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This announcement appears for information purposes only and does not constitute an invitation or offer
to acquire, purchase or subscribe for securities of the Company.
(Incorporated in Bermuda with limited liability)
(Stock Code: 632)
CONNECTED TRANSACTION –
SUBSCRIPTION FOR NEW SHARES
WHITEWASH WAIVER APPLICATION
PROPOSED INCREASE IN AUTHORIZED SHARE CAPITAL
CHANGE OF FINANCIAL YEAR END DATE

AND
RESUMPTION OF TRADING

Financial Adviser to the Company
THE SUBSCRIPTION

On 3 December 2007, the Company entered into the Agreement with the Subscriber, pursuant to which,
the Subscriber conditionally agreed to subscribe for and the Company conditionally agreed to issue
77,456,000 Subscription Shares at a price of HK$.00 per Subscription Share.
The Subscriber is a substantial Shareholder. Accordingly, the Subscription constitutes a connected
transaction for the Company under the Listing Rules. Completion of the Agreement is therefore subject
to, among other things, approval of the Independent Shareholders by way of poll at the SGM. The
Subscriber and its associates shall abstain from voting at the SGM in respect of the Subscription.

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WHITEWASH WAIVER

Assuming no further Shares will be issued by the Company prior to the completion of the Subscription,
upon completion of the Agreement, the interests held by the Subscriber and parties acting in concert with
it will increase from 46.53% to 55.45% of the issued share capital of the Company as enlarged by the
issue of the Subscription Shares. The Subscriber and parties acting in concert with it will, in the absence
of the Whitewash Waiver, be obliged to make a mandatory general offer for all the Shares not already
owned or agreed to be acquired by them pursuant to Rule 26 of the Takeovers Code as a result of the
completion of the Subscription. The Subscriber will apply to the Executive for the Whitewash Waiver
pursuant to Note of the Notes on Dispensation from Rule 26 of the Takeovers Code. The Whitewash
Waiver shall be subject to the approval by the Independent Shareholders at the SGM on a vote taken
by way of a poll whereby the Subscriber, its associates and concert parties will abstain from voting in
respect of the Whitewash Waiver.
PROPOSED INCREASE IN AUTHORIZED SHARE CAPITAL

The Company proposes to increase its authorized share capital from HK$300,000,000 divided into
600,000,000 Shares of HK$0.5 each to HK$3,000,000,000 divided into 6,000,000,000 Shares of HK$0.5
each by the creation of an additional 5,400,000,000 unissued Shares.
CHANGE OF FINANCIAL YEAR END DATE

The Board also announces that the financial year end date of the Company has been changed from 3
March to 3 December with immediate effect.
GENERAL

An Independent Board Committee has been formed to advise the Independent Shareholders on the
Subscription and the Whitewash Waiver and the Independent Board Committee has approved the
appointment of Wallbanck Brothers Securities (Hong Kong) Limited as the independent financial adviser
to advise the Independent Board Committee and the Independent Shareholders on the Subscription and
the Whitewash Waiver in accordance with the Listing Rules and Takeovers Code.
A circular containing, among other things, further details of the Subscription, the Whitewash Waiver
and the proposed increase in authorized share capital of the Company, the letter from the Independent
Board Committee and the recommendation from the independent financial adviser on the terms of the
Subscription and the Whitewash Waiver, together with a notice convening the SGM, will be dispatched
to the Shareholders as soon as practicable.
RESUMPTION OF TRADING

At the request of the Company, trading in the Shares on the Stock Exchange has been suspended from
9:30 a.m. on 2 January 2008 pending the release of this announcement. Application has been made to
the Stock Exchange for the resumption of trading in the Shares on the Stock Exchange from 9:30 a.m.
on 3 January 2008.

