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Hutchison Whampoa Limited

For Immediate Release

TOM acquires Taiwan's Business Weekly

Milestone In TOM's Building of Region's Largest Print Media Platform

Hong Kong, December 11, 2001 - TOM.COM LIMITED ("TOM", stock code: 8001) announced today that it has entered an agreement to acquire up to 100% of Business Weekly Publishing Inc. (Business Weekly), Taiwan's leading Chinese-language magazine and book publisher. With the move TOM becomes Taiwan's largest magazine and book publisher group. It marks yet another milestone in TOM's building of the largest Chinese print media platform in Greater China.

Under the agreement TOM will acquire Business Weekly and two of its subsidiaries -- Nong Nong Magazine Co. Ltd and Business World Consulting Co. Ltd. Business Weekly's 14-year old flagship publication Business Weekly is the top-selling business and economic weekly in Taiwan. Nong Nong is publisher of several popular fashion, lifestyle and healthcare titles including Citta Bella , the Taiwan edition of Marie Claire , Mom Baby and Shape . Business World Consulting is Business Weekly's editing and publishing business targeting corporate clients.

TOM will also have the option to acquire Business Weekly's four other businesses - E-Business Weekly Publishing Inc, publisher of E-Business Weekly ; To'go Publishing Inc, publisher of TO'GO Travel ; Sunbright Publishing, Business Weekly's book publishing arm; and Abovewebs.com Inc., Business Weekly's online operations. The four businesses can only be acquired as a whole and not separately, depending on their 2002 financial results.

TOM will pay in total up to NT$1,650 million (approx. HK$370 million) for the acquisitions, out of which about NT$825 million (approx. HK$185 million), or 50%, will be paid in cash. (See Deal Structure)

TOM will pay 25% of the acquisition price, or NT$412.5 million (approx. HK$92.6 million), via the issue of approximately 16.8 million TOM shares at HK$5.51 per share; and the remaining 25% of the acquisition price via the issue of new shares in the listing of TOM's print media vehicle (IPO shares).

Conditions on issue of TOM shares

The actual number of TOM shares to be issued to Business Weekly shareholders is subject to a profit guarantee arrangement and whether TOM exercises the option to acquire Business Weekly's four other businesses. The TOM shares will be issued in proportion to how Business Weekly meets the 2001 and 2002 pre-tax profit guarantees of respectively of NT$125 million (approx. HK$28 million) and NT$145 million (approx. HK$32.5 million). The issue of 8,145,790 TOM shares, or equivalent to NT$200 million (approx. HK$45 million), will be made only when TOM exercises the option to acquire the four other businesses.

Conditions on issue of IPO shares

The issue of IPO shares equivalent to NT$50 million is subject to the same profit guarantee arrangement mentioned above. And IPO shares equivalent to NT$362.5 million (approx. HK$81 million) will be issued within 24 months from the completion of the deal.

Business Weekly already has a 3.89% stake in Home Media Group (HMG), TOM's centralised print media platform which includes PC Home and Cit Publishing. After the completion of the deal, TOM's stake in HMG will effectively be increased to 52.89%.

As Taiwan's leading magazine group, Business Weekly owns unique media assets with strong branding value. Its magazines are all successful titles in the business and finance, fashion and healthcare areas. Business Weekly is Taiwan's best-selling business and economic weekly with an average circulation of over 100,000 copies per issue. The weekly has acquired a strong readership base among Taiwan's business elites. As a weekly publication, Business Weekly enjoys a significant market share in advertising and high entry barrier. It will complement PC Home's monthly publications. The strong Business Weekly brand can also be extended to other business literature such as books.

Business Weekly's net revenues in 1999 and 2000 were about NT$491.5 million (approx. HK$110 million) and NT$637.3 million (approx. HK$143 million) respectively. It recorded pre-tax profit, respectively, of about NT$43.1 million (approx. HK$9.7 million) and NT$177.1 million (approx. HK$39.7 million) in the two years.

With the Business Weekly acquisition, TOM's print media platform is now firmly established with top-quality assets from Taiwan's four leading publishing groups - Business Weekly, PC Home, Cit and Sharp Point Publishing (Taiwan's largest youth magazine and book publisher), the acquisition of which was announced last month. These four publishing groups with its 40 magazines together recorded an annual circulation of over 28 million copies in 2000. The magazines in TOM's print media business enjoy a 30% - 40% market share in their respective categories in Taiwan.

Commenting on the acquisition, Mr. Sing Wang, Chief Executive Officer and Executive Director of TOM, said, "Business Weekly is a showcase of how a niche print media group has become a hugely successful and profitable publishing operation. The company will bring a wealth of magazine management experience and unique content that are invaluable for our entry into the vast China market."

