SING ALLIANCE HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code: 126)

18 June 2007

To the Independent Shareholders

Dear Sir or Madam,

DISCLOSEABLE AND CONNECTED TRANSACTION

We refer to the circular issued by the Company to the Shareholders dated 18 June 2007 (the “ Circular ”) of which this letter forms part. Terms defined in the Circular shall have the same meanings when used in this letter unless the context otherwise requires.

We have been appointed as members of the Independent Board Committee to advise you as to whether the terms of the Agreement and the Acquisition are fair and reasonable so far as the Independent Shareholders are concerned. Partners Capital International Limited has also been appointed as the independent financial adviser to advise the Independent Board Committee in respect thereof. Details of Partners Capital International Limited’s advice and recommendation, together with the principal factors and reasons considered in arriving at such advice and recommendation, are contained in its letter set out on pages 21 to 40 of the Circular. We urge you to read that letter carefully.

We wish to draw your attention to the “Letter from the Board” set out on pages 7 to 19 of the Circular which contains, among other things, information of the Agreement and the Acquisition.

Having considered the principal factors and reasons, together with the advice and recommendation mentioned in the letter from Partners Capital International Limited, we consider that the terms of the Agreement and the Acquisition are fair and reasonable so far as the Independent Shareholders are concerned. Accordingly, we recommend the Independent Shareholders to vote in favour of the Agreement and the Acquisition if a Shareholders’ meeting is required to be held.

Yours faithfully,

For and on behalf of the Independent Board Committee

Mr. Lo Ming Chi, Charles Mr. Yau Wing Keung Mr. Lo Man Kit, Sam Independent Non-Executive Director

– 20 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

The following is the text of a letter of advice to the Independent Board Committee and the Independent Shareholders from Partners Capital International Limited dated 18 June 2007 prepared for the purpose of incorporation in this circular:

Partners Capital International Limited Unit 3906, 39/F, COSCO Tower 183 Queen’s Road Central Hong Kong

To the Independent Board Committee and the Independent Shareholders

18 June 2007

Dear Sirs,

DISCLOSEABLE AND CONNECTED TRANSACTION

INTRODUCTION

We refer to our engagement to advise the Independent Board Committee and the Independent Shareholders in respect of the terms of the Agreement, particulars of which are set out in the circular (the “Circular”) dated 18 June 2007, in which this letter is reproduced. Unless the context requires otherwise, capitalised terms used in this letter shall have the same meanings as ascribed to them under the section headed “Definitions” in the Circular.

As set out in the letter from the Board (the “Letter from the Board”), the Company (as purchaser) and 益陽市銀業發工貿有限公司 (Yiyang Yin Ye Fa Industrial and Trading Co., Ltd.) (as the Vendor) entered into the Agreement on 25 May 2007 in relation to the proposed acquisition of the Sales Interests. Since some of the percentage ratios for the Acquisition are 5% or more but less than 25%, and given that one of the shareholders of the Vendor is a director of the JV Co holding 50% interests in the registered capital of the Vendor (thereby rendering the Vendor as an associate (as defined under the Listing Rules) of the said director), the Acquisition constitutes a discloseable and connected transaction for the Company under the Listing Rules. Accordingly, the Acquisition is subject to the reporting, announcement and Independent Shareholders’ approval requirements (by way of a poll at a shareholders’ general meeting).

– 21 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

In formulating our opinion, we have relied on the accuracy of the information and representations contained in the Circular and have assumed that all information and representations made or referred to in the Circular as provided by the Directors were true at the time they were made and continue to be true as at the date of the Circular. We have also relied on our discussion with the Directors regarding the Group and the Agreement including the information and representations contained in the Circular. We have also assumed that all statements of belief, opinion and intention made by the Directors and respectively in the Circular were reasonably made after due enquiry. We consider that we have reviewed sufficient information to reach an informed view, to justify our reliance on the accuracy of the information contained in the Circular and to provide a reasonable basis for our advice. We have no reason to suspect that any material facts have been omitted or withheld from the information contained or opinions expressed in the Circular nor to doubt the truth, accuracy and completeness of the information and representations provided to us by the Directors. We have not, however, conducted an independent in-depth investigation into the business and affairs of the Group, the Sales Interests, the Vendor and its associates, nor have we carried out any independent verification of the information supplied to us.

PRINCIPAL FACTORS CONSIDERED FOR THE AGREEMENT

In arriving at our recommendation in respect of the terms of the Agreement, we have considered the following principal factors:

1. Background of, and reasons for, the Acquisition

As set out in the Letter from the Board, the Group is principally engaged in investment holding, the manufacture, trading and distribution of garments, property investment and development, and the operations of hotel, restaurant and food businesses.

As detailed in the announcement and the circular of the Company dated 8 February 2007 and 30 March 2007 respectively, the Company entered into a sale and purchase agreement dated 8 February 2007 with KC Ma and KY Ma in relation to the acquisition of an aggregate of 55% equity interests in the JV Co. The Former Acquisition has been completed on 25 May 2007 and the Company is currently holding 55% equity interests in the JV Co as subsidiary. The Vendor currently owns 35% interest in the JV Co. Upon Completion, the Company and the Vendor will respectively own 75% and 15% equity interests in the JV Co.

– 22 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

The Project owned by the JV Co comprises a large land reserve for long term commercial and residential development up to eight years. Although Yiyang City belongs to third-tier city in the PRC at present, we understand from the JV Co that the competitive advantages of the Project are vested with:

• (i) the unique and premier geographical location of the Project, representing a lakeside environment to be built along the intimate circumference of Zishanhu, a sizeable lake with a blended and natural scenic view of blue water and green landscape including a golf course and which is in the Central District of Yiyang City. In turn, Yiyang City is only about one hours’ driving distance (via Changchang Expressway) from Changsha, which is the capital city of Hunan Province and the major transportation hub of central mainland for air, road and water travel. Yiyang City is one of the designated cities in the “three plus five metropolitans development plan”（3+5城市群計劃）which is a major strategic initiative announced by Hunan provincial government in 2006 to promote and invest in the economic and infrastructural developments of the 8 core metropolitan city centers in Hunan province. Yiyang City is also renowned as “小有色金屬之鄉 ” (Small town/origin of non-ferrous metal);

• (ii) the large land reserve for development over a ling time horizon of up to eight years; and

• (iii) the Park Agreements signed by the JV Co and the Yiyang City government provide favourable terms for the commercial and residential development such as preferential tax treatments.

We also note that the development of the Project has been progressing in a satisfactory manner. As mentioned in the Letter from the Board, the JV Co has started construction of the first phase of development comprising 100,000 sq.m. gross floor area of residential property which includes villas, condominiums, duplexes and low-rise apartment buildings and 30,000 sq.m. gross floor area of commercial property. Presale of the residential properties has already started in May 2007. We have been advised by the Directors that up to 12 June 2007, units with gross floor area of around 52,000 sq.m. have been sold. The development of the citizen square has been completed and opened to the public.

– 23 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

As set out in the Letter from the Board, the Park Agreements (together with and subject to the Indemnity Undertaking which is capped at RMB86 million plus another similar indemnity undertaking which is capped at RMB216 million under the Former Acquisition) allow the Company to acquire 3,000 Mu of land for Business Development at a target cost of approximately RMB210,000 per Mu (approximately RMB315 per sq.m.). At the same time, the JV Co is responsible to put in a total of RMB369,000,000 for the Public Development, but the city government will compensate the JV Co for its investments incurred in the Public Development for not less than RMB369,000,000 within 5 years of execution of the Cooperation and Development Agreement. Upon review of the Parks Agreements, we note that the said additional development costs of RMB369,000,000 approximates the sum of (i) investment of the Public Development at around RMB300 million; (ii) the resettlement costs for (a) the 404 Mu administrative land at RMB35,956,000 and (b) for the ecological tourist area at RMB25,550,000; and (iii) the resettlement charge for the lake surface at RMB8 million. In this connection, we are advised by the Company that the investment costs of the Public Development to be incurred by the JV Co shall not only be reimbursable by the city government, but also serve to add commercial value to the Project by improving the living environment of the Project, as well as increasing publicity of the Project in the Yiyang community as well as in and around Hunan province.

Based on market comparable data as circulated by the Valuer, we note that the aforesaid target land cost of RMB210,000 per Mu as allowed under the Park Agreements (together with the Indemnity Undertaking and even after accounting for the interest expenses forgone arising from the JV Co’s investments incurred in the Public Development before its reimbursement by the city government in arrears) as and to be procured under the Project is compared favourably with the actual market land prices transacted in the Yiyang City at a range of approximately RMB364,600 to RMB746,400 per Mu in recent years.

