IGB CORPORATION BERHAD PART A STATEMENT in relation to ...

THIS STATEMENT/CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION.If you are in doubt as to the course of action to be taken, you should consult your stockbroker, bankmanager, solicitor, accountant or other professional adviser immediately.If you have sold or transferred all your ordinary shares in IGB Corporation Berhad (“IGB” or “Company”),please hand this Statement/Circular together with the accompanying Proxy Form enclosed in the AnnualReport of IGB for the financial year ended 31 December 2005 (“Annual Report 2005”) to the purchaser,stockbroker or agent through whom the sale or transfer was effected for onward transmission to thepurchaser or transferee.Bursa Malaysia Securities Berhad (“Bursa Securities”) has not perused the contents of the ProposedRenewal of Share Buy-Back Authority (as defined herein) prior to the issuance of this Statement/Circular.Bursa Securities takes no responsibility for the contents of this Statement/Circular, makes no representationas to its accuracy or completeness and expressly disclaims any liability whatsoever arising from or inreliance upon the whole or any part of the contents of this Statement/Circular.IGB CORPORATION BERHAD(5745-A)PART ASTATEMENTin relation toPROPOSED RENEWAL OF SHARE BUY-BACK AUTHORITYPART BCIRCULAR TO SHAREHOLDERSin relation toPROPOSED SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONSOF A REVENUE OR TRADING NATUREThe above proposals will be tabled as Special Business at IGB’s Forty-Second Annual General Meeting(“42 nd AGM”). Notice of 42 nd AGM to be held at Bintang Ballroom, Level 5, Cititel Mid Valley, Mid ValleyCity, Lingkaran Syed Putra, 59200 Kuala Lumpur on Wednesday, 31 May 2006 at 3.00 p.m. together with theProxy Form is set out in the Annual Report 2005. The Proxy Form must be completed and deposited at theRegistered Office of the Company at Penthouse, Menara IGB, No. 1, The Boulevard, Mid Valley City,Lingkaran Syed Putra, 59200 Kuala Lumpur not less than forty-eight (48) hours before the time appointedfor holding the 42 nd AGM or at any adjournment thereof. The lodging of the Proxy Form will not precludeyou from attending and voting in person at the 42 nd AGM should you subsequently find that you are able todo so.Last date and time for lodging the Proxy Form : 29 May 2006 at 3.00 p.m.Date and time of 42 nd AGM : 31 May 2006 at 3.00 p.m.This Statement/Circular is dated 28 April 2006

DEFINITION (cont’d)b) a trustee of a trust (other than a trustee for an employee share schemeor pension scheme) under which the Director, Major Shareholder or amember of the Director’s or Major Shareholder’s family is the solebeneficiary;c) a partner of the Director, Major Shareholder or a partner of a personconnected with that Director or Major Shareholder;d) a person who is accustomed or under an obligation, whether formal orinformal, to act in accordance with the directions, instructions or wishesof the Director or Major Shareholder;e) a person in accordance with whose directions, instructions or wishes theDirector or Major Shareholder is accustomed or is under an obligation,whether formal or informal, to act;f) a body corporate or its directors which/who is/are accustomed or underan obligation, whether formal or informal, to act in accordance with thedirections, instructions or wishes of the Director or Major Shareholder;g) a body corporate or its directors whose directions, instructions or wishesthe Director or Major Shareholder is accustomed or under an obligation,whether formal or informal, to act;h) a body corporate in which the Director, Major Shareholder and/orpersons connected with him are entitled to exercise, or control theexercise of, not less than 15% of the votes attached to voting shares inthe body corporate; ori) a body corporate which is a related corporationProposed Renewal ofShare Buy-Back AuthorityProposed Shareholders’Mandate: Proposed renewal of the authorisation for IGB to purchase its own Shares,which when aggregated with the Shares already purchased previously andretained as Treasury Shares, up to a maximum of ten per cent (10%) of itsissued and paid-up capital: Proposed renewal and additional shareholders’ mandate for Recurrent RPTsof IGB Group.Purchased Shares : Shares purchased pursuant to share buy-backRPTs : Related party transactionsRecurrent RPTs : RPTs involving recurrent transactions of a revenue or trading nature whichare in the ordinary course of business and are necessary for day-to-dayoperations, entered into by the IGB Group which involve the interest, director indirect, of a Related PartyRelated Party : A Director, Major Shareholder or Person(s) ConnectedRM and sen : Ringgit Malaysia and sen respectivelyShares or IGB Shares : Ordinary Shares of RM0.50 each in IGBTreasury Shares : Purchased Shares which are or will be retained in treasury by the CompanyPage ii

