Proposed Acquisition of Hydro-power Plant Posted on 09 Sep 02

Hong Kong, September 9, 2002 - Laminates manufacturer, Kingboard Chemical Holdings Limited (SEHK: 148) ("Kingboard Chemical") today announces its non wholly-owned subsidiary, Kingboard Copper Foil Holdings Limited (SES: KBCF) ("Kingboard Copper Foil"), has signed a Memorandum of Understanding with Yingde City People`s Government to acquire the fixed assets of a 72MW hydro-power plant in Yingde for RMB700 million.

Kingboard Copper Foil was listed on the Main Board of the Singapore Exchange Securities Trading Limited in December 1999 and is now 57.68% owned by Kingboard Chemical. Kingboard Copper Foil is principally engaged in the manufacture of copper foil at Fogang, Qingyuan. Its monthly production capacity is 1,600 tones, which is supplied to Kingboard Chemical as well as external customers. Copper foil is one of the key raw materials for the production of laminates and plays a crucial role in Kingboard Chemical`s vertically integrated production.

"We believe that this is an excellent investment opportunity as it will enhance our copper foil`s competitiveness by lowering its production costs. This in turn enables Kingboard Chemical broaden its market share in the laminate industry, creating a win-win situation for both Kingboard Chemical and Kingboard Copper Foil." Mr. Paul Cheung Kwok-Wing, Chairman of Kingboard Chemical and Kingboard Copper Foil.

Qingyuan City People`s Government highly appreciates Kingboard Copper Foil`s investment in Qingyuan. Mr. Chen Yongzhi, Secretary of Qingyuan City People`s Government, commented, "Kingboard started its copper foil business in Qingyuan in 1993. Since then, its copper foil business has been developing at a fast pace. Qingyuan City People`s Government will give its unequivocal support to the acquisition and wish Kingboard Chemical and Kingboard Copper Foil every success in the future."

Kingboard Chemical (SEHK: 148), the leading Hong Kong and PRC laminates manufacturer and one of the largest in the world, with more than 15 plants operating in different parts of China, has successfully integrated vertically in-house production of copper foil, glass fabric, glass yarn, bleach kraft paper, epoxy resin, formalin and hydrogen peroxide needed for its laminate business. The Group has the honour of being named one of the "World 200 Best Small Enterprises" by Forbes Global for two consecutive years in 2000 and 2001.

Issued by :
Kingboard Chemical Holdings Limited
Catherine Chan or Monica Wong
tel: 2605 6493 / fax: 2691 5245