– 24 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

As far as the property market in Yiyang City is concerned, we note that, according to 益陽統計信息網 (www.iytj.gov.cn), the property market price index increased by approximately 5% for 2006, with the market price of low-rise apartment buildings（小高 層）reaching around RMB1,500 to RMB1,600 per sq.m., doubling that recorded several years ago. As an indicator of overall economic health which influences largely on property market, we note that the annual GDP growth rate of Yiyang City has been sustaining at high levels in recent years, which is illustrated in the table below together with other demographic data:

	2002	2003	2004	2005	2006
GDP Growth Rate
(%)	8.5%	9.4%	11.0%	11.0%	12.0%
Nominal GDP
(RMB million)	22,967	23,987	28,733	32,920	33,619
Annual disposal
income per capita
(RMB)	6,804	7,424	8,291	8,250	9,138
Population					4.6 million
Area_(square miles)_			12,144

Source: 益陽統計信息網 (http://www.iytj.gov.cn)

According to the Park Agreements, the city government also commits to grant exemption and reduction for various construction related tax and levy. Among other incentive payments relating to local tax, the JV Co is also entitled to an incentive payment of RMB150 million from the city government out of the local tax revenue in respect of the Project. Even without accounting for such incentive payments, we are confirmed by the Company and the Valuer that the capital value of the first phase of the Project when completed (based on prevailing market price) still exceeds the total development costs (including land costs, construction costs and finance costs) of the first phase of the Project.

– 25 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

Based on the existing business plan as circulated by the JV Co, we summarise the particulars of the Project as follows:

								Total				Estimated
						Gross floor		development	Outstanding			capital
	Pre-sale	Completion				area planned		cost		cost to		value when
Location	date	date	Site area		Plot ratio	for sale/lease		expended	completion			completed
	(expected)	(expected)	(sq.m.)		(times)	(sq.m)		(RMB)		(RMB)		(RMB)
				First	phase only
Central District and	mid 2007	end of 2007	about 136,800	sq.m.	1.0 (for Business	(1) around		73,900,000	147,700,000			391,000,000
Yiyang Hi-tech					Development		100,000 sq.m.	(inclusive		as at
Development Zone,					zone only)		for residential use	of land	30 April 2007
Yiyang City,						(2) around		costs paid of
Hunan Province							30,000 sq.m.	25,600,000)
							for commercial	up to
							use	30 April 2007
				All phases
	mid 2007	2015	2,000,000		1.0 to 3.0 (for	2,600,000		200,200,000	2,999,800,000		7,800,000,000
					Business	(Note)		(inclusive of land		as at		(assuming
					Development			costs paid of	30 April 2007		target average
					zone only)			151,900,000)	(Note 1)			selling price
							up to 30 April 2007				of RMB3,000
								(Note 1)				per sq.m.
												(Note 2)
											and assuming
											total saleable
												gross floor
												area of
												2,600,000
											sq.m.)(Note 1)

• Note: 1. Phases other than the first phase have not yet been in the process of being developed. In any event, for the 2,000 Mu of land to be procured under other phases of the Project, we note that the target land cost of RMB210,000 per Mu (being the initial asking public listing price per Mu, which shall be subject to the final public listing price to be concluded in the condition-attached public listing（帶項目掛牌）and any excess over which will be indemnified by the Vendor pursuant to the Indemnity Undertaking subject to a cap of RMB86 million (to be further discussed in the ensuing sections headed “Consideration” and “Risk Factors”)) compared favourably with the actual market land prices transacted in Yiyang City in recent years.

• Target average selling price of RMB3,000 per sq.m. is assumed after accounting for (i) the actual level of transacted prices so far sold for residential units of the first phase of the Project; (ii) the unique and premier geographical location of the Project; (iii) the mixture of villas, condominiums, duplexes and low-rise apartment buildings to be developed and sold; and (iv) the development over a long time horizon of up to eight years under the Project.

– 26 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

Against all the background as stated above, in particular that the Company has completed the Former Acquisition and hence is already in a position to control and oversee the financial and operational affairs of the JV Co by way of dedicating substantial resources (including management and financial), we agree that the Acquisition is a natural step forward for the Group to further capture the long-term growth potential of the developing property market in the PRC, which may be partly demonstrated by the recent positive development of the Project subsequent to the announcement of Former Acquisition back in February 2007. We further note that property development (for which purpose the Acquisition is pursuing) is one of the core businesses of the Company, which has contributed significantly to the Company’s net profit and forms a major part of the Company’s total assets. Although the Group’s property business in the PRC has historically been limited to geographical presence in Guangdong Province, we note that the Group has business experience in other parts of the PRC including Wuhan, Hainan and Shanghai, Sichuan, Beijing, Yunnan, etc. (in terms of hotel/restaurant operation).

2. Key terms of the Agreement

(a) Consideration

As set out in the Letter from the Board, the consideration for the Acquisition of the Sales Interests is RMB167,000,000, which will be satisfied as to RMB83,500,000 by cash and RMB83,500,000 by the issue of 30,476,677 Consideration Shares.

The consideration for the Acquisition has been determined after arm’s length negotiations between the Company and the Vendor by reference to (i) the valuation as at 31 December 2006 as prepared for the Former Acquisition and (ii) the latest development of the Project. Pursuant to the circular issued by the Company on 30 March 2007 (the “Former Circular”), the valuation of the 55% interests in the JV Co under the Former Acquisition (the “Former Interests”) was RMB556.6 million.

Upon review, we note that the valuation of the Former Interests as at 31 December 2006 was prepared by the Valuer by means of market approach. We have discussed with the Valuer on the valuation approach and understand that adopting an income approach would otherwise be inapplicable for valuing the Former Interests which mostly represent properties under development and are asset-based in nature. Instead, the Valuer advises that the land use rights already obtained underlying the Former Interests have been valued on market comparison basis, whereas the contractual rights for land use grant entitled to be obtained under the Park Agreements (approximately 1,334,000 sq.m.) have been valued by way of the difference between the market value of additional lots of lands and the initial asking public listing price per Mu.

– 27 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

We understand that the nature of the assets of the Former Interests comprises (i) non-current assets (such as the land use rights obtained (approximately 572,000 sq.m.), the land use rights under application (approximately 95,000 sq.m.) and the contractual rights for land use grant entitled to be obtained under the Park Agreements (approximately 1,334,000 sq.m.) and (ii) current assets (such as cash). Upon comparison, the consideration for the Acquisition would represent approximately 17.5% discount to the implied value of the Sales Interests of RMB202.4 million (which in turn is the valuation of Former Interests of RMB556.6 million x 20% / 55%). Although such discount is lower than that of 25% applicable for the Former Acquisition, we note that the vendors for the Former Acquisition as announced back in February 2007 were a Controlling Shareholder and a Substantial Shareholder (and were hence willing to accept a deeper size of discount because their personal interests are comparatively more in line with that of the Company due to their prevailing personal shareholding interests in the Company), whereas the Vendor for the Acquisition this time is (to the Directors’ best knowledge) beneficially owned by local PRC residents who were independent third parties having no association with the Company prior to the Former Acquisition. From the sole perspective of such discount, and after taking into consideration the latest positive development of the Project subsequent to 31 December 2006 (as elaborated in the above section), we are of the view that the Consideration is acceptable subject to the risk factor concerning the Indemnity Undertaking to be discussed in the ensuing section and without accounting for any taxation that may be arisen from revaluation surplus of an aggregate of eight pieces of land of the JV Co (the “Owned Lands”) and the contractual rights for land use grant as disclosed in the Former Circular.

– 28 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

(b) Issue price of the Consideration Shares

For the purpose of assessing the Issue Price level of the Consideration Shares, we plot the closing price level of the Shares traded on the Stock Exchange from 1 February 2006 to 23 May 2007 (being the Last Trading Day) and further up to the Latest Practicable Date (the “Review Period”) as follows:

==> picture [103 x 9] intentionally omitted <==

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

Share price performance
----- End of picture text -----

==> picture [312 x 208] intentionally omitted <==

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

HK$
4.5
4.0 Issue Price of
HK$2.8 per Share
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0
1-Feb-06 1-Apr-06 1-Jun-06 1-Aug-06 1-Oct-06 1-Dec-06 1-Feb-07 1-Apr-07 1-Jun-07
----- End of picture text -----

Source: Infocast

During the Review Period, we note that the Shares were traded on the Stock Exchange within a range of a high of HK$3.84 on 28 May 2007 to a low of HK$0.32 on 1 February 2006. In essence, the Issue Price of HK$2.80 per Share represents:

• (i) a discount of approximately 6.0% to the closing price of the Shares of HK$2.98 per Share on the Last Trading Day;

• (ii) a premium of approximately 1.8% to the average closing price of approximately HK$2.75 per Share for the last 5 consecutive trading days up to and including the Last Trading Day;

• (iii) a premium of approximately 10.2% to the average closing price of approximately HK$2.54 per Share for the last 10 consecutive trading days up to and including the Last Trading Day;

– 29 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

• (iv) a premium of approximately 10.7% to the average closing price of approximately HK$2.53 per Share for the last 30 consecutive trading days up to and including the Last Trading Day;

• (v) a premium of approximately 56.4% to the latest published net asset value of approximately HK$1.79 per Share as of 30 September 2006 as set out in the interim report of the Company dated 15 December 2006; and

• (vi) a discount of approximately 20% to the closing price of HK$3.50 per Share as quoted on the Stock Exchange on the Latest Practicable Date.

