On May 18 2009, Shanghai Shimao Co., Ltd (600823.SH) and Shimao Property Holdings Limited (0813.HK) announced that Shimao Property has injected assets into Shanghai Shimao and Shanghai Shimao has issued new share to Shimao Property successfully.

Shimai Property successfully injected 100% equity of 9 commercial real estate companies, Beijing Shimao Tower and approximately RMB750 million cash to Shanghai Shimao according to the restructuring plan. Transfer of the abovementioned assets and the relevant procedure has been completed on May 8 2009. On May 13 2009, Shanghai Shimao completed the issuance of 692,240,000 shares to three designated parties, including Peak Gain International Limited, Beijing Shimao Investment and Development Co., Ltd and Shanghai Shimao Enterprises Development Co., Ltd. The relevant registration and related procedures have also been completed.

Through this directional add-issuance, Shanghai Shimao will get premium commercial sites with a total floor are of more than 4 million sq.m. and RMB750 million cash, becoming one of the largest listed commercial property developers in mainland China. The total assets and net assets of Shanghai Shimao have been sharply raised. Its financial structure is more reasonable with anti-risk capability enhanced. Meanwhile, after Shanghai Shimao becomes the holding subsidiaries of Shimao Property, the advantage and experience in business management, technical personnel, and risk control of Shimao Property will benefit Shanghai Shimao and will lay a good foundation for long-term development in the future.

Mr. Hui Wing Mau, Chairman of Shimao Group said regarding the completion of restructuring plan of the two companies: Shimao Property will focus its financial and management resources on the development of domestic fast-growing residential and hotel business to grasp the opportunities brought by 2010 Shanghai World Expo and the sustainable development of domestic economy; while Shanghai Shimao will contribute to the development of commercial property projects. We will actively raise the management standards and strengthen the competition advantage of the Group to promote the long-term and stable development of the company, continuing to make more fruitful return for shareholders.