MAJOR TRANSACTION - TOM Group

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REASONS FOR ENTERING INTO THE STOCK PURCHASE AGREEMENT Cité Publishing Holding serves as a common platform for further business expansion and integration by reducing paper, printing and production costs (such as the ability to negotiate bulk purchase price for paper and other printing related services) and the effective sharing of back office functions such as administration, accounting, human resources and warehousing. It will further enhance the competitive edge of TOM’s Taiwan publishing business and draw on synergies across the board to further improve operating performance and profitability. Cité Publishing Holding will work closely with the TOM Group’s Hong Kong and PRC publishing units. Areas for cooperation and creating business synergies include know-how and experience exchange, copyright trading, operational management, distribution and advertising. Upon Completion, the interest of the TOM Group in the Print Media Group will be increased from 76.71% to up to 88.355%. As a result, the TOM Group may exercise more operational and financial control over the Print Media Group and achieve better synergy for the TOM Group as a whole. As at the date of this announcement, there is no intention on the part of the TOM Group to further increase its interest in the Print Media Group. GENERAL The Directors consider that the Stock Purchase Agreement is entered into on normal commercial terms, and in the ordinary and usual course of business of the TOM Group and that the terms of the Stock Purchase Agreement are fair and reasonable and in the interests of the TOM Group so far as the shareholders of TOM are concerned. The Consideration Shares will be allotted and issued pursuant to the specific mandate to be granted to the Directors by the shareholders of TOM at the EGM. TOM will make an application to the Listing Committee of GEM for the listing of and permission to deal in the Consideration Shares to be issued pursuant to the Stock Purchase Agreement. Based on the latest adjusted net asset value of the TOM Group and the application of Rule 19.18 of the GEM Listing Rules as stated in the Confirmation Announcement, the Print Media Group Restructuring and the Cité Acquisition constitutes a major transaction involving the issuance of new TOM Shares under Chapter 19 of the GEM Listing Rules. The Cité Acquisition is conditional upon approval by the shareholders of TOM at a general meeting. Any shareholder of TOM who is interested in the Stock Purchase Agreement and the transactions contemplated thereunder shall abstain from voting at the EGM. To the best of the knowledge of TOM, the HMG MI Shareholders are collectively interested in less than 1% of the Existing Capital and they will abstain from voting at the EGM. A circular containing further details of the Stock Purchase Agreement and the transactions contemplated thereunder and the notice of the EGM will be despatched to the shareholders of TOM as soon as practicable. TOM will also publish the details of the Modified Ratio calculation as described in the Confirmation Announcement and its application to the notifiable transactions of TOM in the next published annual report and accounts. – 12 –
The business of the TOM Group includes cross-media strategy and telecom value added services, such as an Internet portal delivering Internet infotainment content and services, e-commerce propositions, development of software and computer network systems, provision of related services and event production, broadband content and service provision, sportsrelated content, event management and advertising, web-based e-mail service provision, outdoor media advertising, online media businesses and print media businesses. DEFINITIONS “10-day Average Price” “Associates” “Board” “Business Weekly” “Cité” “Cité Acquisition” “Cité Publishing Holding” “Cité Publishing Holding Share(s)” means HKD2.069, being the average closing price per TOM Share of the 10 consecutive trading days immediately before and including the date of the Stock Purchase Agreement as quoted on the Stock Exchange has the same meaning as ascribed thereto under the GEM Listing Rules means the board of Directors means (Business Weekly Publishing Inc.), a company incorporated in Taiwan and a wholly-owned subsidiary of Diamond means (Cité Publishing Limited), a company incorporated in Taiwan and is 99.97% owned by HMG. The remaining 0.03% shareholding of Cité is owned by a person who is independent of the Directors, chief executive, substantial shareholders and management shareholders of TOM and their respective Associates and does not hold any TOM Share means the acquisition by TOM Print Media of up to an aggregate of 11.645% of the issued share capital of Cité Publishing Holding from all or some of the HMG MI Shareholders who have accepted the Offer pursuant to the Stock Purchase Agreement means Cité Publishing Holding Limited, a company incorporated in the British Virgin Islands. Upon completion of the Print Media Group Restructuring, TOM Print Media will own 76.71% and the HMG MI Shareholders will own an aggregate of 23.29% of Cité Publishing Holding means the share(s) of USD0.01 each in the capital of Cité Publishing Holding – 13 –
Page 1 and 2: This announcement appears for infor
Page 3 and 4: On 27th December, 2002, TOM Print M
Page 5 and 6: Shareholding structure before and a
Page 7 and 8: The price per Consideration Share r
Page 9 and 10: Completion Completion shall take pl
Page 11: HMG, PC Home and Cité HMG is the h
Page 15 and 16: “HMG” “HMG MI Shareholders”
Page 17: “Subscription Agreement” “Tai

MAJOR TRANSACTION - TOM Group

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