Based solely on the discount of the Issue Price to the closing price per Share on the Last Trading Day, we consider that the Issue Price is not entirely attractive. However, on a broader perspective, taking into an overall account of:

• (i) the noticeable premium ranging from 1.8% to 10.7% of the Issue Price over the closing price per Share over a wider time spectrum as listed above (being the last 5, 10 and 30 consecutive trading days up to and including the Last Trading Day);

• (ii) the substantial premium of 56.4% of the Issue Price over the latest published net asset value per Share;

• (iii) the sizeable volume of the Consideration Shares to be issued under the Agreement (representing approximately 3.1% of the issued share capital of the Company as at the date of the Agreement and approximately 3.0% of the enlarged issued share capital of the Company after the issue of the Consideration Shares upon Completion);

• (iv) the mild liquidity of Shares recorded during the Review Period with daily turnover of about 4.2 million Shares, representing about 0.4% of a total of 979,345,651 Shares in issue as at the date of the Agreement; and

• (v) the reduction in the net current assets of the Group from approximately HK$101 million as at 31 March 2006 to HK$16 million as at 30 September 2006,

it is considered that the Issue Price is, on balance, acceptable so far as the Independent Shareholders are concerned.

– 30 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

3. Financial effect on the Group

(a) Cashflow/Liquidity

• Impact from the mode of settlement

We envisage that satisfying 50% portion of the Consideration by way of the issue of new Consideration Shares (as to RMB83,500,000 out of a total of RMB167,000,000) has the benefit of preserving the cash resources of the Group (despite the negative impact of shareholding dilution which is to be analysed in the ensuing section). However, as to RMB83,500,000 representing the 50% balance of the total Consideration is still required to be payable in cash in the following manner:

• (i) as to the first tranche of RMB16,700,000 within 30 days of Completion;

• (ii) as to the second tranche of RMB33,400,000 on or before the date falling on the expiry of six months after Completion; and

• (iii) as to the third tranche of RMB33,400,000 on or before the date falling on the expiry of 12 months after Completion.

We upon enquiry have been advised by the Directors that, taking into account of the Group’s prevailing cash balance and the Group’s banking facilities as estimated to be available or unutilised from time to time, the Group should have sufficient working capital to meet its settlement of the consideration for both the Acquisition and the Former Acquisition.

– 31 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

• Impact from the funding requirement of the Project

We reckon that property development business is capital intensive in nature, especially regarding the Project owned by the JV Co which comprises a large land reserve for long term development up to eight years. Given that the Project has an estimated total investment cost of around RMB3.2 billion, we understood from the Directors that the entire Project is expected to be fully financed by sales proceeds as well as bank loan facility and share capital of the JV Co. According to information set out in Appendice I and III to the Former Circular, we summarise the capital commitment and contingent liabilities of the JV Co and the Group as follows:

	The JV Co	The Group
	(Note 1)	(Note 2)
	RMB	HK$
Capital commitment	60,449,000	9,434,000
	(Note 3)
Contingent liabilities	0	68,316,691

Notes:

1. Audited figures as at 31 December 2006.

2. Unaudited figures as at 30 September 2006.

3. Representing commitment contracted but not provided for properties under development, which included the construction of the Public Development at the JV Co’s own costs

Despite the sizeable sum of estimated total investment of the JV Co, we upon enquiry have been advised by the Directors that no funding commitment on the part of the Company is expected to arise upon or after Completion for supporting the future development of the JV Co or the Project. Upon further enquiry, the Directors confirm to us that the JV Co or the Project can basically be self-sustained in securing its own financial resources for future development according to its existing business plan. As advised by the JV Co, there were banking facilities of approximately RMB100 million available to the JV Co, (of which RMB62 million was not used up as at 31 December 2006); and presale of the first phase of the Project has already started as scheduled in May 2007 and has contributed cash inflow to the Project.

– 32 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

(b) Net assets and net asset value per Share

Based on the information set out in Appendix IV to the Former Circular, and as advised by the Directors, the Adjusted unaudited consolidated net assets of the Group immediately upon the Acquisition is expected as follows:

		Per Share
	HK$ million	HK$
Unaudited consolidated net	2,029.6	2.07
assets of the		(Note 1)
Group before Completion
Adjusted unaudited consolidated net	1,977.6	1.96
assets of the Group		(Note 2)
immediately upon Completion

1. Based on 979,345,651 Shares in issue as at the date of the Latest Practicable Date

2. Based on 1,009,822,328 Shares as enlarged after the issue of the Consideration Shares upon Completion

As illustrated in the above table, the consolidated net assets of the Group are expected to reduce immediately upon Completion. We upon discussion with the Company note that such expected reduction can be attributable to the reduction in such extent of minority interests equivalent to the fair value of the Sale Interests, which however is partially offset by the issue of sizeable volume of new Consideration Shares (of RMB83.5 million (equivalent to HK$85.3 million)) to settle 50% portion of the Consideration. On a tangible basis, the consolidated net tangible assets of the Group are expected to be further reduced by a positive goodwill to be arisen on the Acquisition immediately upon Completion. Such goodwill represents the excess of the Consideration payable over the fair value of Sales Interests, the latter of which in turn would have accounted for taxation arisen from revaluation surplus of the Owned Lands and the contractual rights for land use grant as disclosed in the Former Circular.

As illustrated in the above table, the consolidated net asset value per Share is also expected to reduce immediately upon Completion. We upon discussion with the Company note that such expected reduction can be attributable to the reduction in such extent of minority interests equivalent to the fair value of the Sale Interests, which however is partially offset by the issue of sizeable volume of new Consideration Shares (of RMB83.5 million (equivalent to HK$85.3 million)) at the Issue Price which represents a premium of approximately 56.4% to the latest published net asset value of approximately HK$1.79 per Share as of 30 September 2006 as set out in the interim report of the Company dated 15 December 2006.

– 33 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

(c) Gearing

Based on the information set out in Appendix IV to the Former Circular, and as advised by the Directors, the gearing ratio of the Group before and upon Completion is expected as follows:

	Total liabilities	Net assets	Gearing ratio
	HK$ million	HK$ million	%
Before Completion	1,256.5	2,029.6	61.9
	(Note)
After Completion	1,256.5	1,977.6	63.5
	(Note)

Note: Pro forma adjusted unaudited consolidated figures after accounting for the consolidation of the JV Co upon Completion as set out in Appendix IV to the Former Circular.

As illustrated in the above table, the gearing ratio of the Group is expected to increase immediately upon Completion. We upon discussion with the Company note that such expected increase is attributable to (i) no increase in the total liabilities of the Group upon further acquisition of 20% interests in the JV Co because the JV Co is already the Company’s subsidiary prior to the Acquisition and hence 100% of the existing total liabilities of the JV Co (without apportioning for any attributable share by minority interest) have already been consolidated by the Group; and (ii) the reduction in the consolidated net assets of the Group immediately upon Completion.

(d) Earnings

According to the audited accounts of the JV Co prepared in accordance with the Hong Kong Financial Reporting Standards as set out in Appendix III to the Former Circular, net loss (both before and after taxation) of the JV Co for the year ended 31 December 2006 was approximately RMB6.5 million. We understand from the Directors that the Project was in its early stage of development and, accordingly, no property sales were recognised during the year ended 31 December 2006.

