EASYKNIT INTERNATIONAL HOLDINGS LIMITED


(Incorporated in Bermuda with limited liability)
(Stock Code: 1218)
DISCLOSEABLE TRANSACTION

Full acceptance of provisional allotment
under the 2 for 1 Rights Issue of Easyknit Enterprises
The board of Easyknit Enterprises announced on 6 December 2007 that it proposes
to raise approximately HK$102.1 million before expense by way of the Rights
Issue of 1,963,537,620 Rights Shares at a price of HK$0.052 per Rights Share
payable in full on acceptance.
At the date of this announcement, the Company, through Landmark Profits, is
interested in 1,410,852,520 Shares, representing approximately 35.9% of the total
issued share capital of Easyknit Enterprises. Landmark Profits has irrevocably
undertaken to Easyknit Enterprises and the Underwriter that, inter alia, it will
accept its allotment of a total of 705,426,260 Rights Shares under the Rights Issue.
As the amount of consideration of HK$36,682,165.52 to be paid by the Company
through Landmark Profits for the 705,426,260 Rights Shares under the provisional
allotment of the Rights Issue exceeds 5% but is less than 25% of one of the
applicable ratios of the Company under the Listing Rules, the transaction
constitutes a discloseable transaction of the Company under rule 14.06(2) of the
Listing Rules. A circular providing the information required under the Listing
Rules will be despatched to shareholders in due course.
PROPOSED RIGHTS ISSUE

The board of Easyknit Enterprises announced on 6 December 2007 that it proposes
to raise approximately HK$102.1 million before expenses by way of the Rights Issue
of 1,963,537,620 Rights Shares at a price of HK$0.052 per Rights Share payable in
full on acceptance. Further details in relation to the Rights Issue and the valuation of
the Rights Shares have been set out in the Announcement.
—1—

UNDERTAKING AND UNDERWRITING ARRANGEMENT
At the date of this announcement, the Company, through Landmark Profits, is
interested in 1,410,852,520 Shares, representing approximately 35.9% of the total
issued share capital of Easyknit Enterprises. Landmark Profits has irrevocably
undertaken to Easyknit Enterprises and the Underwriter that the Shares beneficially
owned by it will not be disposed of or transferred from the date of the undertaking,
being the date of the Underwriting Agreement, to the Record Date and that the Rights
Shares to be allotted in respect of those Shares will be taken up in full, representing
705,426,260 Rights Shares. On the basis of HK$0.052 per Rights Share, the total
consideration to be paid by the Company through Landmark Profits for the
705,426,260 Rights Shares amounts to HK$36,682,165.52 and will be satisfied by
payment in cash from internal resources of the Company. Landmark Profits will not
apply for any excess Rights Shares under the Rights Issue.
The Underwriting Agreement was entered into between Easyknit Enterprises and the
Underwriter pursuant to which the Underwriter has agreed to fully underwrite the
1,258,111,360 Rights Shares (being all the 1,963,537,620 Rights Shares under the
Rights Issue less the 705,426,260 Rights Shares to be issued to and accepted by
Landmark Profits). The Underwriter and its ultimate controlling shareholder do not
have any shareholdings in either the Company or Easyknit Enterprises and each is an
independent third party not connected with the Company, Easyknit Enterprises, the
directors, chief executive or substantial shareholders of the Company or Easyknit
Enterprises or any of their respective subsidiaries and associates. Further details in
relation to the Underwriter Agreement have been set out in the Announcement.
REASONS FOR FULL ACCEPTANCE OF THE RIGHTS ISSUE

The Company carries on the principal businesses of garment sourcing and export,
property investment and development, investment in securities and loan financing.
The Directors consider that the full acceptance by the Company of it provisional
allotment under the Rights Issue will allow the Company, through Landmark Profits,
to maintain its pro rata shareholding in Easyknit Enterprises. On this basis, the
Directors consider that it is fair and reasonable and in the interests of the
shareholders of the Company as a whole.
INFORMATION ON EASYKNIT ENTERPRISES

Easyknit Enterprises and its subsidiaries are principally engaged in the bleaching and
dyeing and knitting business.
— 2 —

