Contents :

Your letter dated 5 February 2004 refers.

We hereby furnish the following additional information request by the Exchange.


Payment arrangements

The terms of payment are as follows:-

(i) 10% (i.e. RM561,000) in cash upon signing of Share Sale Agreement.
(ii) 80% (i.e. RM4,488,000) in kind by sale of properties by Magna Prima Berhad and/or its subsidiaries (“Magna”).
(iii) 10% (i.e. RM561,0000) in ten monthly cash installments after completion of the agreement.

Details of Vendor

Lai Way Fatt (NRIC No. 610914-05-5509) of No. 34, Jalan SS 18/5F, 47600 Subang Jaya, Petaling Jaya, Selangor Darul Ehsan.

Liabilities to be assumed

MPB will not assume any additional liabilities arising from the proposed Acquisition.

Profit guarantee

The profit guarantee provided to the Purchaser is in relation to the achievability of the forecasted profit after tax of the Company for the financial years ending (“FYE”) 31 December 2004, 31 December 2005 and 31 December 2006 of Ringgit Malaysia Two Million (RM2,000,000) for FYE 31 December 2004, Ringgit Malaysia Two Million Two Hundred Thousand (RM2,200,000) for FYE 31 December 2005 and Ringgit Malaysia Two Million Four Hundred Thousand (RM2,400,000) for FYE 31 December 2006.

Net profit and NTA

Based on latest audited accounts (year ended 31 December 2002):

Net loss after taxation : RM77,052
Net Tangible Assets : RM333,786

Cost of Investment

The Vendor’s original cost and date of investment in the sale Shares are as shown below:

Date No of Sale Consideration Cost of
Shares acquired acquisition

15/04/1996 60,000 Cash 60,000
31/10/1996 15,000 Cash 15,000
21/02/1997 30,000 Cash 30,000
21/02/1997 120,000 Cash 120,000
10/06/2003 200,000 Cash 200,000

Total 425,000 425,000




As part of the condition to the Acquisition, the Vendor shall deliver 51% equity interest equivalent to the enlarged share capital of Gallery of RM1,000,000.


Prospects and risks factors associated with the Acquisition

Prospect :

1) Based on the profit projections backed by a 3-year profit guarantee, the acquisition is expected to increase future earnings of Magna.

2) The acquisition of Gallery is viewed to be synergistic with Magna’s property development activities.

Risks:

Gallery is considered as one of the experienced player in the industry. The Management does not foresee the acquisition to result in any substantial risks exposure to Magna.

Estimated timeframe for completion of Acquisition

Tentative Timetable

February 04 - Submission of application to FIC.
- Receipt of due diligence report from advisor.
- Payment of 10% deposit from stakeholder to vendor.

March 04 - Approval from FIC.

April 04 - Completion of Share Transfer.

Query Letter Contents :

We refer to your announcement dated 30 January 2004 in respect of the aforesaid
Acquisition.
In this connection, kindly furnish the Exchange with the following additional
information for public release:
Terms of any arrangement for payment of the cash consideration on a deferred
basis;
Details of the vendor;
Particulars of all liabilites to be assumed, if any;
Particulars of the profit guarantee provided by the vendor;
Net profit and net tangible assets of Gallery;
Original cost of investments to the vendors and date of such investments in
respect of Gallery;
Prospects and risks factors associated with the Acquisition; and



8. Estimated timeframe for completion of the Acquisition.
Please furnish the Exchange with your reply within two (2) market days from the
date hereof.
Yours faithfully

INDERJIT SINGH
Sector Head
Issues & Listing
Group Regulations
CKM