– 34 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

Upon Completion, the Group shall, on a consolidated basis, be entitled to account for the net profits/loss of the JV Co as a 75% owned subsidiary. Assuming that the Acquisition had been completed on 1 January 2006, and taking into account of the net loss of the JV Co for the year ended 31 December 2006 (as property sales were yet to be recognised) which would have impacted the Group given completion of the Former Acquisition had taken place (irrespective of the Acquisition), it is expected that the Acquisition would have (i) a negative effect on the earnings after deducting minority interests of the Group immediately upon Completion and (ii) no effect on the earnings before deducting minority interests of the Group immediately upon Completion. However, the actual impact of the Acquisition on the Group after Completion would largely depend on the progress and the extent of pre-sales and completion of different phases of the Project due to the fact that revenue (and hence profit) from sale of properties and pre-completion contracts for sale of development properties is not recognised until the construction thereof has been completed, the title thereof has been transferred, and relevant properties have been delivered to purchasers according to the accounting policy of the JV Co. As advised by the Directors, completion of the first phase of the Project is targeted by the end of 2007 according to its existing business plan.

4. Dilution effect on shareholding

Upon Completion, the Company will issue an aggregate of 30,476,677 new Consideration Shares to the Vendor, representing approximately 3.1% of the issued share capital of the Company as at the date of the Agreement and approximately 3.0% of the enlarged issued share capital of the Company after the issue of the Consideration Shares upon Completion. The following table sets out the shareholding structure of the Company at present and after issue of the Consideration Shares:

KC Ma KY Ma Public Shareholders – Existing – the Vendor Total	As at the date of the Announcement and the Latest Practicable Date (No. of Shares) % 481,423,197 49.16 144,975,300 14.80 352,947,154 36.04 – – 979,345,651 100.00	Consideration Shares to be issued (No. of Shares) % – – – – – – 30,476,677 100.00 30,476,677 100.00	After issue of the Consideration Shares (No. of Shares) % 481,423,197 47.67 144,975,300 14.36 352,947,154 34.95 30,476,677 3.02 1,009,822,328 100.00	After issue of the Consideration Shares (No. of Shares) % 481,423,197 47.67 144,975,300 14.36 352,947,154 34.95 30,476,677 3.02 1,009,822,328 100.00
				100.00

– 35 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

As illustrated in the above table, the aggregate interests of the existing public Shareholders in the Company will be diluted from approximately 36.04% to approximately 34.95% (excluding the Vendor) immediately upon Completion. Given the insignificant magnitude of such reduction , and in light of an acceptable ground for pursing the Acquisition by the Group (namely, a natural step forward for the Group to further capture the long-term growth potential of the developing property market in the PRC which may be partly demonstrated by the recent positive development of the Project subsequent to the announcement of Former Acquisition back in February 2007), and taking into further account of the benefit of preserving the cash resources of the Group in satisfying 50% of the Consideration by way of the issue of new Shares at the Issue Price which represents a substantial premium of 56.4% over the latest published net asset value per Share, we consider that the dilution effect on the public Shareholders is understandable.

5. Risk factors relating to the Acquisition

In assessing the terms and the merits of the Agreement, we note that the Acquisition is associated with certain risk factors, which should however be commonly found to prevail in property development industry in emerging markets. Attention of the Independent Shareholders is drawn to balance these risk factors against the potential benefits expected to accrue from the Acquisition, which is to capture the growth potential of the property market in the PRC. Given that property development in the PRC has been one of the core businesses of the Company, and given that the Company has completed the Former Acquisition, most of the risk factors to be discussed below should be in line with the ongoing risk exposure of the Company and the risk profile of Shareholders:

(a) Legal risks

(i) Indemnity Undertaking subject to a cap of RMB86 million

To better protect the Company from possible risk exposed to uncertainties involved in the condition-attached public listing, the Vendor shall (as one of the condition precedents to Completion) issue a deed of indemnity to indemnify the Company for losses of up to RMB86 million in the event that (1) the JV Co participates in the acquisition process but fails to acquire any portion of the 2,000 Mu of land; and/or (2) the JV Co’s cost of acquisition of any portion of the 2,000 Mu of land is higher than RMB210,000 per Mu, by way of public listing in accordance with the terms of the Park Agreement and the contents of such deed shall be acceptable to the Company.

– 36 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

Upon enquiry, we understand that the cap of RMB86 million was derived on the basis of, and equivalent to, such portion of the Consideration as attributable to the valuation of contractual rights for land use grant held by the JV Co. If the JV Co fails to acquire any portion of the 2,000 Mu of land and accordingly the cap of RMB86 million of the Indemnity Undertaking is fully triggered, the Company should be refunded with such attributable portion of the Consideration (which essentially represents approximately 17.5% discount to the valuation of the contractual rights for land use grant held by the JV Co). Under such circumstance, the Company would no longer be able to capture the growth potential of the 2,000 Mu of land in addition to the Owned Lands in Yiyang City, thereby losing the time cost and opportunity cost of such portion of Consideration paid upfront, and at the same time exposing to the risk of downward revaluation of the Owned Lands as a result of failing to capture a full-scale development potential for the whole of 3,000 Mu of land under the Park Agreements.

In any event, we are advised by the Directors that the possible risk exposed to uncertainties involved in the condition-attached public listing (and hence the ultimate trigger of the Indemnity Undertaking) may not be high because (i) Zishanhu development comprises commercial developments（經營 性項目）and public developments（公益性項目）; (ii) the carrying out of the public developments is a condition and pre-requisite to undertake the commercial developments; (iii) to be qualified for participating in the condition-attached public listing regarding Zishanhu commercial and residential development, the relevant party needs to demonstrate its ability and resources to complete the commercial developments and public developments collectively; (iv) The Land and Resources Bureau of Yiyang City has acknowledged that the JV Co has the ability and resources to complete the commercial developments and public developments at Zishanhu collectively; and (v) the JV Co has secured the first 1,000 Mu of land for Business Development and has commenced construction of the Public Development.

– 37 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

(ii) Land appreciation tax

The Group is obliged to pay Land Appreciation Tax which is levied upon the revenue received from the sales and transfer of properties. On 28 December 2006, the State Administration of Taxation issued the Notice in Relation to the Settlement of Land Appreciation Tax levied on Real Estate Development Enterprises, which became effective on 1 February 2007. The notice sets forth, among other things, methods of calculating LAT and a time frame for settlement. No provisions nor payments for LAT have ever been made by the JV Co for the two years ended 31 December 2006 (although provisions for LAT (plus other deferred taxations) are to be made upon Completion for the Group according to the accounting policy of the proforma statement). Subject to the actual LAT amounts to be assessed by the government in the future, the cash flows and the profitability of the JV Co could be materially adversely affected.

(iii) Land use rights

The JV Co has so far paid consideration for 1,000 Mu (approximately 667,000 sq.m.) of land. However, the land use right grant contracts in respect of land site of 2,000 Mu (approximately 1,334,000 sq.m.) had not been secured by the JV Co up to the Latest Practicable Date, let alone the land costs payable for obtaining the relevant land use right certificates. The actual payment of the land premium when due may cause a cash flow strain on the JV Co if internal or external financing is not available to fund the payment.

(iv) Undeveloped land

According to the “Notice Concerning the Opinion on Adjusting the Housing Supply Structure and Stabilizing the Housing Price” jointly issued by the relevant PRC Ministries and regulators in April 2005:

• (1) Land idle fee shall be imposed on land that has not been developed for one year from the contractual construction commencement date. Projects should be commenced and completed strictly on time.

• (2) The land use right of land that has not been developed for two years will be withdrawn without compensation.

– 38 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

• (3) If the area developed and constructed is less than 1/3 or the amount invested is less than 1/4, the land shall be deemed to be idle, even if the project commences construction in accordance with the contractual construction commencement date.

If the JV Co is in breach of the requirements of such Notice (including phases further to phase one of the Project), then the JV Co may be subject to the penalty of said land idle fee or the withdrawal of land use right.

(b) Business risks

(i) Availability of funding on construction

The Project is currently either in the early stages of development or has not yet commenced development for its later phases. In the event that the JV Co could not generate or obtain internal or external funding for the construction works to continue or to commence, the Project may not be completed on time and hence the development progress and the contribution potential of the Project may be jeopardised.

(ii) Construction risks

In practice, the time taken and the cost incurred in completing the construction of the Project can be adversely affected by many factors including but not limited to shortages of materials, equipment, labour disputes, accidents, acts of God, and changes of government policies, etc.. Any of these factors would give rise to delays in the completion of the property developments which may result in additional costs to be incurred by the JV Co and affect the cash flow thereof.

(iii) Selling price

The actual selling prices of the Project depend on a number of factors, amongst others, the overall markets sentiment, the GDP per capita of Yiyang City, the affordability of buyers, the demand, supply, proximity and quality of similar and competing types of properties in the market and the government policy at that time when the properties are put to the market for sale or presale. In the event that the actual selling prices of the properties are materially lower than the estimated selling prices, the cash flows and the profitability of the JV Co may be affected.