PART ASTATEMENTin relation toPROPOSED RENEWAL OF SHARE BUY-BACK AUTHORITYPage 1

IGB CORPORATION BERHAD (5745-A)STATEMENT IN RELATION TO PROPOSED RENEWAL OF SHARE BUY-BACK AUTHORITY1. INTRODUCTIONOn 26 May 2005, the shareholders of the Company had at the 41 st AGM approved the resolutionpertaining to the share buy-back authority granted to the Company. This authority from shareholdersshall, in accordance with the Listing Requirements, expire at the conclusion of the forthcoming 42 ndAGM of the Company which will be held on 31 May 2006.On 6 April 2006, the Board of the Company announced the Company’s intention to seek theshareholders’ approval for the Proposed Renewal of Share Buy-Back Authority.The authority from shareholders, if renewed, shall be effective upon the passing of the ordinaryresolution for the Proposed Renewal of Share Buy-Back Authority, and will remain in effect until theconclusion of the next AGM of the Company, or until the expiry of the period within which the next AGMis required by law to be held, unless earlier revoked or varied by an ordinary resolution of theshareholders of the Company in general meeting.2. RATIONALE AND BENEFITSThe Proposed Renewal of Share Buy-Back Authority would enable IGB Group to utilise its surplusfinancial resources to purchase the Shares of the Company from the market. It may stabilise the supplyand demand of IGB Shares traded on the Main Board of Bursa Securities and thereby support itsfundamental value.Treasury Shares will give the Directors the option to sell at a higher price on Bursa Securities andrealize a potential gain without affecting the total issued and paid-up share capital of the Company. TheTreasury Shares may also be distributed to shareholders as dividends and, if undertaken, would serveto reward the shareholders of the Company.3. FUNDINGThe Board proposes to allocate an amount wholly out of retained profits and/or share premium accountof the Company for the purchase of its own Shares.The audited retained earnings of the Company as at 31 December 2005 were approximately RM1,198.1million whilst the audited share premium account of the Company as at 31 December 2005 wasapproximately RM383.5 million.The share buy-back if implemented, will be funded by internally generated funds of the Group and/orexternal borrowings.The amount of internally generated funds and/or external borrowings to be utilised will only bedetermined later depending on the available internally generated funds, actual number of IGB Shares tobe purchased and other factors.In the event the Company purchases and holds its own Shares using external borrowings, the Boardwould ensure the Company has sufficient funds to repay the external borrowings and the repayment willhave no material effect on the cashflow of the Group.4. RISK ASSESSMENTThe Proposed Renewal of Share Buy-Back Authority is not expected to have any potential materialdisadvantages to the Group and shareholders of IGB.Page 2

However, the share buy-back if implemented, would reduce the financial resources of the Group. Thismay result in the Group having to forgo any good investment opportunities that may emerge in thefuture and/or any income that may be derived from the funds utilised for implementation of the sharebuy-back.On the other hand, the financial resources of the Group may increase pursuant to the resale of theTreasury Shares at prices higher than the purchase price.In this connection, the Board will be mindful of the interests of the Group and shareholders of IGB inimplementing the share buy-back and/or any subsequent resale.5. EFFECTS OF SHARE BUY-BACKAssuming that the share buy-back is implemented in full, the proforma effects of the share buy-backwould be as follows:(a) Share CapitalBased on the assumption that all the Purchased Shares (including the existing 15,969,100 TreasuryShares) are subsequently cancelled, the issued and paid-up share capital of IGB would be reducedas follows:RMIssued and paid-up ordinary share capital as at 18 April 2006(Including Treasury Shares)Cancellation of Purchased Sharespursuant to the share buy-back730,834,576(73,083,457.60)Resultant issued and paid-up ordinary share capital 657,751,118.40(b) NAThere would be no effect on the issued and paid-up share capital of IGB if the Purchased Sharespursuant to the share buy-back were retained as Treasury Shares.The effects of the share buy-back on the NA per Share of the Group are dependent on the purchaseprices of IGB Shares and the effective funding cost or loss in interest income to the Group.The share buy-back will reduce the NA per Share when the purchase price exceeds the NA perShare at the relevant point in time. On the contrary, the NA per Share will be increased when thepurchase price is less than the NA per Share at the relevant point in time.(c) Working CapitalThe share buy-back is likely to reduce the funds available for working capital purposes of IGBGroup, the quantum of which depends on the actual purchase price and number of PurchasedShares.(d) EPSThe effects of the share buy-back on the EPS of the Group are dependent on the purchase prices ofIGB Shares and the effective funding cost or opportunity loss in interest income to the Group.Page 3

6. PUBLIC SHAREHOLDING SPREADThe public shareholding spread of the Company as at 18 April 2006 is approximately 57.38% held by21,534 public shareholders holding not less than 100 Shares each.The Company, when implementing the share buy-back will be mindful in ensuring that the publicshareholding spread requirement is met. Further, pursuant to Paragraph 12.14 of the ListingRequirements, IGB will not purchase its own shares, if the same results in IGB being in breach ofParagraph 8.15(1) of the Listing Requirements.7. IMPLICATIONS RELATING TO THE CODEBased on the shareholdings of substantial shareholdings as at 18 April 2006 and assuming the sharebuy-back is carried out in full, the Proposed Renewal of Share Buy-Back Authority is not expected totrigger an obligation to undertake a mandatory offer under the Code as the substantial shareholder(s)and/or person(s) acting in concert with direct or indirect interest in IGB exceeding 33% are notexpected to increase by more than 2% in any six (6) month period.In the event the obligation is triggered due to the implementation of the share buy-back, the affectedsubstantial shareholder(s) and/or person(s) acting in concert may be able to seek a waiver underPractice Note 2.9.10 of the Code.8. INTERESTS OF DIRECTORS, MAJOR SHAREHOLDERS AND PERSONS CONNECTEDSave for the inadvertent increase in the percentage shareholdings and/or voting rights of theshareholders of the Company as a consequence of the implementation of the share buy-back, none ofthe Directors or Major Shareholders or Persons Connected has any interest, direct or indirect, in theProposed Renewal of Share Buy-Back Authority or resale of Treasury Shares, if any.9. PURCHASE, RESALE OR CANCELLATION OF IGB SHARES MADE DURING THE FINANCIAL YEARENDED 31 DECEMBER 2005During the financial year ended 31 December 2005, a total of 15,299,600 ordinary shares werepurchased and retained as Treasury Shares. None of the Treasury Shares were resold or cancelledduring the financial year. Details of the purchases are disclosed in the Statement on CorporateGovernance in the Annual Report 2005.10. DIRECTORS’ RECOMMENDATIONYour Board having considered all aspects of the Proposed Renewal of Share Buy-Back Authority is ofthe opinion that the said proposal is in the best interest of IGB. As such, your Board recommends thatyou vote in favour of the ordinary resolution in relation to the Proposed Renewal of Share Buy-BackAuthority to be tabled at the 42 nd AGM. An extract of the said ordinary resolution is enclosed in thisStatement/Circular.This Statement is dated 28 April 2006.Page 4

