Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

ANNOUNCEMENT UPDATE ON STEPS TAKEN TO ADDRESS PUBLIC FLOAT

This announcement is made on a voluntary basis to update shareholders relating to the public float issue and pursuant to Rule 3.7 of The Hong Kong Code on Takeovers and Mergers (the Takeovers Code).
Reference is made to the Company's announcements dated 17 January 2013, 7 February 2013, 25
February 2013, 6 March 2013, 10 May 2013, 17 June 2013, 12 July 2013, 13 August 2013, 17
September 2013, 25 October 2013, 29 November 2013 and 8 January 2014 regarding the status of the Company's public float and trading suspension (the Announcements). Unless otherwise defined herein, all capitalized terms used herein shall have the same meanings as adopted in the Announcements.
The Board wishes to update shareholders on the latest development and progress on the steps taken to address the public float. Despite that the Company had endeavored to identify ways to restore its public float to 25%, the Company has been unable to make further progress with the proposals previously considered by the Board (the Previous Proposals) due to the fact it had not received any indication of support from its substantial shareholders essential for implementation thereof.
A special board meeting was held on 20 Jan 2014 to further discuss and explore appropriate methods to resolve the public float issue. Apart from the proposals to restore public float to 25%, the Board also considered and assessed other reasonable options that might not restore the public float but would put an end to the impasse. The following proposals, presented in the order of Board's preference (the Latest Proposals), were discussed during that meeting:
(i) Each of the substantial shareholders, namely, Silchester and KML (together, the Substantial Shareholders), to sell down their shares proportionally to restore the public float coupled with undertakings not to acquire further shares from the secondary market for a certain period of time (Proposal 1);
(ii) Delisting of the shares of the Company from the Stock Exchange (the Delisting) with the exit cash offer to be made by one of the Substantial Shareholders to all other shareholders (Proposal 2); or
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(iii) Delisting proposal with the exit cash offer to be made by the Company which may be made by share buy-backs by general offer (Proposal 3).
Pursuant to the Listing Rules, as both Proposal 2 and Proposal 3 involve voluntary withdrawal of listing, they are subject to shareholders' approval at a duly convened general meeting (the SGM) at which any controlling shareholders and their respective associates must abstain from voting. As such, KML may not be able to vote at such SGM, if so convened, for considering and approving Proposal 2 or Proposal 3. Further, both Proposal 2 and Proposal 3, if implemented, will also be subject to (i) compliance with all applicable laws and regulations including the Bermuda statutes, the Listing Rules, the Takeovers Code and/or the Code on Share Buy-backs (the Share Buy-backs Code, together with the Takeovers Code, the HK Codes) and (ii) approval of the relevant regulatory authorities, including the Stock Exchange and the Securities and Futures Commission.
Pursuant to the HK Codes, Proposal 3 (if implemented) will entail the establishment of an independent board committee (the IBC) to make recommendations as to the fairness and reasonableness of the offer and as to acceptance and/or voting. An independent financial adviser (the IFA) will be appointed to advise the IBC in writing on the same and the IFA's written advice (the IFA Opinion) will be included in the board circular (the Board Circular) of the Company required to be dispatched to shareholders upon implementation of Proposal 3.
Similar to the Previous Proposals, the Latest Proposals also require the co-operation and/or support from the Substantial Shareholders for implementation. Accordingly, in late January 2014, the Company wrote to the Substantial Shareholders to seek their views and support for the Latest Proposals. The Company also offered to engage in further dialogue and discussion with the Substantial Shareholders on the Latest Proposals as well as any other alternatives which they may find acceptable with a view to assisting the Board in assessing the situation and deciding the best way forward.
KML replied to the Company indicating that it did not accept Proposal 1 and neither was it prepared to commit to making a general offer as contemplated under Proposal 2. KML expressed no comment on Proposal 3 as it is subject to independent shareholders' approval. Silchester indicated that it was not prepared to support or participate in any of the Latest Proposals until such time when the Company's assets are transparently priced and fully valued.
In light of the responses from the Substantial Shareholders to the Latest Proposals, Proposal 3 appears to be the only route (as amongst the latest Proposals) that the Company may consider pursuing as it involves primarily a corporate action that could be initiated by the Company itself and it can be put to the SGM for voting by independent Shareholders.
A special board meeting was held on 25 February 2014 to consider and discuss on Proposal 3 as a means for resolving the public float issue. The Board noted that although Proposal 3 (if implemented and carried out) could not restore the public float to 25%, it would at least offer an opportunity for Shareholders to exit from the Company (whose shares have been suspended from trading since February 2013) and put an end to the current impasse. Further, the Board considered that the relevant documentation and regulatory procedures (such as inclusion of IFA Opinion in the Board Circular and the convening of SGM) required for implementing Proposal 3 under the HK Codes and the Listing Rules would assist the Shareholders in making an informed decision regarding their acceptance(s) and/or voting and afford Shareholders a forum to air their views and participate in the voting process.
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Hence, the Board considered it appropriate to take Proposal 3 as a potential viable route for resolving the public float issue and to initiate the necessary preparatory steps and procedures in connection with the potential implementation of Proposal 3. At the same time, the Company is assessing the financial implications if Proposal 3 is implemented and the need for any financing arrangements for that purpose. Any exit cash offer under Proposal 3 would be made by the Company at an appropriate price which properly reflects the value of the Company's business and assets.
Accordingly, the Company will initiate discussions and consultation with the regulators to seek guidance and clearance on compliance aspects under the various regulatory regimes applicable to Proposal 3 and seek professional advice on the applicable regulatory regimes and the steps and procedures for potential implementation of Proposal 3. As Proposal 3 is subject to various regulatory regimes (in particular the HK Codes) and due to complexity of the subject matter, the process of seeking guidance and approval from the regulators and taking the preparatory steps and procedures as required by the applicable laws, rules and regulations in connection with Proposal 3 may take considerable time.

