Hong Kong, March 8, 2001 - Shenzhen High-Tech Holdings Limited ("Shenzhen High-Tech") (HKSE: 106) today announces that it has entered into a sale and purchase agreement on March 8, 2001 to acquire the entire interest of Shenzhen Dawning Information Industry Company Limited ("Dawning") held by Beijing Dawning Computer Corporation, Shenzhen Investment Holding Corporation, Chongqing Zhaohua Technology Company Limited, Sichuan Provincial Investment Group Company Limited, and Beijing Gaoguoke Corporation, for a total consideration of RMB215 million (HK$201 million). Half of the consideration of RMB107.5 million (HK$100.5 million) will be settled by the issue of 516,541,335 new shares (Òconsideration shares? at an issue price of HK$0.1945 per share and the balance by the issue of convertible notes at a conversion price of HK$0.1945.

The price of the consideration shares represents a premium of 4.87% to RMB205 million. The price of the new issued shares represents a discount of around 5.12% to the closing price of HK$0.205 as on March 7, 2001 and a discount of around 6.5% to the average closing price of HK$0.208 for the previous ten trading days. The consideration shares will represent 10.1% of the Group's existing issued share capital and 9.2% of the issued share capital enlarged by the issue of new shares.

The convertible notes are convertible at a conversion price of HK$0.1945, bEarning no interest and with a maturity period of two years. Assuming the convertible notes will be fully exercised, the conversion shares will represent 10.1% of the Group's existing issued share capital and 8.4% of the issued share capital enlarged by the issue of new shares and conversion shares.

The acquisition has been officially approved by the China Securities Regulatory Commission ("CSRC") on January 18, 2001.

"Dawning Information is the only company in China that has the capabilities to research, develop, produce and sell the full range of computer servers worth from RMB20,000 to nearly RMB100 million. It is encouraging to know that Dawning, a company that manufactures and sells high performance computer servers with its home base in China, has its products very well received by the market. Its well-established market position and reliable capability is well exemplified when orders rush in even before the official launch of its new products. The joining in of Dawning with Shenzhen High-Tech represents a fresh driving force for us to further explore and exploit business opportunities in the area of advanced technology. It also signifies an important step forward for State supported enterprises to evolve successfully into a viable commercial business." Said Mr Li Heihu, Chairman, Shenzhen High-Tech.

"In addition to the business operation of Dawning, Shenzhen High-Tech will be actively on the lookout to identify businesses with good development prospect, profitability track records, positive cash inflow and potentials of achieving synergy effects with the group's business, through shares swap, acquisition or investment by purchase of shares, to further expand, extend and develop our business operations." Added Mr Gong Hanbing, Executive Director and President, Shenzhen High-Tech.

Dawning is a pioneer in developing high performance computer systems and servers. Founded in June 1995, Dawning is a successful outcome of China's "863" programme. With a staff of about 1,000, Dawning is the only manufacturer in China which has its own research and development division, production facilities as well as sales and marketing division for high performance computers and servers. It is supported in various technical aspects by National Research Center for Intelligent Computing Systems ("NCIC") and National Research Center for High Performance Computers ("NCHPC") under Ministry of Science and Technology. For the financial year ended December 31, 1999, the audited net profit after taxation of Dawning amounted to around RMB7,542,000.

Shenzhen High-Tech Holdings Limited ("Shenzhen High-Tech") (HKSE: 106) has its business focus in developing business operations in the area of advanced technology in Greater China. With the management devoting keen efforts in reorganizing its business operations in recent years, the group has accomplished its debt restructuring and business repositioning exercise. In August last year, Shenzhen High-Tech has successfully raised funds by placing new shares. To date, the group has basically no long-term debts and a net cash balance of over HK$100 million. The acquisition of Dawning will further enhance the group's core business in the area of advanced technology.

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Shenzhen High-Tech Holdings Limited

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