Hongkong and Shanghai Hotels selling The Kowloon Hotel to Swingfield Developments Limited
	The Hongkong and Shanghai Hotels, Limited (HSH) announced that through its wholly owned subsidiary, HSH Holdings Limited, the company has entered into an agreement to sell The Kowloon Hotel to Swingfield Developments Limited for a consideration of HK$1.93 billion.
Swingfield Developments is an investment holding company owned by Cheung Kong (Holdings) Limited (CKH) and Hutchison International Limited, both of which are the purchaser�s guarantors. A cash deposit of HK$193 million has been received as part payment of the consideration with the balance of a provisional HK$1.737 billion to be paid on completion, which is scheduled for February 1, 2005. HSH�s directors understand that the purchaser intends to continue running The Kowloon Hotel as a hotel subsequent to acquisition. Commenting on the successful sale, HSH chief executive officer Clement Kwok said, �Interest in purchasing this property has been high, and the company is pleased to have secured for its shareholders a fair and reasonable agreement that reflects the quality of the asset and its management and staff. �The disposal of The Kowloon Hotel will allow the company to focus its resources on developing and marketing its principal businesses and the Peninsula brand. The proceeds will be used in the development of new hotels such as The Peninsula Tokyo and The Peninsula Shanghai, as well as in continuing refurbishment or renovation of existing hotel and property interests. In addition, funds will be applied towards reducing bank borrowings and effectively managing the company�s cost of funding.� The net asset value of the hotel�s owner, The Kowloon Hotel Limited (KHL), a wholly owned subsidiary of HSH Holdings, was HK$510.5 million, as set out in the company�s audited accounts for the year ended December 31, 2003. The consideration is adjustable depending on the net asset value of KHL shown in the Completion Accounts, which will be prepared within one month of completion. It is expected that the company would realise an estimated special gain of approximately HK$800 million, being the difference between the consideration (less expenses) and the carrying value or cost of net assets of KHL. The 736-key Kowloon Hotel was opened in 1986; its facilities include three restaurants, a bar, a business centre, meeting rooms and retail.