PART BCIRCULAR TO SHAREHOLDERSin relation toPROPOSED SHAREHOLDERS’ MANDATEPage 5

IGB CORPORATION BERHAD (5745-A)Registered Office:Penthouse, Menara IGBNo. 1, The BoulevardMid Valley CityLingkaran Syed Putra59200 Kuala LumpurBoard of Directors:28 April 2006Tan Sri Abu Talib Bin Othman, ChairmanRobert Tan Chung Meng, Managing DirectorTan Boon Seng, Executive DirectorTan Boon Lee, Executive DirectorTan Sri Dato' Seri Khalid Ahmad Bin SulaimanTan Lei ChengPauline Tan Suat MingTony Tan @ Choon KeatTan Kai SengDatuk Abdul Habib bin MansurYeoh Chong SweeHarun bin Hashim MohdChua Seng Yong, Alternate to Managing DirectorTo:The Shareholders of IGB Corporation BerhadDear Sir/MadamPROPOSED SHAREHOLDERS' MANDATE1.0 INTRODUCTIONOn 6 April 2006, the Board announced the Company’s intention to seek the shareholders’ approval forthe proposed renewal and additional Shareholders’ Mandate for related party transactions involvingrecurrent transactions of a revenue or trading nature which are in the ordinary course of business andare necessary for day-to-day operations entered into by the Group pursuant to Paragraph 10.09 of theListing Requirements at the forthcoming 42 nd AGM of IGB, which will be held on 31 May 2006.The shareholders of the Company had at the 41 st AGM held on 26 May 2005 approved the resolutionpertaining to the Proposed Shareholders’ Mandate, which shall, in accordance with the ListingRequirements, expire at the conclusion of the forthcoming 42 nd AGM of the Company.The purpose of this Circular is to provide you the details of the Proposed Shareholders’ Mandate and toseek your approval for the resolution pertaining to the Proposed Shareholders’ Mandate to be tabled atthe forthcoming 42 nd AGM, notice of which is enclosed in the Annual Report 2005.2.0 PROPOSED SHAREHOLDERS' MANDATE2.1 Listing RequirementsParagraph 10.08 of the Listing Requirements stipulates the obligations of a listed issuer to comply inrelation to Related Party Transactions. However, pursuant to Paragraph 10.09 of the ListingRequirements and Practice Note No. 12/2001, a listed issuer may seek a mandate from shareholders inrespect of recurrent related party transactions of a revenue or trading nature subject to the following:Page 6

(a)(b)the transactions are in the ordinary course of business and are on terms not more favourable tothe related party than those generally available to the public;the shareholders' mandate is subject to annual renewal and disclosure is made in the annualreport of the aggregate value of transactions conducted pursuant to the shareholders' mandateduring the financial year where:(i) the consideration, value of the assets, capital outlay or cost of the aggregated transactions isequal to or exceeds RM1 million; or(ii) any one of the percentage ratios of such aggregated transactions is equal to or exceeds 1%,whichever is the lower;(c)(d)the listed issuer to issue circular to shareholders in relation to the shareholders’ mandate; andin a meeting to obtain the shareholders’ mandate, the interested director, interested majorshareholder or interested person connected with a director or major shareholder; and where itinvolves the interest of an interested person connected with a director or major shareholder, suchdirector or major shareholder, must not vote on the resolution approving the transactions. Aninterested director or interested major shareholder must ensure that persons connected with himabstain from voting on the resolution approving the transactions.Where the Company has obtained the shareholders’ mandate in respect of Recurrent RPTs, theprovisions under Paragraph 10.08 of the Listing Requirements shall not apply during the validity periodof the shareholders’ mandate.2.2 Details of Proposed Shareholders’ MandateIGB is an investment holding and property development company while the principal activities of itssubsidiaries are investment holding, property investment & management, property holding, propertydevelopment, provision of property management & security services, project management services,servicing and maintenance of elevators & engineering services, hotelier, provision of hotel management& consultancy services, construction, provision of exhibition services, home furnishing and operating offood court.The Company proposes to seek its shareholders’ approval for the Proposed Shareholders’ Mandate toenable the Group to enter into Recurrent RPTs with the classes of Related Parties as set out in Section2.2.2 below. The Proposed Shareholders’ Mandate will take effect from the passing of the ordinaryresolution at the forthcoming 42 nd AGM and will continue to be in force (unless revoked or varied by theCompany in general meeting) until the conclusion of the next AGM of the Company or the expiry of theperiod within which the next AGM of the Company is required to be held pursuant to Section 143(1) ofthe Act (but shall not extend such extension as may be allowed pursuant to Section 143(2) of the Act),or revoked or varied by resolution passed by the shareholders in general meeting, whichever is theearlier.2.2.1 Nature of Recurrent RPTsThe Recurrent RPTs to be covered by the Proposed Shareholders’ Mandate are set out below:Nature of TransactionsRefer ToFinancial assistance Pooling of funds within IGB Group via a centralised treasurymanagement function on a short or medium term basis.Provision of guarantee, indemnity or such other collateral toor in favour of another person which is necessary in order toprocure a contract or secure work from the other person orto enable the other person to commence and/or complete acontract of work for IGB GroupPage 7

