Disposal

RNS Number:4016X
Guangdong Development Fund Ld
30 May 2007


Guangdong Development Fund Limited
Disposal
30 May 2007



Guangdong Development Fund Limited ("the Fund") announces that GDF (Heyuan)
Limited ("GDF Heyuan"), a wholly-owned subsidiary of the Fund, had signed a
conditional sales agreement ("Sales Agreement") for the disposal of its 24.24%
equity interest in Guangdong Heyuan Tong Hua Investment Limited ("Tong Hua") to
Heyuan Communication Group Limited Company, the Chinese Party of Tong Hua, for a
consideration of RMB4 million (approximately US$0.52 million) payable in cash.
The Sales Agreement is subject to the approval of the relevant authorities of
the Chinese government.


Tong Hua operates a toll road at Heyuan City in Guangdong Province. The total
initial investment in Tong Hua made by GDF Heyuan was US$4.84 million and the
total investment income received by the Fund from the date of investment up to
the date of this announcement was US$7.62 million. The carrying value of the
Fund's investment in Tong Hua is US$0.26 million as at 31 December 2006,
representing 1.20% of the audited net asset value of the Fund as at 31 December
2006. The Fund expects that the transaction will recognise a realised gain of
approximately US$0.26 million from the disposal in its financial statements for
the year ending 31 December 2007.


The decision of the transaction was made in line with the resolution, passed at
the Extraordinary General Meeting of the Fund held on 23 February 2001, of
disposing of all or alternatively, substantially all of the investment portfolio
of the Fund in a timely and orderly fashion and distributing the net proceeds of
such disposals to the shareholders.


The net cash proceeds from the disposal is denominated in Renminbi ("RMB"),
which, until converted into United States dollars ("USD"), is not available for
distribution to shareholders. The Fund will take necessary steps to convert the
RMB proceeds into USD; however this process can be lengthy and uncertain. Only
when converted into USD and after the Fund taking into consideration its
available cash on hand, the disposal proceeds will be distributed among
shareholders of the Fund.


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