Press Release - Fraser Serviced Residences in the Middle East

Fraser and Neave, Limited (the " Company ") refers to the article "F&N residences unit ties up with Kuwaiti bank" (" Article ") in The Business Times today.

For information, Fraser Serviced Residences Pte Ltd (" FSR ") (a wholly owned subsidiary of the Company's wholly owned subsidiary, Frasers Centrepoint Limited) and Global Investment House (" Global ") (a Kuwaiti investment bank) have entered into an agreement (the "Agreement" ) whereby Global, through its subsidiary, will undertake:

- to raise the necessary equity capital from investors; and
- to source, invest and develop serviced apartment projects,

to be operated and managed by FSR under the Fraser brands "Fraser Place" and "Fraser Suites" in the countries of the Gulf Cooperation Council (" GCC ").

The Company wishes to clarify the Article as follows:

- Paragraph 1: The first paragraph of the Article states that "Kuwait's investment bank Global Investment House and Singapore's Fraser Serviced Residences are teaming up to invest US$500 million to create a Middle Eastern hospitality company in the next five years".

- Paragraph 2: The second paragraph of the Article states that the Middle Eastern hospitality company "will raise capital through a private placement to be announced in a few weeks".

The Company hereby clarifies that, pursuant to the Agreement, Global shall raise the necessary equity capital from investors to enable it to proceed with the development of serviced residences in the GCC through its subsidiary company. FSR is not required to invest in the form of equity or provide any form of funding in relation to the development or operation of any of the serviced apartment projects.

The Agreement is in line with FSR's target of achieving 6,000 apartments under its management by the financial year ending 2010 as stated in the Company's Annual Report for financial year ended 2005. It is also not expected to have any material impact on the earnings of the Company or Group for the current financial year, nor the net tangible assets per share of the Company or Group.

None of the directors or substantial shareholders of the Company has any interest, direct or indirect in the agreement.

Submitted by Anthony Cheong Fook Seng, Company Secretary on 18 April 2006 to the SGX.