Nature of TransactionsInformation technologyservicesRental of retail spaceLegal advisory servicesLetting of AssetsProject, construction,management, consultancyand/or support servicesPurchase and supply ofmaterialsSale of land or land basedpropertiesRefer ToPurchase of IT hardware, software, business solution & relatedproducts and procurement of IT consultancy & related services.Rental of retail space and related facilities at Mid ValleyMegamall for a period not exceeding 3 years.Legal advisory and consultancy services by solicitors.Letting of office premises & residential properties and relatedfacilities owned by IGB Group for a period not exceeding 3 yearsand payments relating thereto are not on lump sum basis.Provision or procurement of project management, propertymanagement, sales & marketing management, hotel management& consultancy services, construction services, mechanical &electrical works, landscaping works, advertising services,security services and management services (includingsecretarial, share registration, accounting, internal audit andhuman resource).Purchase and supply of building materials and related products.Sale of land or land based properties provided these transactionsare recurrent in nature and does not exceed 10% of anypercentage ratios as stated in the Listing Requirements.2.2.2 Classes of Related PartiesThe classes of Related Parties having interest in the Recurrent RPTs for which the ProposedShareholders’ Mandate is sought in respect of transactions to be entered into by IGB Group are asfollows:Nature ofTransactions• Rental of retailspace• Letting ofAssets• Project,construction,management,consultancyand/or supportservicesTransactingPartiesKrisAssetsHoldings Bhd(“Kris”) group ofcompanies (“KrisGroup”) 2Interested Related PartiesEstimated valueduring validityperiod of MandateRM’000 1Robert Tan Chung Meng a20,000Tan Boon Seng bTan Lei Cheng cTan Boon Lee dPauline Tan Suat Ming eTony Tan @ Choon Keat fDato’ Tan Chin Nam gDaniel Yong Chen-I hElizabeth Tan Hui Ning iGoldis Berhad (“Goldis”) jTan Chin Nam Sdn Bhd(“TCN”) kTan Kim Yeow Sdn Bhd(“TKY”) lWah Seong (Malaya) TradingCo. Sdn Bhd (“WST”) mPage 8

Nature ofTransactionsTransactingPartiesInterested Related PartiesEstimated valueduring validityperiod of MandateRM’000 1• Informationtechnologyservices• Letting ofAssets• Project,construction,management,consultancyand/or supportservices• Sale of land orland basedpropertiesGoldis group ofcompanies(“Goldis Group”) 3Robert Tan Chung Meng a1,800Tan Boon Seng bTan Lei Cheng cTan Boon Lee dPauline Tan Suat Ming eTony Tan @ Choon Keat fDato’ Tan Chin Nam gGoldis jTCN kTKY lWST m• Purchase andsupply ofmaterials• Sale of land orland basedpropertiesWah SeongCorporationBerhad group ofcompanies(“WSCB Group”) 4Robert Tan Chung Meng a12,000Tan Boon Seng bTan Lei Cheng cTan Boon Lee dPauline Tan Suat Ming eTony Tan @ Choon Keat fDato’ Tan Chin Nam gTCN kTKY lWST m• Letting ofAssets• Project,construction,management,consultancyand/or supportservices• Sale of land orland basedpropertiesWST group ofcompanies (“WSTGroup”) 5Robert Tan Chung Meng a300Tan Boon Seng bTan Lei Cheng cTan Boon Lee dPauline Tan Suat Ming eTony Tan @ Choon Keat fDato’ Tan Chin Nam gTCN kTKY lWST m• Project,construction,management,consultancyand/or supportservicesCahaya UtaraSdn Bhd(“CU”) 6 ,an associate ofWSTRobert Tan Chung Meng a1,500Tan Boon Seng bTan Lei Cheng cTan Boon Lee dPauline Tan Suat Ming eTony Tan @ Choon Keat fDato’ Tan Chin Nam gTCN kTKY lWST mPage 9

Nature ofTransactions Transacting Parties Interested Related PartiesEstimatedvalueduringvalidityperiod ofMandateRM’000 1• Letting ofAssets• Project,construction,management,consultancyand/or supportservices• Sale of land orland basedpropertiesTCN 7Tan Boon Seng b10Tan Lei Cheng cTan Boon Lee dDato’ Tan Chin Nam gTCN k• Legal advisoryservices• Letting ofAssetsJeyaratnam & Chong(“J&C”) 8Tan Boon Seng bTan Lei Cheng cTan Boon Lee dDato’ Tan Chin Nam g 1,000• Project,construction,management,consultancyand/or supportservicesMayside Engineering Antony Patrick Barragry n 200S.A. (“ME”) 9• Financialassistance• Letting ofAssets• Rental of retailspace• Project,construction,management,consultancyand/or supportservices• Purchase andsupply ofmaterialsSubsidiaries andAssociates of IGB Cititel HotelManagement SdnBhd (“CHM”) 10 Earning Edge SdnBhd (“EE”) 11 IST BuildingProducts Sdn Bhd(“IBP”) 12 St. Giles HotelLimited (“SGHL”) 13 Tan & Tan RealtySdn Bhd (“TTR”) 14 TechnolticEngineering Sdn.Bhd. (“TE”) 15Robert Tan Chung Meng a100,000Tan Boon Seng bTan Lei Cheng cTan Boon Lee dPauline Tan Suat Ming eTony Tan @ Choon Keat fDato’ Tan Chin Nam gTCN kTKY lWST mPage 10