Based on the interim report of Easyknit Enterprises for the six months ended 30
September 2007, the unaudited net asset value of the Group was approximately
HK$158,646,000. The net asset value per Share based on this unaudited net asset
value and 3,927,075,240 Shares in issue as at 30 September 2007 was HK$0.040. The
closing price per Share as quoted on the Stock Exchange on the Last Trading Day was
HK$0.087.
According to the annual report of Easyknit Enterprises for the year ended 31 March
2007, the Group’s net loss (before and after taxation and extraordinary items) were
approximately HK$9,909,000 and HK$11,481,300 respectively. According to the
annual report of Easyknit Enterprises for the year ended 31 March 2006, the Group’s
net loss (before and after taxation and extraordinary items) was approximately
HK$32,857,000.
GENERAL

As the amount of consideration of HK$36,682,165.52 to be paid by the Company
through Landmark Profits for the 705,426,260 Rights Shares under the provisional
allotment of the Rights Issue exceeds 5% but is less than 25% of one of the applicable
ratios of the Company under the Listing Rules, the transaction constitutes a
discloseable transaction of the Company under rule 14.06(2) of the Listing Rules. A
circular providing the information required under the Listing Rules will be
despatched to shareholders in due course.
TERMS USED IN THIS ANNOUNCEMENT

In this announcement the following terms have the meanings set opposite them
below.
“Announcement” the announcement of Easyknit Enterprises dated 6
December 2007 relating to the Rights Issue
“associate(s)” the meaning ascribed thereto in the Listing Rules
“Company” Easyknit International Holdings Limited, a company
incorporated in Bermuda with limited liability, the
issued shares of which are listed on the Stock Exchange
“Directors” the directors of the Company
“Easyknit Enterprises” Easyknit Enterprises Holdings Limited, a company
incorporated in Bermuda with limited liability, the
issued shares of which are listed on the Stock Exchange
— 3 —

“HK$” Hong Kong dollars, the lawful currency of Hong Kong
“Group” Easyknit Enterprises and its subsidiaries
“Hong Kong” Hong Kong Special Administrative Region
“Landmark Profits” Landmark Profits Limited, a company incorporated in
the British Virgin Islands with limited liability and a
wholly owned subsidiary of the Company, is a 35.9%
controlling shareholder of Easyknit Enterprises
“Last Trading Day” 28 November 2007, being the last trading day before the
suspension of the trading in the Shares pending the
issue of the Announcement
“Listing Rules” the Rules Governing the Listing of Securities on the
Stock Exchange
“Record Date” 28 December 2007
“Rights Issue” the issue by way of rights of one Rights Share for every
two Shares held on the Record Date at a price of
HK$0.052 per Rights Share
“Rights Share(s)” 1,963,537,620 Share(s) to be issued and allotted under
the Rights Issue
“SFO” The Securities and Futures Ordinance (Chapter 571 of
the Laws of Hong Kong)
“Share(s)” ordinary share(s) of HK$0.01 each in the share capital
of Easyknit Enterprises
“Stock Exchange” the Stock Exchange of Hong Kong Limited
“Underwriter” Kingston Securities Limited, a corporation licensed to
carry out business in type 1 (dealing in securities)
regulated activities under the SFO, which is neither a
connected person (as defined in the Listing Rules) of
the Company or Easyknit Enterprises
— 4 —

“Underwriting
Agreement”
the underwriting agreement dated 29 November 2007
entered into between Easyknit Enterprises and the
Underwriter in relation to the underwriting and certain
other arrangements in respect of the Rights Issue
For and on behalf of
Easyknit International Holdings Limited
Tse Wing Chiu, Ricky
President and Chief Executive Officer
As at the date of this announcement, the Board comprises Mr. Tse Wing Chiu, Ricky,
Ms. Lui Yuk Chu and Mr. Kwong Jimmy Cheung Tim as executive directors and Mr.
Wong Sui Wah, Michael, Mr. Tsui Chun Kong and Mr. Jong Koon Sang as
independent non-executive directors.
Hong Kong, 17 December, 2007
— 5 —