Announcements made on 29 July 2003 - Minutes of Extraordinary General Meeting and Proposed Issue of S$200, 000, 000 7 Years Fixed Rate Notes

Further to the Company's announcements on 29 July 2003, we wish to clarify and reassure shareholders that the Group has more than enough cash and fixed deposits to fund the Capital Reduction Exercise, which was approved by shareholders at an EGM held on that date.


The manner and the cost of funding the Capital Reduction Exercise have been clearly set out in the Circular to Shareholders dated 4 July 2003. I quote from page 14 of the Circular:

" 3.5 Funds for the Capital Reduction Exercise

The Capital Reduction Exercise will be made out of existing cash, or near cash, resources. The F&N Group had S$659.6 million in cash and bank fixed deposits as at 30 September 2002. "


In addition the Net Asset Value and Earnings Calculations shown on page 20 already consider the "opportunity" cost of the funds used for the Capital Reduction Exercise.


The issue of the $200m loan notes is driven by prudent financial management and is wholly unconnected to the Capital Reduction Exercise. As disclosed in the Company's announcement on the notes issuance, the proceeds will be used to fund working capital and refinance borrowings. This refinancing is part of the Company's ongoing efforts to manage and minimise interest cost, and is being executed as there is an opportunity to swap existing short term borrowings into longer term debt.



Submitted by Anthony Cheong Fook Seng, Group Company Secretary on 31/7/2003 to the SGXFurther to the Company's announcements on 29 July 2003, we wish to clarify and reassure shareholders that the Group has more than enough cash and fixed deposits to fund the Capital Reduction Exercise, which was approved by shareholders at an EGM held on that date.


The manner and the cost of funding the Capital Reduction Exercise have been clearly set out in the Circular to Shareholders dated 4 July 2003. I quote from page 14 of the Circular:

" 3.5 Funds for the Capital Reduction Exercise

The Capital Reduction Exercise will be made out of existing cash, or near cash, resources. The F&N Group had S$659.6 million in cash and bank fixed deposits as at 30 September 2002. "


In addition the Net Asset Value and Earnings Calculations shown on page 20 already consider the "opportunity" cost of the funds used for the Capital Reduction Exercise.


The issue of the $200m loan notes is driven by prudent financial management and is wholly unconnected to the Capital Reduction Exercise. As disclosed in the Company's announcement on the notes issuance, the proceeds will be used to fund working capital and refinance borrowings. This refinancing is part of the Company's ongoing efforts to manage and minimise interest cost, and is being executed as there is an opportunity to swap existing short term borrowings into longer term debt.



Submitted by Anthony Cheong Fook Seng, Group Company Secretary on 31/7/2003 to the SGX