Explanatory notes:1The estimated values of Recurrent Transactions from the date of the 42 nd AGM to the dateof the next AGM are based on the transactions and/or management estimates. Due to thenature of the transactions, the actual values of the transactions may vary from the estimatedvalues disclosed.Principal activities of transacting parties23456789101112131415The principal activity of Kris is investment holding whilst its principal subsidiary, Mid ValleyCity Sdn. Bhd. (“MVC”) is the owner and operator of Mid Valley Megamall. Another principalsubsidiary, Mid Valley Capital Sdn Bhd, is a special purpose vehicle incorporated for theissuance of bonds.The principal activities of Goldis Group are investment holding, provision of managementservices, manufacturing of pharmaceutical & paper related products and the provision ofinformation technology services.The principal activities of WSCB Group are investment holding, provision of managementservices, provision of services to the upstream oil & gas exploration & production sectors,manufacturing of spiral welded steel pipes and trading of building materials.The principal activities of WST Group are investment holdings, properties development, sale& distribution of tobacco products and hotelier.The principal activity of CU is operation of hotel.The principal activity of TCN is investment holding.J&C is a legal firm where the Group procures legal advisory services from time to time.The principal activity of ME is consultancy services.The principal activity of CHM is provision of hotel management services.The principal activity of EE is investment holding.The principal activity of IBP is trading of building materials.The principal activity of SGHL is operation of hotel.The principal activities of TTR are property investment & related services and operating offood court.The principal activity of TE is servicing & maintenance of elevators.Nature of relationships of IGB Group with the Interested Related PartiesabcdefgRobert Tan Chung Meng is a Director of IGB Group, Kris Group, WSCB Group, SGHL, CU,WST and TKY. He is a Major Shareholder of IGB, Kris, Goldis, WSCB and TKY. He is thefather of Elizabeth Tan Hui Ning, who is his alternate on the Board of Kris. He is a brotherof Pauline Tan Suat Ming and Tony Tan @ Choon Keat.Tan Boon Seng is a Director of IGB and MVC. He is a son of Dato’ Tan Chin Nam and abrother of Tan Lei Cheng and Tan Boon Lee; and a brother-in-law to Chong Kim Weng, asenior partner of J&C.Tan Lei Cheng is a Director of IGB Group, Kris Group, Goldis Group, TCN and WST. She isa daughter of Dato’ Tan Chin Nam, a sister of Tan Boon Seng and Tan Boon Lee; and thespouse of Chong Kim Weng, a senior partner of J&C.Tan Boon Lee is a Director of IGB Group, Kris, Goldis Group and TCN. He is a son of Dato’Tan Chin Nam, a brother of Tan Boon Seng and Tan Lei Cheng; and a brother-in-law toChong Kim Weng, a senior partner of J&C.Pauline Tan Suat Ming is a Director of IGB, Goldis, WSCB, WST and TKY. She is a MajorShareholder of IGB, Kris, Goldis, WSCB and TKY. She is the mother to Daniel Yong Chen-Iand a sister of Robert Tan Chung Meng and Tony Tan @ Choon Keat.Tony Tan @ Choon Keat is a Director of IGB and TKY. He is a Major Shareholder of IGB,Kris, Goldis, WSCB and TKY. He is a brother of Robert Tan Chung Meng and Pauline TanSuat Ming.Dato’ Tan Chin Nam is a Director of MVC, TCN and WST. He is a Major Shareholder of IGB,Kris, Goldis, WSCB and TCN. Dato’ Tan Chin Nam is the father of Tan Boon Seng, Tan LeiCheng and Tan Boon Lee; and the father–in-law to Chong Kim Weng, a senior partner ofJ&C.Page 11

hijklmnDaniel Yong Chen-I is a Director of IGB Group and Kris Group. He is a son of Pauline TanSuat Ming.Elizabeth Tan Hui Ning is alternate to Robert Tan Chung Meng on the Board of Kris. She isa daughter to Robert Tan Chung Meng.Goldis is a Major Shareholder of IGB and Kris and a Person Connected to Robert Tan ChungMeng, Dato’ Tan Chin Nam, Pauline Tan Suat Ming, Tony Tan @ Choon Keat, TKY, TCNand WST.TCN is a Major Shareholder of IGB, Kris, Goldis, WSCB and WST and a Person Connectedto Dato’ Tan Chin Nam.TKY is a Major Shareholder of IGB, Kris, Goldis, WSCB and WST and a Person Connectedto Robert Tan Chung Meng, Pauline Tan Suat Ming and Tony Tan @ Choon Keat.WST is a Major Shareholder of IGB, Kris, Goldis, WSCB, CHM, CU, SGHL and TTR and aPerson Connected to Robert Tan Chung Meng, Dato’ Tan Chin Nam, Pauline Tan Suat Ming,Tony Tan @ Choon Keat, TCN and TKY.Antony Patrick Barragry is a Director of IGB Group and Kris Group. He is also a Directorand Major Shareholder of ME.2.2.3 Review Procedures for Recurrent RPTsIGB Group has established procedures to ensure that the Recurrent RPTs are conducted on anarm’s length basis and on normal commercial terms consistent with the Group’s usual businesspractices and policies, are not more favourable to the Related Parties than those generallyavailable to the public and are not to the detriment of the minority shareholders.The management of IGB Group has been kept informed of procedures applicable to the RecurrentRPTs, who will ensure that transactions with the Related Parties will only be entered into aftertaking into account the exclusivity of the distributorship, pricing, expertise required and otherrelated factors.A database has been maintained to monitor the Recurrent RPTs disclosed by management whichis tabled to the Audit Committee for review and notation at each audit committee meeting.If a member of the Board and/or Audit Committee has an interest, as the case may be, the personshall abstain from deliberation in respect of the Recurrent RPTs.The annual internal audit plan incorporates a review of the procedures governing the reportingand approval of Recurrent RPTs entered into by the Group and their compliance.The Audit Committee reviews the internal audit reports to ascertain that the guidelines andprocedures established to monitor Recurrent RPTs have been complied with and the review isdone annually.2.2.4 Statement by Audit CommitteeThe Audit Committee has seen and reviewed the procedures governing Recurrent RPTs and issatisfied that such procedures are sufficient to ensure that such Recurrent RPTs are carried outon normal commercial terms, no more favourable to the Related Parties than those generallyavailable to the public and are not detrimental to the minority shareholders of IGB.2.2.5 DisclosureThe Company has disclosed the details of the Recurrent RPTs conducted during the financial yearended 31 December 2005 in its Annual Report 2005 in accordance with Section 4.1.5 of PracticeNote No 12/2001 of the Listing Requirements.Disclosure of the same will be made in the Annual Report for the subsequent financial year duringwhich the Proposed Shareholders’ Mandate is in force, providing among others, the followinginformation:Page 12

