Contents :

The Exchange's letter dated 25 June 2001 on the above matter refers.

We wish to advise as follows :-

1. The expected losses are as the following :-

1.1 Interest thereon at the following rates :-

1.1.1 the prescribed rate of 1.75% above the plaintiff's cost of funds calculated from 1 April 2001 until the date of full settlement.

1.1.2 default interest of 1% per annum calculated from 23 April 2001 until the date of full settlement.

1.2 Other costs, such further or other relief as this Honourable Court thinks fit.

1.3 Legal fees arising from the defending of the suit.

2. The steps taken and the proposed to be taken in respect of the above suit :-

2.1 Messrs. BDO Capital Consultants Sdn. Bhd. has been appointed with effect from 2 May 2001 to act on behalf of Denko Industrial Corporation Berhad ("Denko") to review and restructure the proposed debts restructuring scheme.

2.2 Messrs. P M Tan Chan & Partners has been instructed on 21 June 2001 to act on behalf of Denko to defend in respect of the above suit.

2.3 To negotiate further with Utama Merchant Bank Berhad to withhold or withdraw the filed litigation pending implementation of the proposed debts restructuring scheme.

Query Letter Contents :

We refer to your announcement dated 21 June 2001, in respect of the aforesaid
matter.
In this connection, kindly furnish the Exchange immediately with the following
additional
information for public release:
1. Expected losses, if any, arising from the Writ of Summons and Statement of
Claims.
2. The steps taken and proposed to be taken in respect of the above suit.
Kindly furnish the Exchange with your reply within two (2) market days from the
date hereof.

Yours faithfully
KUALA LUMPUR STOCK EXCHANGE


TAN YEW ENG
Senior Manager, Listing Operations
MBP/CS/JT
copy to: Securities Commission (via fax)