– 39 –

LETTER FROM PARTNERS CAPITAL INTERNATIONAL LIMITED

• (iv) Supply

A number of competing developers have committed substantial resources to property development in Yiyang City, Hunan Province, the PRC. It is anticipated that the supply for residential units, office premises and shopping arcades will be growing in Yiyang City. In the event that the supply of such properties does not match with the anticipated demand, there will be an oversupply in the market and the selling prices will therefore be affected, which, in turn, will affect the cash flows and the profitability of the JV Co.

RECOMMENDATION

Having considered the above principal factors, in particular,

• (i) the reasons for the Acquisition, which is a natural step forward for the Group to further capture the long-term growth potential of the developing property market in the PRC which may be partly demonstrated by the recent positive development of the Project subsequent to the announcement of Former Acquisition back in February 2007, and which is in line with the core businesses of the Company;

• (ii) the key terms of the Agreement (being the Consideration and the Issue Price);

• (iii) the financial effects of the Acquisition on the Group, such as the negative impacts on the net asset value per Share and the gearing position of the Group, which are however to be balanced with the contribution potential of the Project subject to the progress and the extent of pre-sales and completion of different phases of the Project; and

• (iv) the risk factors associated with the Acquisition, most of which are however in line with the ongoing risk exposure of the Company and the risk profile of Shareholders, especially after completion of the Former Acquisition by the Company on 27 May 2007;

we consider that the terms of the Agreement are fair and reasonable so far as the Independent Shareholders are concerned and are in the interests of the Company and the Shareholders as a whole. We also consider that the Acquisition is structured on normal commercial terms and is in the ordinary and usual course of business of the Company. Accordingly, we recommend the Independent Board Committee to advise the Independent Shareholders to vote in favour of the resolutions to approve the Agreement in the SGM.

Yours faithfully, For and on behalf of

Partners Capital International Limited Alan Fung Harry Yu Managing Director Executive Director

– 40 –

VALUATION REPORT

APPENDIX I

==> picture [135 x 74] intentionally omitted <==

==> picture [68 x 68] intentionally omitted <==

18 June 2007

The Directors Tak Sing Alliance Holdings Limited 26th Floor Wyler Centre Phase II No. 200 Tai Lin Pai Road Kwai Chung New Territories Hong Kong

Dear Sirs,

In accordance with your instructions for us to value the property interests held by Carrianna (Hunan) Enterprise Co. Ltd. (“Carrianna (Hunan)”) in the People’s Republic of China (“the PRC’’), we confirm that we have carried out inspections, made relevant enquiries and obtained such further information as we consider necessary for the purpose of providing you with our opinion of the market value of such property interests as at 30 April 2007 (“the date of valuation”) for the purpose of incorporation in the circular.

Our valuation is our opinion of the market value of the property interest which we would define as intended to mean “the estimated amount for which a property should exchange on the date of valuation between a willing buyer and a willing seller in an arm’s-length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion’’.

In valuing the property interests, which are held or contracted to be acquired by Carrianna (Hunan) for development, we have valued them on the basis that the property will be developed and completed in accordance with the information provided to us. We have assumed that approvals for development proposals will be obtained without undue time delay. In arriving at our opinion of value, we have adopted the direct comparison approach by making reference to comparable sales evidences as available in the relevant market and have also taken into account the development costs expended and the costs that will be expended to complete the development.

– 41 –

VALUATION REPORT

APPENDIX I

Our valuation has been made on the assumption that the owners sell the property interests on the market without the benefit of deferred term contracts, leasebacks, joint ventures, management agreements or any similar arrangements which would serve to increase the value of the property interests. In addition, no forced sale situation in any manner is assumed in our valuation. The valuation represents the value of the entire property interests described in the valuation certificate and not the value of a share of them.

We have not caused title searches to be made for the property interests at the relevant government bureau in the PRC. We have been provided with certain extracts of title documents relating to the property interests. However, we have not scrutinized the original documents to verify the ownership, encumbrances or the existence of any subsequent amendments which may not appear on the copies handed to us. In undertaking our valuation for the property interests, we have relied on the legal opinion (“the PRC Legal Opinion”) on 30 March 2007 provided by the instructing party’s (“the Company”) PRC legal adviser, King & Wood.

We have relied to a considerable extent on the information provided by the Company and have accepted advice given to us on such matters as planning approvals, statutory notices, easements, tenure, occupation, lettings, site and floor areas, development plans, construction costs, identification of the properties and other relevant matters. We have also been advised by the Company that no material facts had been concealed or omitted in the information provided to us. All documents have been used for reference only.

All dimensions, measurements and areas included in the valuation certificate are based on information contained in the documents provided to us by the Company and are approximations only. No on-site measurement has been taken.

We have carried out inspection on the properties. However, no structural survey has been made and we are therefore unable to report whether the properties are free from rot, infestation or any other structural defects. No tests were carried out on any of the services.

We have not carried out investigations on site to determine the suitability of ground conditions and services etc. for any future development, nor have we undertaken any ecological or environmental surveys. Our valuation is prepared on the assumption that these aspects are satisfactory and that no extraordinary expenses or delays will be incurred during construction period.

No allowance has been made in our valuation for any charges, mortgages or amounts owing on the property interests nor for any expenses or taxation which may be incurred in effecting a sale. Unless otherwise stated, it is assumed that the property interests are free from encumbrances, restrictions and outgoings of an onerous nature which could affect their values.

– 42 –

VALUATION REPORT

APPENDIX I

Our valuation is prepared in accordance with the HKIS Valuation Standards on Properties (First Edition 2005) published by the Hong Kong Institute of Surveyors (HKIS).

We enclosed herewith the valuation certificate.

Yours faithfully, For and on behalf of

Vigers Appraisal & Consulting Limited

Raymond Ho Kai Kwong

Registered Professional Surveyor MRICS MHKIS MSc(e-com) Executive Director

Note:

Raymond K. K. Ho, Chartered Surveyor, MRICS, MHKIS, has over nineteen years’ experience in undertaking valuations of properties in Hong Kong and Macau, and has over twelve years’ experience in valuations of properties in the PRC. Mr. Ho has been working with Vigers Group since 1989.

– 43 –

VALUATION REPORT

APPENDIX I

VALUATION CERTIFICATE

Property interests held or contracted to be acquired by Carrianna (Hunan) Enterprise Company Ltd

Property

Description and Tenure

Particulars of occupancy

Capital Value in existing state as at 30 April 2007

Various parcels of land bounded by Yiyang Road to the north, Tuanyuan Road to the east and Yingbin Road to the south, Yiyang City, Hunan Province, The PRC

The property comprises land lots having a total site area of approximately 667,735.42 sq.m., of which an area of 572,330.34 sq.m. has been granted with land use rights certificates. (see also footnotes below)

A portion of the property is currently under development and the remaining area is held by or to be granted to Carrianna (Hunan) for future development.

RMB565,000,000

According to the Company, the property is held for development into residential/commercial complexes. The construction of substructure for the first phase comprising gross floor area for residential use of around 100,000 sq.m. and commercial use of around 30,000 sq.m. in a site of about 136,800 sq.m. is in progress. The remaining site area is in the state of design planning.

For the land lots held with land use rights certificates, they have been granted with the land use rights for a term of 70 years for residential use and 40 years for commercial use commencing on 14 April 2006.

– 44 –

VALUATION REPORT

APPENDIX I

Notes:

1. The land has been granted or contracted to be granted as a portion of the sites to be made available to Carrianna (Hunan) Enterprise Co., Ltd for acquisition through public listing under the Framework Agreement on the Development of Zishanhu Theme Park (the “Framework Agreement”) dated 9 October 2005, the Cooperation and Development Agreement of Zishanhu Theme Park dated 16 October 2005 and the supplemental memorandums to them dated 30 March 2007 entered into between the Government of Yiyang City (Party A) and Carrianna (Hunan) Enterprise Co., Ltd. (Party B). According to the agreements, the parties have agreed on the cooperation on the development of the undeveloped portion of Zishanhu Theme Park (the “Theme Park”). Further details are as follows:

District Concerned : Land located to the east, south and north of Zishanhu together with the water surface of the lake. Development Projects : Commercial development together with “Public Development” comprising citizen square, ecological tourism area, lake water surface project and pubic utility facilities.

Provisional Development : Separated in 9 zones as follows: Density

				Building
		Area (in	No. of	Density		**Plot **	Greenery
Zone	Development	hectare)	Storey	(%)	Ratio		Ratio
A	Citizen Square	9.34	–	–		0.2	–
B	Water Surface	115.18	Reserved for water-fun
			entertainment facilities.
C	Ecological Area	132.09	1-3	1		0.05	90
1	Zones 1 to 6 are for	7.78	3-20	25		3.0	35
2	Development	22.10	3-15	25		1.5	40
3	(“the Development	15.52	3-5	25		1.0	40
4	Zone”)	39.16	1-4	25		1.0	45
5		110.05	3-6	25		1.0	45
6		31.42	3-6	25		1.0	45

Total Investment : Public Development not less than RMB300 million. Business Development not less than RMB2.2 billion.