(i) the type of Recurrent RPTs transacted; and(ii) the names of the Related Parties involved in each type of Recurrent RPTs and theirrelationships with the Company.2.3 Rationale for Proposed Shareholders’ MandateThe Recurrent RPTs entered or to be entered into by the Group are all in the ordinary course ofbusiness. They are recurring transactions of a revenue or a trading nature which are likely to occurwith some degree of frequency. These transactions may be time sensitive by nature, making itimpractical to seek shareholders’ approval on a case to case basis before entering into such relatedparty transactions. As such, the Board is seeking the Proposed Shareholders’ Mandate pursuant toParagraph 10.09 of the Listing Requirements for these Recurrent RPTs, in order to improve theefficiency in which these transactions are carried out.By obtaining the Proposed Shareholders’ Mandate and renewal of the same on an annual basis, thenecessity to convene separate general meetings from time to time to seek shareholders’ approval asand when such Recurrent RPTs occur would not arise. This would substantially reduce the time,administrative requirements, inconvenience and expenses associated with the convening of generalmeetings, without compromising the corporate objectives of the Group or adversely affecting thebusiness opportunities available therein.The Group have dealt with the Related Parties mentioned in Section 2.2.2 above for years and theRelated Parties have proven to be good customers of the Group as well as reliable suppliers ofmaterials, goods and services required by the Group for its business. The Related Parties are financiallystable and have over the years established good business relationship with the Group with their goodservices and promptness in settlement, as the case may be. The materials, goods and services providedby and/or to the Related Parties are carried out on an arm’s length basis and on terms not morefavourably than those generally available to the public.The various Recurrent RPTs to be entered into by the Group as detailed in Section 2.2.1 above areanticipated to continue to derive income and/or meet the Group’s business needs in good terms and inthe best interest of the Group.2.4 Effects of Proposed Shareholders’ MandateThe Proposed Shareholders’ Mandate is not expected to have any effect on the share capital, NA, EPSof the Group or shareholdings of Major Shareholders in the Company.2.5 Approval RequiredThe Proposed Shareholders’ Mandate is subject to the approval of shareholders at the forthcoming 42 ndAGM to be convened.3.0 INTERESTS OF INTERESTED RELATED PARTIESSave as disclosed below, none of the other Directors, Major Shareholders or Person(s) Connected hasany interest, direct or indirect, in the Proposed Shareholders’ Mandate.The direct and indirect shareholdings of the Interested Related Parties in the issued and paid upordinary share capital of IGB as at 18 April 2006 are as follows:Interested Related PartiesDirectIndirectNo. of Shares % No. of Shares %Robert Tan Chung Meng 3,915,562 0.27 493,612,678* 34.14Tan Boon Seng 616,192 0.04 19,636,996* 1.36Tan Lei Cheng 1,812,667 0.13 1,690,137* 0.12Tan Boon Lee 2,805,574 0.19 - -Pauline Tan Suat Ming 996,777 0.07 493,612,678* 34.14Page 13

Interested Related PartiesDirectIndirectNo. of Shares % No. of Shares %Tony Tan @ Choon Keat - - 493,612,678* 34.14Dato’ Tan Chin Nam 15,712,429 1.09 517,132,691* 35.77Daniel Yong Chen-I 20,000 0.00 - -Elizabeth Tan Hui Ning - - - -Goldis Berhad 368,404,224 25.48 27,715,575* 1.92Tan Chin Nam Sdn. Bhd 51,016,945 3.53 466,115,746* 32.24Tan Kim Yeow Sdn Bhd 30,855,682 2.13 462,756,996* 32.01Wah Seong (Malaya) Trading Co Sdn Bhd 42,835,359 2.96 418,101,387* 28.92Antony Patrick Barragry - - - -Note: * Deemed interest pursuant to Section 6A of the Act.The Interested Directors namely Robert Tan Chung Meng, Tan Boon Seng, Tan Lei Cheng, Tan BoonLee, Pauline Tan Suat Ming and Tony Tan @ Choon Keat have abstained and will continue to abstainfrom Board deliberations pertaining to the Proposed Shareholders’ Mandate.The Interested Related Parties will abstain from voting in respect of their direct and indirectshareholdings in the Company on the resolution pertaining to the Proposed Shareholders’ Mandate at theforthcoming 42 nd AGM.Further, the Interested Related Parties have undertaken to ensure that their Persons Connected willabstain from voting in respect of their direct and indirect shareholdings in the Company on theresolution pertaining to the Proposed Shareholders’ Mandate at the forthcoming 42 nd AGM.The Interested Related Parties as detailed in Section 2.2.2 of this Circular have agreed that IGB maytable one resolution to obtain the shareholders’ mandate for all its Recurrent RPTs even if suchRecurrent RPTs involved several different related parties, nature of transactions and/or classes ofrelated parties.4.0 DIRECTORS' RECOMMENDATION5.0 AGMThe Directors (save for the interested Directors namely Robert Tan Chung Meng, Tan Boon Seng, TanLei Cheng, Tan Boon Lee, Pauline Tan Suat Ming and Tony Tan @ Choon Keat who are deemedinterested in the Proposed Shareholders’ Mandate as mentioned in Section 3.0 above, have abstainedfrom expressing an opinion relating thereto), having considered all aspects of the ProposedShareholders’ Mandate, are of the opinion that the Proposed Shareholders’ Mandate is in the bestinterest of IGB. Accordingly, the Directors (with the exception of the interested Directors who aredeemed interested in the Proposed Shareholders’ Mandate as mentioned in Section 3.0 above, haveabstained from making recommendations on the Proposed Shareholders’ Mandate), recommend that youvote in favour of the ordinary resolution pertaining to the Proposed Shareholders’ Mandate to be tabledat the forthcoming 42 nd AGM.The ordinary resolution pertaining to the Proposed Shareholders’ Mandate is set out as Special Businessin the Notice of the 42 nd AGM contained in the Annual Report 2005, which is sent to you together withthis Statement/Circular. An extract of the said ordinary resolution is enclosed in this Statement/Circular.The 42 nd AGM will be held at Bintang Ballroom, Level 5, Cititel Mid Valley, Mid Valley City, LingkaranSyed Putra, 59200 Kuala Lumpur on Wednesday, 31 May 2006 at 3.00 p.m.If you are unable to attend and vote in person at the 42 nd AGM and wish to appoint a proxy to attend andvote in your stead, you are requested to complete, sign and return the Proxy Form enclosed in theAnnual Report 2005 in accordance with the instructions contained therein and forward it to theRegistered Office of IGB no less than forty-eight (48) hours before the time set for the 42 nd AGM or anyadjournment thereof.The lodging of the Proxy Form will not preclude you from attending and voting in person at the 42 ndAGM if you subsequently wish to do so.Page 14