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SHARE SUBSCRIPTION AGREEMENT

Date
3 December 2007
Parties involved
The Company as the issuer and the Subscriber as the subscriber. The Subscriber, a company wholly-
owned by Mr. Wong Kwan, Chairman and Chief Executive of the Company and an executive Director, is
a substantial Shareholder holding approximately 46.53% of the issued share capital of the Company as at
the date of this announcement.
Subscription Price
HK$.00 per Subscription Share. The aggregate Subscription Price of HK$77,456,000 shall be payable in
cash upon completion of the Agreement. The Subscription Price was agreed after arm’s length negotiations
with reference primarily to the recent market prices of the Shares and represents (i) a discount of
approximately .96% to the closing price of HK$.020 per Share as quoted on the Stock Exchange on the
Last Trading Day; (ii) no discount/premium to/over the average closing price of approximately HK$.000
per Share as quoted on the Stock Exchange for the last five trading days up to and including the Last
Trading Day; and (iii) a discount of approximately .28% to the average closing price of approximately
HK$.03 per Share as quoted on the Stock Exchange for the last ten trading days up to and including
the Last Trading Day.
Number of Subscription Shares
The number of Subscription Shares is 77,456,000, representing 20.00% of the existing share capital of
the Company and approximately 6.67% of the share capital of the Company as enlarged by the issue of
the Subscription Shares.
Ranking of Subscription Shares
The Subscription Shares, when issued and fully paid, will rank pari passu among themselves and with
Shares in issue at the time of issue and allotment of the Subscription Shares.
The Subscription Shares
The Subscription Shares will be issued under a special mandate to be considered by the Independent
Shareholders in the SGM. Application will be made by the Company to the Listing Committee of the Stock
Exchange for the grant of the listing of, and permission to deal in, the Subscription Shares.

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Conditions of the Agreement
The Agreement is conditional upon, among other things:
(i) the Listing Committee of the Stock Exchange granting the listing of, and permission to deal in, the
Subscription Shares;
(ii) the Independent Shareholders in a special general meeting to be held approving the Agreement
and the issue and allotment of the Subscription Shares to the Subscriber pursuant to the terms and
conditions of the Agreement; and
(iii) the Executive granting the Whitewash Waiver to the Subscriber under the Takeovers Code pursuant
to the terms of the Agreement.
The above conditions cannot be waived by the parties to the Agreement. In the event that the conditions
to the Agreement are not fulfilled by 3 March 2008 or such later date as may be agreed between the
Company and the Subscriber, the obligations and liabilities of the Subscriber and the Company under
the Subscription shall be null and void and neither the Company nor the Subscriber shall have any claim
against the other for costs, damages, compensation or otherwise provided that the Company shall reimburse
the Subscriber any legal fees and out-of-pocket expenses which the Subscriber shall be obliged to pay in
connection with the Subscription.
REASONS FOR THE SUBSCRIPTION AND USE OF PROCEEDS

The Company intends to apply the net proceeds of the Subscription of approximately HK$77 million for
general working capital of the Group. The Directors (excluding the independent non-executive Directors
who will express their views after receiving advice from the independent financial adviser) consider that
the Subscription is in the interest of the Company and the Shareholders as a whole as it will broaden the
capital base of the Company and improve the financial position of the Group by increasing both the current
assets and capital of the Company by an amount of approximately HK$77 million.
LISTING RULES IMPLICATIONS

The Subscriber is a substantial Shareholder. Therefore, the Subscription constitutes a connected transaction
for the Company under the Listing Rules and is subject to, among other things, approval of the Independent
Shareholders by way of poll at the SGM. The Subscriber, namely Orient Day Developments Limited, and
its associates shall abstain from voting in respect of the Subscription.
APPLICATION FOR WHITEWASH WAIVER

Assuming no further Shares will be issued by the Company prior to the completion of the Subscription,
upon completion of the Agreement, the interests held by the Subscriber and parties acting in concert with
it will increase from 46.53% to 55.45% of the issued share capital of the Company as enlarged by the issue
of the Subscription Shares. The Subscriber and parties acting in concert with it will, in the absence of the

