YUE FUNG INT'L<0965> - Announcement

The Stock Exchange of Hong Kong Limited takes no 
responsibility for the contents of this announcement, makes 
no representation as to its accuracy or completeness and 
expressly disclaims any liability whatsoever for any loss 
howsoever arising from or in reliance upon the whole or any 
part of the contents of this announcement.

YUE FUNG INTERNATIONAL GROUP HOLDING LIMITED
(incorporated in Bermuda with limited liability)

DISCLOSEABLE TRANSACTION

Yue Fung International Group Holding Limited (the "Company" 
which together with its subsidiaries, the "Group") has 
agreed to acquire from each of Mr Fu Chu Kan and Ms Fu Yin 
Ling (the "Vendors") 125 shares (the "Sale Shares") of 
US$1.00 each in the capital of Richlink International 
Holdings Limited (the "Richlink" which together with its 
subsidiaries, the "Richlink Group"), being 25 per cent. of 
the entire issued share capital of Richlink.

The Company has also agreed to acquire from the Vendors the 
shareholders' loan (the "Sale Loan") of HK$2,500,000 owed 
by Richlink Group to the Vendors in the sum of HK$1,250,000 
each.

The consideration payable by the Company for the acquisition 
(the "Acquisition") of the Sale Shares and the Sale Loan is 
HK$34,875,000 and will be satisfied partly by the allotment 
and issue to the Vendors of 60,000,000 new ordinary shares 
(each a "Consideration Share") of HK$0.10 each in the capital 
of the Company at an issue price (the "Issue Price") of 
HK$0.45 per Consideration Share and partly by the transfer 
of certain machinery and moulds from the Group worth 
HK$7,875,000 to the Vendors.

The Acquisition is subject to the conditions as detailed 
below.

The Acquisition constitutes a discloseable transaction on 
the part of the Company under the Rules (the "Listing Rules") 
Governing the Listing of Securities on The Stock Exchange 
of Hong Kong Limited (the "Stock Exchange"). 

For the year ended 31st May 1999, products purchased by the 
Group from the Richlink Group amounted to approximately 
HK$7,300,381. The purchases from the Richlink Group for the 
year ended 31st May 1999 accounted for approximately 7.3 per 
cent. of the total purchases made by the Group for the year 
ended 31st May 1999. It is intended that following the 
Acquisition, the Group will continue to purchase from the 
Richlink Group.

A special general meeting (the "SGM") of the Company will 
be convened as soon as possible to consider and if thought 
fit, passing the resolutions to approve the allotment and 
issue of the Consideration Shares. 

A circular containing, among other matters, details of the 
Agreement, the notice convening the SGM will be dispatched 
to the Shareholders within 21 days after the date of 
publication of this announcement.

The Sale and Purchase Agreement dated 28th January 2000 (the 
"Agreement")

Parties

(1)     The Purchaser:  The Company

(2)     The Vendors:    The Vendors 

Each of the Vendors is an independent third party not 
connected with the directors, chief executive or substantial 
shareholders of the Company or any of its subsidiaries or 
any of their respective associates (as defined in the Listing 
Rules). Immediately before the entering into of the 
Agreement, the Vendors have not had any interests in the 
shares (each a "Share") of HK$0.10 each in the capital of 
the Company or its subsidiaries.

Assets acquired

Pursuant to the Agreement, the Vendors have agreed to sell 
and the Purchaser has agreed to purchase the Sale Shares, 
being 25 per cent. of the entire issued share capital of 
Richlink and the Sale Loan. The remaining 75 per cent, will 
be held by Mr. Fu Chu Kan and Ms. Fu Yin Ling, as to 67.5 
per cent and 7.5 per cent respectively. Richlink was 
incorporated in the British Virgin Islands on 19th August 
1998 and as at the date of this announcement, its entire 
issued share capital was beneficially owned as to 80 per cent. 
by Mr. Fu Chu Kan and as to the balance of 20 per cent. by 
Ms. Fu Yin Ling.

No audited financial statements have been prepared by 
Richlink since its incorporation. As at 30th September 1999, 
the net asset value of the Richlink Group based on its 
unaudited consolidated management accounts was 
approximately HK$19,200,000. For the period commencing from 
19th August 1998 to 30th September 1999, the Richlink Group 
recorded an unaudited consolidated profit of approximately 
HK$19,200,000, the 9 months' operating profit.

The consideration payable by the Company on the 25% issued 
share capital of Richlink is based on the unaudited annual 
profit of Richlink Group of HK$23,250,000 for the year ended 
1999, multiplying this with a profit earning ratio of 6, 
which is based on companies in the similar industry, thus 
estimating the net worth of Richlink Group at 
HK$139,500,000.

