At an extraordinary meeting of the 11th Board of Directors held on 23 Oct 2008, the following proposals were examined and approved:

1. the 3Q 2008 Report
2. to approve the sale by Jiangsu Yinhe Machinery Co., Ltd., a subsidiary in which the company holds a 46.7% stake, of its 92.44% stake in Chengde Yinhe Connecting Rod Co., Ltd. to other shareholders of Jiangsu Yinhe, who will thus be in direct possession of stakes in Chengde Yinhe
Based on Jiangsu Yinhe's equity (as of 30 Sept 2008) in Chengde Yinhe, the transaction is priced at RMB 52,493,363, of which the company will contribute RMB 24,514,401. Following the acquisition, the company will hold a 43.16% stake in Chengde Yinhe. The matter constitutes a related-party transaction.

Following the equity transfer, the company will sell an 8.16% stake in Chengde Yinhe to Jiangsu Agribusiness Group Corp. for RMB 4,903,556, nevertheless retaining its status as Chengde Yinhe's second-largest shareholder with a 35% stake.

Board of Directors
23 Oct 2008


Source: Shanghai Stock Exchange

Date: 27 Oct 2008

CN01/ZZ/SW/JE/MM