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Whitewash Waiver, be obliged to make a mandatory general offer for all the Shares not already owned or
agreed to be acquired by them pursuant to Rule 26 of the Takeovers Code as a result of the completion
of the Subscription. The Subscriber will apply to the Executive for the Whitewash Waiver pursuant to
Note of the Notes on Dispensation from Rule 26 of the Takeovers Code. The Whitewash Waiver shall
be subject to the approval by the Independent Shareholders at the SGM on a vote taken by way of a poll
whereby the Subscriber, Mr. Wong and their respective associates and concert parties will abstain from
voting in respect of the Whitewash Waiver.
There are no dealings in the securities of the Company by the Subscriber, Mr. Wong and their respective
concert parties during the six months prior to the date of this announcement and including the date of this
announcement. Except as disclosed in the section headed “Effects on Shareholding” below, the Subscriber
and its concert parties do not hold any other securities, or derivatives in respect of the securities in the
Company.
EFFECTS ON SHAREHOLDING

The effects of the Subscription on the shareholding of the Company are shown as follows:
Shareholding upon
Shareholding as at the completion of the
date of this announcement Agreement
(No. of Shares) (%) (No. of Shares) (%)
The Subscriber, Mr. Wong and
their concert parties (Note) 80,28,800 46.53 257,674,800 55.45
Public shareholders 207,063,60 53.47 207,063,60 44.55

Total 387,28,960 00.00 464,737,960 00.00

Note: The Subscriber is wholly and beneficially owned by Mr. Wong Kwan, Chairman and Chief Executive of the
Company and an executive Director.
FUND RAISING ACTIVITIES IN THE PAST TWELVE MONTHS

The Company has not conducted any fund raising activities in the past twelve months before the date of this
announcement, except the issue of new Shares as set out in the Company’s announcement dated 5 March
2007 in relation to the top-up placing of 29,500,000 new Shares of HK$0.5 each at the price of HK$2.59
per Share by the Company (the “Issue”). The net proceeds of the Issue of approximately HK$74.5 million
in total have been applied towards the general working capital of the Group as originally planned.

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PROPOSED INCREASE IN AUTHORIZED SHARE CAPITAL

As at the date of this announcement, the authorized share capital of the Company is HK$300,000,000
divided into 600,000,000 Shares, of which 387,28,960 Shares have been issued and fully paid or credited
as fully paid. In order to provide the Group with flexibility in its future expansion and growth by means
of issuing new Shares and fund-raising activities as the Directors may consider appropriate from time to
time, the Directors propose to increase the authorized share capital of the Company to HK$3,000,000,000
divided into 6,000,000,000 Shares by the creation of an additional 5,400,000,000 unissued Shares. The
increase in the authorized share capital of the Company is conditional upon the passing of an ordinary
resolution by the Shareholders at the SGM and no Shareholders are required to abstain from voting for
such resolution.
CHANGE OF FINANCIAL YEAR END DATE

The Board also announces that the financial year end date of the Company has been changed from 3
March to 3 December with immediate effect.
The latest annual report of the Company containing the audited consolidated accounts of the Group for
the financial year ended 3 March 2007 was issued on 27 July 2007. The interim report of the Company
containing the unaudited consolidated accounts of the Group for the six months ended 30 September 2007
was issued on 20 December 2007. The Company’s forthcoming financial results and reports for the period
ended 3 December 2007 will be released as follows:–
The announcement containing the audited results of the Group for the nine months ended 3 December
2007 and the relevant annual report of the Company containing the audited accounts for the same period
will be published and dispatched to the Shareholders on or before 30 April 2008. The audited financial
statements for the twelve months ended 3 March 2007 will be disclosed as the comparative figures for
the financial statements for the nine months ended 3 December 2007.
The Board considers that the change of the Company’s financial year end date will enable the Company to
have the same financial year end date as that of its major operating subsidiaries and associated companies
engaged in the businesses of energy, natural resources and logistics, and such change will be beneficial
to the operations of the Group.
The Company does not expect there will be any material financial impact on the Company after the change
of financial year end date.
GENERAL

An Independent Board Committee has been formed to advise the Independent Shareholders on the
Subscription and the Whitewash Waiver and the Independent Board Committee has approved the
appointment of Wallbanck Brothers Securities (Hong Kong) Limited as the independent financial adviser
to advise the Independent Board Committee and the Independent Shareholders on the Subscription and
the Whitewash Waiver in accordance with the Listing Rules and Takeovers Code.