Richlink Group are principally engaged in the manufacture 
and sale of melamine products, rubber key products and other 
electronic components.

The Company has also agreed to acquire from the Vendors the 
shareholders' loan (the "Sale Loan") of HK$2,500,000 owed 
by the Richlink Group to the Vendors in the sum of 
HK$1,250,000 each payable on demand. HK$2,500,000, the Sale 
Loan, is 25% of the total shareholders' loan of HK$10,000,000 
of Richlink Group.

Consideration

The consideration for the Acquisition is HK$34,875,000 and 
will be satisfied partly by the allotment and issue to the 
Vendors of the 60,000,000 Consideration Shares (each a 
"Consideration Share") at the Issue Price and by the transfer 
from the Group to the Vendors of machinery, such as plastic 
injection machines and moulds at book value worth 
HK$7,875,000.

The Issue Price represents a discount of approximately 21.7 
per cent. to the average closing price of the Shares of 
HK$0.5745 for the last ten trading days up to the date of 
the Agreement and a discount of approximately 10 per cent. 
to the closing price of the Shares of HK$0.5 as at the date 
of the Agreement. 

The Consideration Shares represents approximately 17.5 per 
cent. of the issued share capital of the Company and 
approximately 14.9 per cent. of the issued share capital of 
the Company as enlarged by the allotment and issue of the 
Consideration Shares. The controlling shareholder's 
shareholding will be diluted from 44.5% to 37.8%. The SGM 
will be convened and held to approve, among other matters, 
the allotment and issue of the Consideration Shares to the 
Vendors credited as fully paid at the Issue Price.

The consideration was negotiated on an arm's length basis 
and on normal commercial terms between the Vendors and the 
Company. 

The Directors, including the independent non-executive 
directors, consider that the terms of the Agreement are based 
on normal commercial terms and are fair and reasonable so 
far as the shareholders of the Company and Company are 
concerned.

Completion 

Completion will take place on the second business day after 
all the conditions set out in the section headed "Conditions" 
below have been fulfilled, which is expected to be on or 
before 31st March 2000 or such later date as the Vendors and 
the Company may agree.

Conditions 

Completion of the Acquisition is conditional upon 
fulfillment of the following conditions:

(1)     the Listing Committee of the Stock Exchange granting 
listing of and permission to deal in the Consideration Shares; 
and

(2)     the shareholders of the Company passing at the SGM an 
ordinary resolution approving the allotment and issue of the 
Consideration Shares to the Vendors, credited as fully paid.

If the conditions are not fulfilled on or before 31st March 
2000 or such later date as the Vendors and the Company may 
agree, the Agreement shall cease and terminate and none of 
the parties shall have any claim against the others.

Continuing Transactions

For the year ended 31st May 1999, based on the Company's 
consolidated audited accounts, components of calculators 
purchased by the Group from the Richlink Group amounted to 
approximately HK$7,300,381. The purchases from the Richlink 
Group for the year ended 31st May 1999, based on the Company's 
consolidated audited accounts, accounted for approximately 
7.3 per cent. of the total purchases made by the Group for 
the year ended 31st May 1999. It is intended that, following 
the Acquisition, the Group will continue to purchase from 
the Richlink Group.

Reasons for the Acquisition

The Directors believe that the Acquisition would enable the 
Group to secure a steady supply of the essential components 
including rubber key pads and certain electronic parts of 
the Group's products such as calculators and databanks, 
enable vertical integration of its manufacturing process, 
enhance the Group's asset base and improve its earnings which 
will ultimately benefit the shareholders.

The Company will continue to diversify and develop the 
internet business especially for primary, secondary and 
tertiary education and the development of internet content 
provider business in the PRC and Hong Kong.

General

After the acquisition, Richlink will become an associated 
company of the Company. The Company is principally engaged 
in investment holding with its subsidiaries principally 
engaged in the design, development, maintenance and sale of 
a wide range of electronic calculators, digital timers, 
clocks, watches and databanks.

The SGM will be convened as soon as possible to consider and 
if thought fit, passing the resolutions to approve the 
allotment and issue of the Consideration Shares.

A circular containing, among other matters, details of the 
Agreement, the notice convening the SGM, will be dispatched 
to the Shareholders within 21 days after the date of 
publication of this announcement.

Application will be made to the Stock Exchange for the 
listing of and permission to deal in the Consideration 
Shares.

This Transaction will not affect the placing of existing and 
subscription of new shares previously announced by the 
Company on 25th January 2000.

By order of the board 
Yue Fung International Group Holding Limited
Lee Wing Kan
Chairman

Hong Kong, 28th January 2000