the annual general meeting of the holders of Domestic Shares
and holders of H Shares of the Company to be convened and
held on Monday, 28 April 2008 for the purpose of approving,
among other things, the proposed bonus issue of Shares, the
proposed Share Consolidation, the Proposed A Share Issue,
amendments of the Articles of Association, the adoption of
independent directors rules, connected transaction decision
policy and the Procedural Rules;
Reasons for the Share Consolidation
The proposed Share Consolidation may be required to facilitate the implementation of the Proposed
A Share Issue depending on the requirements of the Relevant Authorities, because the nominal value
for A shares currently listed and traded on the Shanghai Stock Exchange or Shenzhen Stock Exchange
are at a par value of RMB1.00 each. Accordingly, it is expected the Share Consolidation will not be
implemented unless required by the Relevant Authorities for the purpose of the Proposed A Share
Issue. As such the Directors are of the view that the Share Consolidation, if required by the relevant
law, rules and regulations and the Relevant Authorities to be implemented, is beneficial to the Company
and the Shareholders as a whole.
Conditions of the Share Consolidation
The Share Consolidation is conditional upon the following:
(1) the Board resolutions approving the implementation of the Share Consolidation as authorized
by the Shareholders by way of a special resolution at the AGM and the separate Class Meetings;
(2) consent obtained from the CSRC regarding the proposed Share Consolidation and the Proposed
A Share Issue of A Shares of RMB1.00 each should CSRC require issue of A Shares of RMB1.00
each rather than RMB0.50 each;
(3) the Listing Committee granting approval for the listing of, and permission to deal in, the
Consolidated H Shares.