Land Supply Schedule : For the Business Development, 1,000 Mu in the first year; and according to the development progress carried out by Party B, within 5 years for all of the development sites.

– 45 –

APPENDIX I

VALUATION REPORT

Cooperative Clause

: Party B is responsible for the overall development of the theme park and its surrounding areas in accordance with development approvals granted by Party A. Party A will grant the sites having a total area of 3,000 Mu fall within the Development Zones at approximately RMB210,000 per Mu (which being initial asking price and is subject to the final public listing price as concluded) to Party B for Business Development purposes. Party B is entitled to all the profit gained from the Business Development.

The Public Development are to be developed and, when completed, operated by Party B in non-profit making basis and should be open to public free of charge. Subject to relevant laws and regulations or the approval from Party A, Party B may also built and operate commercial projects within the Theme Park.

In addition, Party B may built and operate commercial projects within the citizen square and ecological tourist area having the site areas of respectively 70 Mu and 150 Mu. This additional development should be completed within 3 years.

Costs for Public Provision : The investment on the Public Development should be at around RMB300 million. The resettlement costs comprise a lump sum of RMB35,956,000 payable within two years for the 404 Mu administrative land: RMB25,550,000 payable in three years (at a yearly amount of RMB8,500,000) for the ecological tourism area; and a lump sum resettlement charge at RMB8 million for the lake surface. Based on the input in the investment, construction and operation of the nonprofit-making public utilities in the Zishanhu Park, Party A should compensate an amount to Party B which is to be determined between the both parties. Development Period : Public Development to be completed in 3 years from the date of issuance of the first land use rights certificate for the Business Development and the completion of the resettlement of the citizen square and the ecological tourism area. The citizen square should be practically completed on or before 4 March 2007. Starting from the date of issuance of the first land use rights certificate for the Business Development, land acquisition should be completed in 5 years, developments commenced in 6 years and completed in 8 years. Development Density : Permissible gross floor area should be in accordance with those mentioned in the Framework Agreement. The plot ratio for the individual site may be adjusted for planning amendments.

1. According to a Confirmation on Successful Deal of Listing and the PRC legal opinion, the Company has won in a public listing of the land to acquire the land use rights of the property with a total area of 667,735.42 sq.m. at a total premium of RMB199,280,000. The land is for commercial and residential uses respectively for the terms of 40 years and 70 years.

– 46 –

VALUATION REPORT

APPENDIX I

1. According to 7 State-owned Land Use Rights Certificates Yi Guo Yong (2006) Nos. D00016 to D00018 and D00047 to D00050, the land use rights of the property having a total site area of approximately 572,330.34 sq.m. have been granted to Carrianna (Hunan) Enterprise Co., Ltd. for the terms of 70 years and 40 years commencing on 14 April 2006 respectively for residential and commercial uses. Further details are as follows:

Certificate No. Lot No. D00016 9-06-90 D00017 9-05-153 D00018 9-18-35 D00048 9-67-14 D00049 9-67-15 D00050 9-67-12 D00047 9-67-9	Site Area (in sq.m.) 29,997.44 103,584.37 59,477.86 96,390.53 96,541.40 66,298.95 120,039.79
	572,330.34

1. According to a State-owned Land Use Rights Grant Contract dated 14 March 2007, the land use rights for another land lot having a site area of approximately 94,336.59 sq.m. was agreed to be granted to Carrianna (Hunan) Enterprise Co., Ltd. for commercial and residential uses respectively for year terms of 40 years and 70 years from the date of site delivery at a land premium of RMB17,640,900.

2. According to the Company and the PRC legal opinion, Carrianna (Hunan) has paid in full the land premium of RMB124,800,550 for a land lot area of 666,666.67 sq.m. Carrianna (Hunan) has not yet entered into a State-owned Land Use Rights Grant Contract for a remaining land lot having a site area of approximately 1,068.75 sq.m. contracted to be acquired in the public listing. Carrianna (Hunan) is obliged to enter into the contract according to the Confirmation on Successful Deal of Listing. The outstanding land premium for all the land lots contracted to be acquired is RMB74,498,400. In valuing the property, we have taken into account the outstanding balance of the land premium as at the date of valuation.

3. According to 6 Planning Permits for Construction Land Nos. Yi Gui Yuan Di Zi 20060009, 20060010, 20060012, 20060013, 20060015 and 20060016, the permission for the construction land planning for a total site area of 452,290.55 sq.m. has been granted.

According to Planning Permit for Construction Works No. 2006106, the permission for the construction works planning having a total gross floor area of 135,589 sq.m. for commercial and residential uses has been granted.

According to Permit for Commencement of Works No. 430900200606140101, the permission for the commencement of construction works having a total gross floor area of 135,589 sq.m. for a commercial and residential project has been granted.

According to the Company, Carrianna (Hunan) is in the process of applying for Planning Permit for Construction Land for the parcel of land held under the State-Owned Land Use Rights Certificate No. D00047.

– 47 –

VALUATION REPORT

APPENDIX I

1. The PRC legal opinion further states, inter alia, the follows:

2. i. Carrianna (Hunan) is duly incorporated and legally operated in accordance with the applicable PRC laws and regulations.

3. ii. Carrianna (Hunan) has obtained seven State-Owned Land Use Rights Certificates for the land having a total site area of 572,330.34 sq. m. (approximately 858 Mu). According to the State-Owned Land Use Rights Certificates issued by the Land Bureau, Carrianna (Hunan) is the sole legal owner of the land use rights. Subject to a mortgage on the land use rights in favor of Industrial and Commercial Bank of China Yiyang Branch Taohualun Sub-branch, Carrianna (Hunan) may transfer, lease or mortgage the land use rights in accordance with the applicable PRC laws and regulations.

4. iii. According to the Payment Certificate of Land Premium issued by the Land Bureau on 21 March 2007, Carrianna (Hunan) has paid in full a land premium of RMB124,800,550 in total regarding the land having an area of 666,666.67 sq. m. (approximately 1,000 Mu), of which the State-Owned Land Use Rights Certificate regarding the 142 Mu (approximately 94,667 sq. m.) of land has not been obtained. Given that the StateOwned Land Use Rights Grant Contract regarding the 142 Mu (approximately 94,667 sq.m.) land has been entered into and the land premium under the contract aforementioned has been fully paid up, Carrianna (Hunan) can apply for the State-Owned Land Use Rights Certificate regarding the land having an area of 142 Mu (approximately 94,667 sq. m.). There shall be no legal impediment regarding obtaining such State- Owned Land Use Rights Certificate. Upon receipt of the relevant State-Owned Land Use Rights Certificate, Carrianna (Hunan) can transfer, lease, mortgage and use the land use rights regarding the 142 Mu (approximately 94,667 sq. m.) land in accordance with the applicable PRC laws and regulations.

5. iv. Carrianna (Hunan) has obtained the Permits for Construction Land Planning for six parcels of land (StateOwned Land Use Rights Certificate Nos: D00016, D00017, D00018, D00048, D00049 and D00050). A Permit for Construction Project Planning and a Permit for Construction Commencement have also been issued to Carrianna (Hunan) with respect to its construction on the land lot No.2 (State-Owned Land Use Rights Certificate No.: D00017). Carrianna (Hunan) can legally carry on the construction on the land lot No. 2 according to the permits aforementioned.

6. v. The Framework Agreement (together with its Supplementary Memorandum) and the Cooperation and Development Agreement (together with its Supplementary Memorandum) are legal and valid under the PRC laws and regulations.

7. vi. In accordance with the Cooperation and Development Agreement and its Supplementary Memorandum, Carrianna (Hunan)’s rights in respect of land as stipulated under the Cooperation and Development Agreement and its Supplementary Memorandum are transferable after the Carrianna (Hunan) has obtained the relevant land use rights certificates based on the outcome of which Carrianna (Hunan) has won the public listing of land use rights grant as subject to PRC laws and regulations.

– 48 –

APPENDIX I

VALUATION REPORT

• vii. According to the Cooperation and Development Agreement and its Supplementary Memorandum, the Government of Yiyang City has agreed to compensate Carrianna (Hunan) on the basis of its input in the investment, construction and operation of the non-profit-making public utilities in the Zishanhu Park within 5 years after execution of the Cooperation and Development Agreement and its Supplementary Memorandum. The exact compensation amount will be determined between Carrianna (Hunan) and Government of Yiyang with reference to the actual investment made in such non-profit-making public utilities in the Zishanhu Park, which in principle shall not be less than RMB369 million in total.

