Shareholder restructure

Zhejiang Expressway Co
21 January 2002

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents
of this announcement, makes no representation as to its accuracy or completeness
and expressly disclaims any liability whatsoever for any loss howsoever arising
from or in reliance upon the whole or any part of the contents of this
announcement.

                       ZHEJIANG EXPRESSWAY CO., LTD.

 (a joint stock limited company incorporated in the People's Republic of China
                            with limited liability)

                                  Announcement
               Restructuring of the controlling shareholder

Due to a restructuring of state-owned enterprises by the Zhejiang Provincial
Government, Provincial Investment Co, which is the existing controlling
shareholder of the Company will be replaced by Communications Investment Group.

Restructuring of the Controlling Shareholder

The Zhejiang Provincial Government is conducting a restructuring of its
state-owned enterprises. As part of the restructuring, Provincial Investment Co
will be replaced by Communications Investment Group pursuant to a notice dated
2nd July, 2001 issued by the Zhejiang Provincial Government (Zhe Zheng Fa (2001)
No. 42) at nil consideration. As a result the existing shareholding of
Provincial Investment Co. in the Company, which amounts to approximately 56 per
cent of the issued share capital of the Company will be held by Communications
Investment Group.

The shareholding structures of the Company immediately before and immediately
after the said replacement are illustrated in the simplified corporate charts
below:




                        Immediately before the said replacement

                        Immediately after the said replacement


Communications Investment Group is a state-owned enterprise which was
established by Zhejiang Provincial Government through Zhejiang State Assets
Management Commission. It is the business entity for the Zhejiang Provincial
Government in the transportation industry. Communications Investment Group was
estabilished on 29th December 2001. The registered capital of Communications
Investment Group is RMB5,000,000,000. It is principally engaged in investment,
operation, maintenance and toll collection of transportation infrastructure,
construction of transportation projects, carrying out of construction works and
management of relevant material, provision of transportation and logistics
services and making of other investments.


The replacement of Provincial Investment Co. by Communications Investment Group
as the controlling shareholder of the Company is subject to the approval of and
registration with the relevant PRC Government authorities. Immediately after the
obtaining of the relevant approval, Communications Investment Group will be
interested in 56% of the issue share capital of the Company and become the
immediate controlling shareholder of the Company within the meaning of the
Listing Rules.

Since the H shares of the Company are listed on The Stock Exchange of Hong Kong
Limited, the replacement of Provincial Investment Co. by Communications
Investment Group as the controlling shareholder of the Company may lead to an
obligation under Rule 26.1(a) of the Takeovers Code for Communications
Investment Group and parties acting in concert with it to make a general offer
to the holders of the shares in the capital of the Company. However, since the
said replacement will not result in any significant change in the ultimate
controlling shareholding by Zhejiang State Assets Management Commission and the
Zhejiang Provincial Government in the Company, application has been made to the
Securities and Futures Commission for the granting of a waiver from the
requirement for making a general offer by Communications Investment Group and
parties acting in concert with it for all the shares in the share capital of the
Company.

Definitions

In this announcement, unless the context otherwise requires, the following
expressions have the following meanings:

'Communications Investment Group'           Zhejiang Communications Investment Group Co., Ltd., a company established
                                            in the PRC on 29th December 2001;

'Company'                                   Zhejiang Expressway Co., Ltd., a joint stock limited company incorporated
                                            in the RPC, whose H Shares are listed on The Stock Exchange of Hong Kong
                                            Limited;

'Listing Rules'                             the Rules Governing the Listing of Securities on The Stock Exchange of Hong
                                            Kong Limited;

'PRC'                                       the People's Republic of China;

'Provincial Investment Co.'                 Zhejiang Provincial High-class Highway Investment Company Limited, a
                                            company established in the PRC, being the existing controlling shareholder
                                            of the Company; and

'Takeovers Code'                            The Code on Takeovers and Mergers.

                                                                                             By Order of the Board
                                                                                                      Jiang Wenyao
                                                                                                 Company Secretary
                                                                   Hangzhou, Zhejiang, the PRC, 21st January, 2002



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