Acquisition

RNS Number:2948O
Cathay International Holdings Ld
04 August 2003

Date: 4 August 2003

Cathay International Holdings Limited

Cathay International Holdings Limited ("Cathay") announces a USD 550,000
investment in Tianjin Longbai Biological Engineering and Technology Company
Limited ("Longbai"), a pharmaceutical and biotechnology equity joint venture
company based in Tianjin City in the north of the People's Republic of China 
("China").  This second investment by Cathay in the biotechnology and
pharmaceutical sector in China is made with industry professionals from China
led by Dr. Liu Hui.

Longbai researches and develops technology concerning novel drug delivery
formats, focusing on oral fast release drugs.  The company is developing a
technology to facilitate drug absorption within thirty seconds of oral intake.
This will significantly reduce the amount of time required for drugs to become
effective, compared to the two to four hours of time often required for drugs to
be absorbed through the stomach.  This technology platform can be applied across
a wide range of drugs, especially for diseases with acute symptoms.

Longbai already has one product approved for clinical trials in China, and has
eight other products expected to be ready for clinical trials within twelve
months. Longbai is expected to generate revenue by first transferring and/or
licensing know-how and technology to other pharmaceutical companies.

On 30th June 2003, subsidiary companies of Cathay entered into agreements to
acquire equity in Longbai resulting in a 70.0% interest for a total
consideration of RMB 4,550,000 (USD 550,000).   One of the subsidiary companies
involved is Cathay International Changchun Biotechnology and Pharmaceutical
Limited ("Cathay Changchun"), a joint venture recently formed by Cathay.   For
further details regarding Cathay Changchun, please see the Company's
announcement dated 26th June 2003.  The agreements were subject to certain
conditions precedent, which have now been fulfilled, and the approval of the
board of directors of Cathay, which has now been given. Cathay will finance the
investment from existing cash resources.

Cathay expects to make further investments in the biotechnology and
pharmaceutical industry in China, and will make announcements at the appropriate
time.

Enquiries to:

Cathay International Holdings Limited
25/F Standard Chartered Bank Building
4-4A Des Voeux Road Central
Central District
Hong Kong

Attention: Stephen Hunt, Director

Tel: + 852 2828 9289
Background Note:

Dr. Liu Hui holds Master and Ph.D. degrees in Medical and Biological Sciences
from Montana University, USA. He was also a post-doctoral research fellow at
McGill University, Canada.  Dr. Liu established Longbai in 2001, has been
instrumental in developing its core technology and will be the General Manager
of Longbai.


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