In compliance with Rule 3.7 of the Takeovers Code, monthly announcement(s) setting out the progress of the aforesaid discussions and consultations, and the preparatory steps and procedures required, in respect of Proposal 3 will be made until announcement of a firm intention by the Company to implement Proposal 3 and make an offer under Rule 3.5 of the Takeovers Code or of a decision by the Company not to proceed with Proposal 3 is made. Further announcement(s) will be made by the Company as and when appropriate or as required in accordance with the Listing Rules and the HK Codes (as the case may be) on the status and progress in connection with the potential implementation of Proposal 3.

In compliance with Rule 3.8 of the Takeovers Code, the relevant securities of the Company comprised 1,561,057,596 shares in issue and 6,988,000 outstanding options as at the date of this announcement, and the Company has no other relevant securities (as defined in Note 4 to Rule 22 of the Takeovers Code) as at the date hereof.

The associates of the Company (as defined in the HK Codes and including Shareholders of the Company having interests of 5% or more in the relevant securities of the Company) are hereby reminded to disclose their dealings in any securities of the Company under Rule 22 of the Takeovers Code.

In accordance with Rule 3.8 of the Takeovers Code, reproduced below is the full text of Note 11 to

Rule 22 of the Takeovers Code:

"11. Responsibilities of stockbrokers, banks and other intermediaries

Stockbrokers, banks and others who deal in relevant securities on behalf of clients have a general duty to ensure, so far as they are able, that those clients are aware of the disclosure obligations attaching to associates and other persons under Rule 22 and that those clients are willing to comply with them. Principal traders and dealers who deal directly with investors should, in appropriate cases, likewise draw attention to the relevant Rules. However, this does not apply when the total value of dealings (excluding stamp duty and commission) in any relevant security undertaken for a client during any 7 day period is less than $1 million.

This dispensation does not alter the obligation of principals, associates and other persons themselves to initiate disclosure of their own dealings, whatever total value is involved.

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Intermediaries are expected to co-operate with the Executive in its dealings enquiries. Therefore, those who deal in relevant securities should appreciate that stockbrokers and other intermediaries will supply the Executive with relevant information as to those dealings, including identities of clients, as part of that co-operation."

"Executive" in the above has the meaning ascribed to it under the Takeovers Code.

Shareholders of the Company and potential investors should take note that Proposal 3 is only a potential viable option that the Board has decided to pursue and is still at a preliminary stage. Shareholders should note that there is no certainty or assurance whatsoever that Proposal 3 will eventually be carried out as it is still being assessed internally with assistance of professional advisers and is subject to clearance(s) by the relevant regulatory bodies on the feasibility, compliance with the applicable regulatory regimes and independent Shareholder approval, which may or may not lead to a share buy- back by general offer.

Hong Kong, 9 May 2014

As at the date hereof, the Board comprises:

On behalf of the Board

SCMP Group Limited David J. Pang

Chairman

Non-executive Directors

Dr. David J. Pang (Chairman), Mr. Roberto V. Ongpin (Deputy Chairman)
and Tan Sri Dr. Khoo Kay Peng

Independent Non-executive Directors

Mr. Ronald J. Arculli, Dr. Fred Hu Zu Liu, Dr. the Hon. Sir David Li Kwok Po and Mr. Wong Kai Man

Executive Director

Ms. Kuok Hui Kwong

All the directors of the Company jointly and severally accept full responsibility for the accuracy of information contained in this announcement and confirm, having made all reasonable inquiries, that to the best of their knowledge, opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.

* For identification purpose only

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