Acquisition of Tien Chun Pte Ltd from China Dairy Group Ltd

Fraser and Neave, Limited ("F&NL") announced on 1 November 2006 that its wholly-owned subsidiary, F&N Dairy Investments Pte Ltd ("F&NDI"), entered into a conditional Put and Call Option Agreement (the "Agreement") with China Dairy Group Ltd ("CDG"), whereby F&NDI would be entitled to require CDG to sell ("Call Option"), and CDG would be entitled to require F&NDI to purchase, all of CDG's interest in the issued share capital of Tien Chun Pte Ltd ("TCPL").

F&NL is pleased to announce the completion of the acquisition by F&NDI of the entire issued share capital of TCPL (the "Acquisition") following the exercise of the Call Option upon satisfaction of conditions set out in the Agreement. TCPL has, on completion of the Acquisition, become a wholly-owned subsidiary of F&NDI.