TOM has already consolidated a functional print media platform that allows content sharing, cross-licensing of publishing rights amongst the different print media units as well as maximising optimal efficiency. The addition of Business Weekly to TOM's print media platform will enrich its cross-selling offerings to advertisers.

Business Weekly Chairman James Jin said, "With TOM's brand leadership in the Greater China, we are confident of capturing future growth in the China market. I believe new opportunities will arise now that we are part of TOM."

According to estimates, Greater China's print media market in 2000 was worth US$30 billion with an annual growth rate of 15% and about 79% of this market is in Mainland China.

(Notes to Editors)

About Business Weekly Publishing Inc.

Established in 1987, Business Weekly Publishing Inc. (Business Weekly) is Taiwan's leading magazine publisher with a 14-year operating history. Its flagship publication Business Weekly is Taiwan's best-selling business magazine with an annual circulation of 5.6 million copies. Other popular titles include Citta Bella , a widely-read monthly on fashion trends; Mom Baby , a monthly providing tips on pregnancy, child care and parenting; TO'GO Travel , a monthly travel and leisure magazine; and E-Business Weekly , a weekly magazine on latest "new-economy" developments. They target women readers, travelers and IT professionals. Business Weekly has established excellent relations with international publishers. It is publishing the Taiwan edition of Marie Claire , a monthly on fashion and style, and has recently secured publishing right to Shape , a monthly on fitness, from the world's largest health magazine group.

Its book publishing operation, Sunbright Publishing currently publishes some 217 titles. Starting in 2001, it focuses on publishing books with business and business-related topics. Business Weekly's editing business, Business World Consulting is the largest Chinese-language editing and publishing consultancy with clients including the Taiwan government. Business Weekly also has a successful online operation, Abovewebs.com.

Founder and Chairman James Jin, a leading intellectual in Taiwan, has seen Business Weekly go through the "learning period" in the eighties. After the initial seven years of loss-making and another seven years of innovation, Business Weekly has now established a leading brand in Taiwan and become hugely profitable.

To download photos of Business Weekly publications, please click
http://hk.tom.com/event/press/20011211/photo.shtml

About TOM.COM LIMITED

TOM.COM LIMITED (TOM) is a joint venture between Hutchison Whampoa Ltd., Cheung Kong (Holdings) Ltd. and other strategic investors. TOM was listed on the Growth Enterprise Market of the Stock Exchange of Hong Kong in March 2000 (stock code: 8001).

TOM has pioneered the cross media strategy, building a portfolio of online and offline media assets through acquisitions and organic growth. Its goal is to be the industry leader in each of its four business segments - sports marketing, outdoor media, print media and Internet portals. TOM is also building a strong platform to offer telecom value-added services.
(http://corp.tom.com/about/en/index.shtml)

####

For press enquiries:
Rachel Chan, TOM.COM LIMITED
Tel: (852) 2121 7810
Fax: (852) 2127 7576
Email: rachelc@hk.tom.com

Highlights of the Business Weekly Transaction

The Investment

  • TOM to acquire up to 100% in Business Weekly for up to NT$1,650million (approx. HK$370 million)

    Deal Structure

  • 50% of the consideration (NT$ 825 million) will be paid in cash
  • 25% of the consideration (NT$ 412.5 million) will be paid in TOM shares at HK$5.51 per share
  • 25% of the consideration (NT$412.5 million) will be paid in IPO shares

    Payment Method

    50%Cash
  • NT$825 million (approx. HK$185 million)
    • 25%TOM shares at HK$5.51 per share
  • NT$412.5 million (approx. HK92.6 million), out of which:-
      - NT$212.5 million (approx. HK$48 million) subject to profit guarantee

      - NT$200 million (approx. HK$45 million) subject to option to acquire other BW businesses

    • 25%IPO shares
  • NT$412.5 million (approx. HK$92.6 million), out of which:
      - NT$50 million (approx. HK$11 million) subject to profit guarantee

      - NT$362.5 million (approx. HK$81 million) issued within 24 months from completion of deal

    • Profit Guarantee

  • The number of TOM shares and IPO shares to be issued to Business Weekly shareholders will be in proportion to how Business Weekly meets the 2001 and 2002 pre-tax profit guarantees, respectively of NT$125 million & NT$145 million

    Option to Acquire:

    - E-Business Weekly, To'Go Publishing, Sunbright Publishing and Abovewebs.com will not be acquired by TOM initially

    - TOM has the option to acquire these companies, conditional upon certain performance targets being achieved for years 2001 and 2002

    Source: TOM.COM LIMITED
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