51% Equity Interest Acquired

On 27 Oct 2008, the company signed two separate equity transfer agreements with Inner Mongolia Eerduosi Cashmere Products, Co., Ltd. (MECP), the controlling shareholder, and Eerduosi Cashmere Investment Co., Ltd. (ECI), a related party. According to the agreements, the company will purchase a 40% stake and a 11% stake in Shanghai Eerduosi Garments Holding Co., Ltd. (SEGH) from MECP and ECI, respectively. Following consultation, the acquisition price for the 40% stake and 11% stake have been settled at RMB 32 mln and RMB 8.8 mln, based on the RMB 64.65 mln in assessed net asset value of SEGH on 30 Jun 2008.

The aforementioned issues constitute related-party transactions.

Board of Directors
28 Oct 2008


Source: Shanghai Stock Exchange

Date: 28 Oct 2008

CN01/NZ/VW/DM/NK/KM