Holding Boost in QHCNC

On 28 Oct 2008, the company signed an equity transfer agreement with Heilongjiang Zhongmeng Group Co., Ltd. (HZG) to purchase a 3.16% stake in Qiqihar Heavy CNC Equipment Co., Ltd. (QHCNC), a subsidiary of the company, at RMB 2.40 per share. The total payment for the transfer is RMB 19.2 mln, based on the assessed value of QHCNC as of 31 Mar 2008. Upon the transfer, the company's holdings in QHCNC will increase from 71.32% to 74.48%.

The equity transfer has been examined and approved at the 24th Meeting of the 2nd Board of Directors, held on 27 Oct 2008, and will become valid as of the date it is approved by the relevant authorities. Related procedures have been completed with Qiqihar Property Rights Exchange. The company will make a one-time payment for the transfer within 20 working sessions of the date the agreement become valid.

The equity transfer will further develop QHCNC's major businesses and promote its sustainable operability and competitiveness, so as to promote its overall profitability and assure the company's long-term development.

Board of Directors
29 Oct 2008


Source: Securities Times

Date: 29 Oct 2008

CN01/NW/VW/DM/JE/KM