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A circular containing, among other things, further details of the Subscription, the Whitewash Waiver
and the proposed increase in authorized share capital, the letter from the Independent Board Committee
and the recommendation from the independent financial adviser on the terms of the Subscription and the
Whitewash Waiver, together with a notice convening the SGM will be dispatched to the Shareholders as
soon as practicable.
RESUMPTION OF TRADING

At the request of the Company, trading in the Shares on the Stock Exchange has been suspended from
9:30 a.m. on 2 January 2008 pending the release of this announcement. Application has been made to the
Stock Exchange for the resumption of trading in the Shares on the Stock Exchange from 9:30 a.m. on
3 January 2008.
DEFINITIONS

In this announcement, unless the context otherwise requires, the following expressions have the following
meanings:
“Agreement” a share subscription agreement between the Company and the Subscriber
dated 3 December 2007 in relation to the Subscription
“associate(s)” has the meaning ascribed thereto under the Listing Rules
“Board” the board of Directors
“Company” Pearl Oriental Innovation Limited, a company incorporated in Bermuda
with limited liability and the shares of which are listed on the Stock
Exchange
“connected person(s)” has the meaning ascribed thereto under the Listing Rules
“Director(s)” director(s) of the board of the Company
“Executive” the Executive Director of the Corporate Finance Division of the SFC
or any delegate of the Executive Director
“Group” the Company and its subsidiaries
“HK$” Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong” Hong Kong Special Administrative Region of the PRC
“Independent Board an independent board committee of the Board comprising all the
Committee” independent non-executive Directors, namely Dr. Dong Zhixiong, Mr.
Fung Hing Chiu, Cyril and Mr. Lai Shi Hong, Edward

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“Independent Shareholders” Shareholders (other than the Subscriber, Mr. Wong and their respective
concert parties and associates and those Shareholders who are involved
in, or interested in the Subscription and the Whitewash Waiver) who are
not required to abstain from voting on the resolutions to be proposed at
the SGM to approve the Subscription and the Whitewash Waiver under
the Listing Rules and the Takeovers Code respectively
“Last Trading Day” 3 December 2007, being the last full trading day for the Shares
immediately before the issue of this announcement
“Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange
“Mr. Wong” Mr. Wong Kwan, Chairman and Chief Executive of the Company and
an executive Director
“PRC” The People’s Republic of China
“SFC” Securities and Futures Commission of Hong Kong
“SGM” a special general meeting of the Company to be convened to consider
and approve the Subscription, the Whitewash Waiver and the proposed
increase in authorized share capital of the Company
“Subscriber” Orient Day Developments Limited, a company incorporated in the
British Virgin Islands with limited liability, and wholly owned by Mr.
Wong
“Subscription” the subscription of 77,456,000 new Shares by the Subscriber pursuant
to the terms of the Agreement
“Subscription Price” HK$.00 per Subscription Share
“Subscription Shares” 77,456,000 new Shares to be subscribed by the Subscriber pursuant to
the Agreement
“Shareholder(s)” holder(s) of the Share(s)
“Share(s)” ordinary share(s) of HK$0.50 in the share capital of the Company
“Stock Exchange”
As at the date hereof, the Board comprises six executive Directors, namely Mr. Wong Yuk Kwan (alias:
Wong Kwan), Mr. Chan Yiu Keung, Mr. Cheung Kwok Yu, Mr. Zhou Li Yang, Mr. Zheng Yingsheng and Mr.
Johnny Yuen and three independent non-executive Directors, namely Dr. Dong Zhixiong, Mr. Fung Hing
Chiu, Cyril and Mr. Lai Shi Hong, Edward.
The Directors jointly and severally accept full responsibility for the accuracy of the information contained in
this announcement and confirm, having made all reasonable enquiries, 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.
By Order of the Board
Pearl Oriental Innovation Limited
Cheung Kwok Yu
Executive Director and Company Secretary
Hong Kong, 2 January 2008