6.0. FURTHER INFORMATIONShareholders of IGB are advised to refer to the attached Appendix I for further information.Yours faithfullyFor and on behalf of the Board ofIGB CORPORATION BERHADTAN SRI ABU TALIB BIN OTHMANINDEPENDENT NON-EXECUTIVE CHAIRMANPage 15

FURTHER INFORMATIONAPPENDIX I1. RESPONSIBILITY STATEMENTThis Statement/Circular has been seen and approved by the Board of IGB and they collectively andindividually accept full responsibility for the accuracy of the information given in this Statement/Circularand confirm that after making all reasonable enquiries and to the best of their knowledge and belief,there are no other facts, the omission of which would make any statement herein misleading.2. MATERIAL CONTRACTSSave as disclosed below, there are no material contracts (not being contracts entered into the ordinarycourse of business), which have been entered into by IGB and/or its subsidiaries during the two (2)years immediately preceding the date of this Statement/Circular:(i)(ii)On 7 September 2004, MVC via a special purpose vehicle, Mid Valley Capital Sdn Bhd, a whollyowned subsidiary of Kris, entered into an agreement with United Overseas Bank (Malaysia) Bhd(“UOB”) and OCBC Bank (Malaysia) Berhad (“OCBC”) to issue up to RM400 million Nominal ValueRedeemable Secured Bonds (“Bonds”). The Bonds issued comprises two (2) classes: Class 1consists of 6 series with an issue amount of RM285 million and Class 2 consists of 4 series withan issue amount of RM115 million. The Bonds have maturity dates ranging from 3 to 11 yearsfrom the date of issuance. Proceeds had been utilised by MVC to refinance its existingborrowings. UOB and OCBC are the Principal Adviser and Lead Arrangers respectively, and alsothe primary subscribers to the Bonds; andOn 6 December 2005, Kris entered into a subscription agreement with United Overseas Bank (M)Bhd (being the primary bonds subscriber) and Hwang-DBS Securities Berhad (being the primarywarrants subscriber) in relation to RM200,000,000 nominal value of 7-year bank guaranteedbonds (“BG Bonds”) together with detachable provisional rights to allotment of 110,134,166 5-year warrants (“Warrants”) on a “bought-deal” basis. The coupon rate-to-call of the BG Bondsis 3.40% per annum up to the 5th year from issuance and coupon rate of the 6th & 7th years is5.65% per annum, if the option for 2-year extension is exercised at the 5th year. The BG Bondswere issued on 23 December 2005 and proceeds therefrom were utilised to redeem 2,000,000 outof 2,930,000 5-year redeemable preference shares of RM0.10 each (“RPS”) at RM100.00 per RPSon 30 December 2005. The Warrants will be offered for sale to Kris shareholders on arenounceable basis of one (1) Warrant for every three (3) ordinary shares of RM1.00 each held inKris on a book closure date to be determined and announced in due course.3. MATERIAL LITIGATION, CLAIMS OR ARBITRATIONSave as disclosed below, neither IGB nor any of its subsidiaries have engaged in any material litigation,claims or arbitration, either as plaintiff or defendant as at the date of this Statement/Circular, and IGB isnot aware of any proceedings, pending or threatened against IGB or its subsidiaries, or any facts likelyto give rise to any proceedings which might materially and adversely affect the financial position orbusiness of the IGB Group:(i)On 11 October 1991 (Suit No. S2-22-454-1991), Akitek Tenggara Sdn Bhd (“AT”) commenced anaction for a breach of contract arising from the wrongful termination of services of AT by MVC.On 11 May 1999, the High Court ordered MVC to pay AT the sum of RM7,705,382.00 togetherwith the interests and costs from 1 November 1988.The High Court has granted a stay of execution of the judgement pending the appeal on conditionthat MVC pays RM2 million and provides a bank guarantee for the balance sum to AT.In suit W-02-384-1999, MVC appealed against the decision of the High Court. The appeal washeard on 25 September 2004 and the Court of Appeal held that:(a)the appeal by MVC against the order of the High Court was allowed, and AT was onlyentitled to work done at the date of termination of the contract amounting toRM2,636,373.00 only;Page 16