• viii. According to the Cooperation and Development Agreement and its Supplementary Memorandum, Government of Yiyang City will arrange for the land use rights grant of all commercial land by means of public listing with commitment on project at an estimated average upset price of RMB210,000 per Mu. The final price for acquiring such land use rights shall be subject to the outcome of the listing.

• According to the Company, the legal shareholders and the share ratio of Carrianna (Hunan) are as follows: Crown Tech Investments Limited (wholly-owned subsidiary of Tak Sing Alliance Holdings Limited) (55%), Ying Shun Investment Company Limited (5%), Mr. Chen Qiang (5%) and Yiyang Yin Ye Fa Industrial and Trading Co. Ltd（益 陽市銀業發工貿有限公司）(35%).

• The total development cost (excluding land cost) expended in the development of the Phase I as at the date of valuation was approximately RMB48,300,000. In the course of our valuation, we have taken such development cost expended into account. The outstanding cost to complete the Phase I development was estimated to be approximately RMB147,700,000. The scheduled date of completion of the development is around the end of 2007.

• The capital value of the Phase I development when completed is approximately RMB391,000,000.

– 49 –

GENERAL INFORMATION

APPENDIX II

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 and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief there are no other facts the omission of which would make any statement herein misleading.

2. DISCLOSURE OF INTERESTS BY DIRECTORS AND CHIEF EXECUTIVE

As at the Latest Practicable Date, the interests and short positions of the Directors and chief executive of the Company in the shares, underlying shares and debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which (a) 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 which (b) were required pursuant to Section 352 of the SFO to be entered in the register referred therein; or which (c) were required to be notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Companies (the “Model Code”) under the Listing Rules, were as follows:

(a) Directors’ Interests in shares of the Company

						Underlying	Underlying		Percentage
		Number of ordinary shares held					shares		of the
		and nature of interest				pursuant to			Company’s
Name of		Personal	Family	Other		share options			issued share
director	Capacity	interests	interests	interests			(note 1)	Total	capital
KC Ma	Beneficial	212,994,172	9,300,000	259,129,025		10,000,000		491,423,197	50.18
	owner,		(note 2)	(note 3)
	interest of
	spouse,
	beneficiary
	of trust
KY Ma	Interest of	41,074,260	2,700,000	101,201,040		10,500,000		155,475,300	15.88
	spouse and		(note 4)	(notes 5&6)
	beneficiary
	of trust
Ng Yan	Beneficial	11,768,000	–		–		–	11,768,000	1.20
Kwong	owner
Yip Hing	Beneficial	3,520,000	–		–		–	3,520,000	0.36
Chung	owner

– 50 –

APPENDIX II

GENERAL INFORMATION

					Underlying		Percentage
		Number of ordinary shares		held	shares		of the
		and nature of interest			pursuant to		Company’s
Name of		Personal	Family	Other	share options		issued share
director	Capacity	interests	interests	interests	(note 1)	Total	capital
Zhang	Beneficial	630,000	–	–	7,300,000	7,930,000	0.81
Huaqiao	owner
Lo Ming	Beneficial	–	–	–	450,000	450,000	0.05
Chi,	owner
Charles
Yau Wing	Beneficial	–	–	–	450,000	450,000	0.05
Keung	owner
Lo Man	Beneficial	–	–	–	150,000	150,000	0.02
Kit, Sam	owner

Notes:

• (1) The underlying Shares represent interests of options granted to the Directors and its associate under the share option scheme to acquire for Shares of the Company.

• (2) The Shares were owned by Cheung Lin Kiu, the spouse of KC Ma.

• (3) KC Ma and his family are the objects of a discretionary trust which effectively owns the entire issued share capital of Regent World Investments Limited (“Regent World”) and 70% of the entire issued share capital of Bond Well Investments Limited (“Bond Well”). At the date of this circular, Regent World owned 184,121,625 Shares and Bond Well owned 75,007,400 Shares of the Company.

• (4) The Shares were owned by Kwok Kit Mei, the spouse of KY Ma.

• (5) KY Ma and his family are the objects of a discretionary trust which effectively owns the entire issued share capital of Grand Wealth Investments Limited (“Grand Wealth”) and Peaceful World Limited (“Peaceful World”). At the date of this circular, Grand Wealth owned 74,651,040 Shares and Peaceful World owned 19,050,000 Shares of the Company.

• (6) Peaceful World owns the entire issued share capital of Real Potential Limited (“Real Potential”). At the date of this circular, Real Potential owned 7,500,000 shares of the Company. The interests of Real Potential in the Company are therefore deemed to be the interests of Peaceful World in which KY Ma is also deemed to have interests for the reason as stated in note 5 above.

– 51 –

APPENDIX II

GENERAL INFORMATION

(b) Subsidiaries

					Percentage of the	Percentage of the
					subsidiary’s	issued
Name of	Name of		Number of	Type of	share	capital
subsidiaries	directors	Capacity	shares held	shares	(Ordinary shares)
Amica	KY Ma	Beneficial owner	10,000	Ordinary		10
Development
Limited
Carrianna Chiu Chow	KY Ma	Beneficiary of trust	15,000	Ordinary		1.5
Restaurant (T.S.T.)
Limited
Carrianna Chiu Chow	Yip Hing Chung	Beneficial owner	100,000	Ordinary		10
Restaurant (T.S.T.)
Limited
Ginza Development	KC Ma	Beneficial owner	15	Ordinary		2.5
Company Limited
Ginza Development	KY Ma	Beneficiary of trust	18	Ordinary		3
Company Limited
Ginza Development	Yip Hing Chung	Beneficial owner	30	Ordinary		5
Company Limited
Gartrend Development	KC Ma	Beneficial owner	500,000	Non-voting deferred		N/A
Limited
Gartrend Development	KY Ma	Beneficial owner	500,000	Non-voting deferred		N/A
Limited
Tak Sing Alliance	KC Ma	Beneficial owner	9,000	Non-voting deferred		N/A
Limited
Tak Sing Alliance	KY Ma	Beneficial owner	1,000	Non-voting deferred		N/A
Limited

In addition to the above, KC Ma and KY Ma have non-beneficial personal equity interests in certain subsidiaries held for the benefit of the Group solely for the purpose of complying with their minimum company membership requirements.

– 52 –

GENERAL INFORMATION

APPENDIX II

Save as disclosed above, as at the Latest Practicable Date, none of the Directors or chief executive of the Company or their associates had any interests or short positions in the shares, underlying shares or debentures of the Company, or any associated corporations (within the meaning of Part XV of the SFO) as recorded in the register required to be kept by the Company pursuant to Section 352 of the SFO, or as otherwise notified to the Company and the Stock Exchange pursuant to the Model Code.

3. OTHER INTERESTS OF DIRECTORS

(a) Interests in service contracts

At as the Latest Practicable Date, none of the Directors has entered, or is proposing to enter, into a service contract with any member of the Group, excluding contracts expiring or determinable by the Group within one year without payment of compensation (other than statutory compensation).

(b) Interests in assets of the Group

Since 31 March 2006, the date to which the latest published audited accounts of the Company have been made up, none of the Directors has, or has had, any direct or indirect interest in any assets which have been acquired or disposed of by or leased to any member of the Group or are proposed to be acquired or disposed of by or leased to, any member of the Group.

(c) Interests in contracts or arrangements

Save as disclosed above, none of the Directors is materially interested in any contract or arrangement subsisting at the date of this circular which is significant in relation to the business of the Group taken as a whole.

– 53 –

GENERAL INFORMATION

APPENDIX II

4. SUBSTANTIAL SHAREHOLDERS

As at the Latest Practicable Date, the following persons (other than a Director or chief executive of the Company) had the following interests or short positions in the shares or underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of the Part XV of SFO, or who is, directly or indirectly, interested in 5% 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:–

				Percentage
				of the
			Number	Company’s
			of ordinary	issued
Name of shareholder	Capacity	Notes	shares held	share capital
East Asia International	Trustee	a	360,330,065	36.79
Trustees Limited
Golden Yield Holdings	Interest in	b	259,129,025	26.46
Limited	controlled
	corporations
Wealthy Platform	Interest in	c	101,201,040	10.33
Limited	controlled
	corporations
Regent World Investments	Holding	b	184,121,625	18.80
Limited	corporation
Bond Well Investments	Holding	b	75,007,400	7.66
Limited	corporation
Grand Wealth Investments	Holding	c	74,651,040	7.62
Limited	corporation

– 54 –

GENERAL INFORMATION

APPENDIX II

Notes:

• a. East Asia International Trustees Limited (“EAIT”) is the trustee of a discretionary trust of which KC Ma and his family are the objects and through its wholly-owned subsidiary, Golden Yield Holdings Limited (“Golden Yield”), EAIT was indirectly interested in 259,129,025 shares of the Company. EAIT is also the trustee of a discretionary trust of which KY Ma and his family are the objects and through its whollyowned subsidiary, Wealthy Platform Limited (“Wealthy Platform”), EAIT was indirectly interested in 101,201,040 shares in the Company. As at the date of this circular, EAIT was effectively interested in a total of 360,330,065 shares of the Company.

• b. Golden Yield owns the entire issued share capital of Regent World and 70% of the entire issued share capital of Bond Well, was indirectly interested in a total of 259,129,025 shares of the Company. The total shares held by both Regent World and Bond Well are the same block of shares as disclosed in “Other interests” of KC Ma under the section headed “Disclosure of Interests by Directors and Chief Executive” set out above.

• c. Wealthy Platform owns the entire issued share capital of Grand Wealth and Peaceful World and indirect owns the entire issued share capital of Real Potential through Peaceful World, was indirectly interested in 101,201,040 shares of the Company. The total shares held by Grand Wealth, Peaceful World and Real Potential are the same block of shares as disclosed in “Other interests” of KY Ma under the section headed “Disclosure of Interests by Directors and Chief Executive” set out above.

Save as disclosed above, as far as was known to the Directors as at the Latest Practicable Date, no other person (other than a Director or chief executive) had any interest or short positions in shares or underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of the Part XV of SFO, or who is, directly or indirectly, interested in 5% 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.

5. COMPETING INTERESTS OF DIRECTORS AND ASSOCIATES

As at the Latest Practicable Date, the Directors were not aware that any of the Directors has interest in any business which competes or is likely to compete, either directly or indirectly, with the business of the Group which falls to be disclosed under the Listing Rules.

6. LITIGATION

As at the Latest Practicable Date, no member of the Group was engaged in any litigation or arbitration proceedings of material importance and there was no litigation or claim of material importance known to the Directors to be pending or threatened against any member of the Group.

– 55 –

GENERAL INFORMATION

APPENDIX II

7. MATERIAL ADVERSE CHANGE

There has not been any material adverse change in the financial or trading position of the Group since 31 March 2006 when the last published audited accounts of the Group was made up.

8. QUALIFICATION OF EXPERT, CONSENT AND EXPERT’S INTERESTS

The following is the qualifications of the experts who have given their opinion or advice contained in this circular:

Qualification

Name Qualification Partners Capital International a licensed corporation to perform Type 1 and Limited (the “IFA”) Type 6 regulated activities under SFO Vigers Appraisal & Consulting Ltd Independent property valuer (the “Valuer”)

Each of the IFA (an independent financial advisor) and the Valuer (an independent property valuer) has given and has not withdrawn its written consent to the issue of this circular with the inclusion of its letter or report and references to its name in the form and context in which they appear.

Each of the IFA and the Valuer confirmed that as at the Latest Practicable Date it did not have any shareholding in the Company or any of its subsidiaries or any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group.

Each of the IFA and the Valuer further confirmed that as at the Latest Practicable Date it did not have any interest, direct or indirect, in any assets which have been, since 31 March 2006 (being the date to which the latest published audited accounts of the Group were made up), acquired or disposed of by or leased to any member of the Group, or are proposed to be acquired or disposed of by or leased to any member of the Group.

– 56 –

GENERAL INFORMATION

APPENDIX II

9. MATERIAL CONTRACT

The following contracts (not being contracts entered into in the ordinary course of business) have been entered into by the Company or its subsidiaries within two years preceding the date of this circular and which are or may be material:

• (a) The sale and purchase agreement relating to the Former Acquisition; and

• (b) The Agreement.

10. GENERAL

• (a) The company secretary and qualified accountant of the Company is Mr. Ng Yan Kwong. He is a member of the Hong Kong Institute of Certified Public Accountants and the CPA Australia.

• (b) The registered office of the Company is situated at Canon’s Court, 22 Victoria Street, Hamilton HM12, Bermuda

• (c) The branch share registrar of the Company in Hong Kong is Tengis Limited at 26/F, Tesbury Centre, 28 Queen’s Road East, Hong Kong.

• (d) The English text of this circular shall prevail over the Chinese text.

11. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection at the head office and principal place of business of the Company at 26/F., Phase II, Wyler Centre, 200 Tai Lin Pai Road, Kwai Chung, New Territories, Hong Kong during normal business hours on any business day from the date of this circular until 14 days hereafter:

• (a) this circular;

• (b) the Agreement;

• (c) the Memorandum of Association and Bye-Laws of the Company;

• (d) the letter from the Independent Board Committee to the Independent Shareholders;

– 57 –

GENERAL INFORMATION

APPENDIX II

• (e) the letter of advice from Partners Capital International Limited to the Independent Board Committee and the Independent Shareholders;

• (f) the letter and valuation certificate in relation to the Property prepared by the Valuer;

• (g) the written consents referred to in the paragraph headed “ Qualification of Expert, Consent and Expert’s Interests ” in this Appendix.

– 58 –

NOTICE OF THE SPECIAL GENERAL MEETING

TAK SING ALLIANCE HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code: 126)

NOTICE IS HEREBY GIVEN (the “Notice”) that a special general meeting (the “Meeting”) of Tak Sing Alliance Holdings Limited (the “Company”) will be held at Carrianna (Chiu Chow) Restaurant, 1st Floor, 151 Gloucester Road, Wanchai, Hong Kong on Thursday, 23 August 2007 at 11:30 a.m. for the purpose of considering and, if thought fit, passing (with or without modification) the following resolutions as ordinary resolutions of the Company

ORDINARY RESOLUTIONS

“ THAT

1. the Acquisition (as defined and more particularly described in the circular issued by the Company to its shareholders dated 18 June 2007 (the “Circular”)) and the entering into of the Agreement (as defined in the Circular) in relation to the proposed acquisition of the Sales Interests (as defined in the Circular) at a consideration of RMB167,000, 000 which represents a discount of 17.5% to the valuation figure of the Sales Interests and such consideration will be satisfied as to RMB83,500,000 by cash and RMB83,500,000 by the issue of 30,476,677 Consideration Shares, and the performance of the transactions contemplated by the Agreement; and

2. the Consideration Shares (as defined in the Circular) to be allotted and issued to the Vendor or its nominees, subject to the Listing Committee of The Stock Exchange of Hong Kong Limited granting or agreeing to grant the listing of, and permission to deal in, the Consideration Shares, and such Consideration Shares to rank pari passu in all respects with the existing issued shares of the Company,

be and are hereby approved, ratified and confirmed; and any two directors of the Company if the affixation of the common seal is necessary, be and are hereby authorized for and on behalf of the Company to execute all such other documents, instruments and agreements as are necessary and desirable and expedient in their opinion to implement and/or give effect to the terms of the Acquisition and the matters referred to above in this resolution and in the Circular or which the directors of the Company otherwise consider necessary or desirable or

– 59 –

NOTICE OF THE SPECIAL GENERAL MEETING

expedient to be done in connection with any of the foregoing and to do all such acts or things deemed by him/her to be incidental to, ancillary to or in connection with the matters contemplated in the Agreement, including but not limited to the issue of the Consideration Shares”.

Yours faithfully,

For and on behalf of the Board Tak Sing Alliance Holdings Limited Ma Kai Cheung Chairman

Hong Kong, 18 June 2007

Principal place of business:

26th Floor, Phase II Wyler Centre 200 Tai Lin Pai Road Kwai Chung, New Territories Hong Kong

Registered office:

Canon’s Court, 22 Victoria Street, Hamilton HM12, Bermuda

Notes:

1. A member of the Company entitled to attend and vote at the SGM is entitled to appoint another person as his proxy to attend and vote in his stead. A member who is the holder of two or more Shares may appoint more than one proxy to represent him and vote on his behalf at the SGM. A proxy need not be a member of the Company.

2. In order to be valid, the form of proxy must be deposited at the Company’s branch share registrar, Tengis Limited, 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong, together with the power or attorney or other authority (if any) under which it is signed or certified copy of such power of attorney or authority, not later than 48 hours before the time appointed for holding the SGM or any adjournment thereof.

3. Where there are joint holders of any Share, any one of such persons may vote at the SGM 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 SGM personally or by proxy, the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders, and for this purpose seniority shall be determined by the order in which the names stand in the register of members of the Company in respect of such joint holding.

– 60 –