(b)(c)as RM2,630,000.00 has already been paid to AT, it is only entitled to the balance sum ofRM6,373.00 plus interest from 11 May 1999 until payment is made to AT; andcosts of the proceedings in the High Court and in the Court of Appeal was awarded to MVC.The sum of RM6,373.00 plus interest was paid to AT’s solicitors on 8 October 2004.On 19 October 2004, AT has filed a civil application to the Federal Court of Malaysia seekingleave from the Federal Court to appeal against the Order of the Court of Appeal dated 25September 2004. The Federal Court, on 7 September 2005, granted AT leave to appeal.The solicitors of MVC are of the view that MVC has good prospects of success in the appeal.Nevertheless, as IGB has undertaken with MVC to bear all liabilities or losses of MVC under thislegal suit, the legal suit is not expected to have a material effect on the financial position of MVC.(ii)An action (Suit No. Kuala Lumpur High Court: S6-23-70-04) in defamation for loss of reputationand business was initiated by Shuib bin Hassan (practising under the name of Poliklinik danSurgeri Titiwangsa)(“Plaintiff”) against Cititel Hotel Management Sdn Bhd (“Cititel”) and two of itsemployees, Petrina P.F.Chong and Nor Ashikin binti Othman (collectively called “theDefendants”).The Plaintiff is seeking damages in the sum of RM50,000,000.00 or alternatively for damages tobe assessed by Court.The Writ of Summons for the action was served on Cititel and the two (2) other Defendants on 24December 2004. On 30 December 2004, an Appearance was filed by the Defendants and followedby the filing of Defence of the Defendants on 14 January 2005.The Solicitors of Cititel are of the opinion that Cititel has good prospects of success in defendingthe suit.(iii)On 9 September 2005 (Suit No. D8-22-1327-2005), IGB commenced action against BerjayaGroup Berhad (“Berjaya”) for breach of contract in respect of a sale and purchase agreementdated 26 July 1995 (the “SPA”) where IGB had sold Berjaya all its shares in Wangsa Tegap Sdn.Bhd. (“Wangsa Tegap”). IGB is seeking specific performance in relation to the granting of anoption under the SPA for development rights of a piece of land owned by Wangsa Tegap and, inthe alternative, damages to be assessed.IGB’s writ and statement of claim was served on 20 September 2005 and Berjaya filed and servedits Defence on 11 October 2005. The suit is presently fixed for case management.The solicitors of IGB are of the opinion that IGB has good prospects of success in the action.4. DOCUMENTS AVAILABLE FOR INSPECTIONCopies of the following documents are available for inspection during normal business hours at theRegistered Office of IGB at Penthouse, Menara IGB, No. 1, The Boulevard, Mid Valley City, LingkaranSyed Putra, 59200 Kuala Lumpur from the date of this Statement/Circular up to and including the date ofthe 42 nd AGM:i) Memorandum and Articles of Association of IGB;ii) Audited consolidated financial statements of IGB for the past two (2) financial years ended 31December 2004 and 31 December 2005;iii) Material contracts referred to in Section 2 of this Appendix; andiv) Relevant cause papers in respect of material litigation referred to in Section 3 of this Appendix.Page 17

EXTRACT OF ORDINARY RESOLUTIONSORDINARY RESOLUTIONPROPOSED RENEWAL OF SHARE BUY-BACK AUTHORITYTHAT, subject to the Companies Act, 1965 (“Act”), the provisions of the Company's Memorandum and Articlesof Association and the requirements of Bursa Malaysia Securities Berhad (“Bursa Securities”) and any otherrelevant authorities, and other relevant approvals, the Company be and is hereby authorised to purchase itsordinary shares of RM0.50 each (“IGB Shares”) on the market of Bursa Securities at any time upon such termsand conditions as the Directors in their absolute discretion deem fit and expedient in the interest of theCompany provided that:(i) the aggregate number of IGB Shares purchased does not exceed 10% of the issued and paid-up ordinaryshare capital of the Company at the time of purchase;(ii) the amount allocated for the purchase of IGB Shares shall not exceed the retained profits and sharepremium account of the Company based on the audited financial statements for the year ended 31December 2005; and(iii) the IGB Shares purchased are proposed to be cancelled and/or retained as treasury shares which may bedistributed as dividends, resold on Bursa Securities and/or cancelled.AND THAT such authority shall commence immediately upon passing of this ordinary resolution until:(i) the conclusion of the next Annual General Meeting of the Company, at which time it will lapse, unless by aresolution passed at that meeting, the authority is renewed;(ii) the expiration of the period within which the next Annual General Meeting of the Company is required tobe held pursuant to Section 143(1) of the Act (but shall not extend to such extension as may be allowedpursuant to Section 143(2) of the Act); or(iii) revoked or varied by a resolution passed by shareholders in a general meeting,whichever occurs first, but not so as to prejudice the completion of purchase(s) by the Company before theaforesaid expiry date and, in any event, in accordance with the provisions of the guidelines issued by BursaSecurities or any other relevant authorities.AND THAT the Directors of the Company be and are hereby authorised to complete and do all such acts andthings as they may consider expedient or necessary to give full effect to the Proposed Renewal of Share Buy-Back Authority.Page 18

EXTRACT OF ORDINARY RESOLUTIONSORDINARY RESOLUTIONPROPOSED SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF AREVENUE OR TRADING NATURETHAT, approval be and is hereby given to the Company and its subsidiaries (the “Group”) to enter into andgive effect to specified recurrent transactions of a revenue or trading nature and with specified classes ofrelated parties as stated in Section 2.2.2 of the Circular to Shareholders dated 28 April 2006, which arenecessary for the Group’s day-to-day operations subject to the following:(i) the transactions are in the ordinary course of business and are on terms not more favourable to therelated parties than those generally available to the public where applicable and are not to the detrimentof the minority shareholders; and(ii) disclosure is made in the annual report of the aggregate value of transactions conducted pursuant to theshareholders’ mandate during the financial year and such approval shall continue to be in force until:(a) the conclusion of the next Annual General Meeting of the Company, at which time it will lapse, unlessby a resolution passed at that meeting, the authority is renewed;(b) the expiration of the period within which the next Annual General Meeting of the Company is requiredto be held pursuant to Section 143(1) of the Companies Act, 1965 (“Act”) (but shall not extend to suchextension as may be allowed pursuant to Section 143(2) of the Act); or(c) revoked or varied by a resolution passed by shareholders in a general meeting,whichever is earlier.AND THAT the Directors of the Company be and are hereby authorised to complete and do all such acts andthings as they may consider expedient or necessary to give full effect to the transactions contemplated and/orauthorised by this resolution.Page 19