Vestpa PLC - Acquisition

RNS Number:4609H

Vestpa PLC

12 November 2007

Embargoed for Release at 7:01 a.m. on 12 November 2007

Not for release, publication or distribution in whole or in part in or into the

United States, Canada, Japan, Singapore, the Peoples' Republic of China,

Australia, the Republic of South Africa or any other jurisdiction where it is

unlawful to do so

Vestpa Plc

('Vestpa' or 'the Company')

Proposed acquisition of Full Fortune Holdings Pte. Limited ('Full Fortune')

Proposed Subscriptions for 16,666,667 New Ordinary Shares of 4p each

at a price of 30p per share

Proposed 1 for 40 share consolidation

Proposed change of name to 'China Food Company Plc'

Proposed adoption of New Articles

Application for admission of the Enlarged Share Capital to trading on AIM

Notice of General Meeting

The Board of Vestpa is pleased to announce that it has today conditionally

agreed to acquire the entire issued ordinary share capital of Full Fortune

Holdings Pte. Limited ('Full Fortune'), a company incorporated in Singapore.

Full Fortune is an investment holding company whose trading subsidiaries are

principally engaged in the manufacture and sale of branded consumer condiments

products and animal feeds in Weifang City and Shou Guang City, in the Shandong

province of China.

Certain definitions and terms apply throughout this announcement and your

attention is drawn to the table at the end of this announcement where these

definitions and terms are set out in full.

Highlights

* Full Fortune is the holding company for Fu-Rich, Fuss Feed and Fuss

Biotech. Fu-Rich is the group's consumer foods business which produces a range

of different types of soya sauce, vinegar and bean paste under its own brand

names from its premises in Weifang City, Shangdong. For the year ended 31

December 2006, Full Fortune made a profit before tax of approximately #6.08

million on revenue of approximately #19.28 million.

* Fu-Rich produces approximately 50 to 60 products under its 'Fushi' and

'Fushi Hao Tai Tai' brand names from its current factory occupying a total

built-up area of approximately 17,663 sq. m. The Full Fortune Group has land use

rights over an area of 199,657 sq. m. for new premises in Shou Guang City and a

new manufacturing facility for Fu-Rich is currently under construction which

will increase its production capacity by 50 per cent. from 100,000 to 150,000

tonnes per annum.

* Fu-Rich operates in one of the fastest growing segments within the

PRC's food industry reflecting the increasing purchasing power of Chinese

consumers. Annual sales for this market segment are estimated to have grown from

RMB59 billion in 2004 to RMB100 billion in 2006 (approximately #6.4 billion at

the current exchange rate).

* Fu-Rich's primary market is Weifang but it also sells to other cities

in Shandong, as well as to neighbouring provinces including Henan, Jiangsu,

Anhui, Hebei, Tianjin, Beijing and Liaoning. Fu-Rich is believed to hold a

leading market position in Weifang and a significant share of the wider Shandong

marketplace. For the year to 31 December 2006, sales to provinces outside of

Shandong accounted for approximately 16.9 per cent. of Fu-Rich's total revenues.

* Fu-Rich sells its products via a network of 205 distributors,

retailers and numerous outlets of large and medium sized supermarket chains in

ten provinces and municipal cities in the north-eastern region of the PRC,

including Wal Mart, Carrefour, Shiji Lianhua and Jialejia.

* Fuss Feed was founded in November 1994. Initially focused on the

manufacture of Compound Feed for poultry, cows and pigs; it has since

diversified to manufacture higher-margin Premix and Concentrate Feed, operating

two production lines at a 15,000 sq. m. plant in Shou Guang City, Shangdong.

* In 2004, Fuss Feed embarked on a deliberate strategy to expand into

the neighbouring provinces around Shandong, with the selective appointment of

preferred distributors. As at 30 June 2007, it had a total of 13 distributors

located in Henan, Anhui, Jiangsu and Hebei and the New Board believes that there

is significant potential to grow revenues from these territories now that the

Full Fortune Group has an established foothold.

Summary financial information on the Full Fortune Group

Year ended Year ended Year ended

31 December 2004 31 December 2005 31 December 2006

#000s #000s #000s

Revenue 8,978 13,870 19,273

Gross profit 3,077 4,314 6,771

Gross margin (per cent.) 34.27 31.10 35.13

EBITDA 2,988 4,172 6,454

Profit before taxation 2,619 3,834 6,077

Profit after taxation 1,971 2,838 4,437

Net margin (per cent.) 21.95 20.46 23.02

Cash and cash equivalents 2,337 3,799 3,656

Net assets 4,820 6,997 10,545

* Proposed board of Vestpa from Completion to consist of members of the

Full Fortune Group's existing senior management including Raphael Tham (CEO),

Feng Bo (COO) and Frank Chau (CFO), alongside John McLean, the existing

Executive Director of Vestpa who will become Non-Executive Chairman and Derek

Marsh, CVO, as a new Non-Executive Director. On Completion, James Cane and

Thomas Vaughan are to step down from the board.

* The consideration payable in respect of the Acquisition is to be

satisfied through the issue of 40,333,333 New Ordinary Shares at the Issue Price

and a cash payment of #5 million. The consideration values all of the issued

Full Fortune share capital at approximately #25.17 million based on the Issue

Price and approximately #35.25 million based on the closing middle market price

of 75 pence (as adjusted for the Share Consolidation) per New Ordinary Share as

derived from the AIM Appendix to the Daily Official List on the business day

immediately prior to the date of this announcement.

* Share Consolidation comprising one New Ordinary Share of 4 pence each

for every 40 Existing Ordinary Shares of 0.1 pence each.

* Subscriptions to raise #5 million gross (approximately #4.1 million

after expenses) through the issue of 16,666,667 Subscription Shares at 30 pence

per share. The Subscription Shares will be issued fully paid and will, in

aggregate, represent approximately 25.33 per cent. of the Enlarged Share

Capital.

* In view of the size and nature of the Acquisition, it constitutes a

reverse takeover of the Company under the AIM Rules and therefore requires the

prior approval of Shareholders at a General Meeting.

* Following shareholder approval, Vestpa will change its name to 'China

Food Company Plc'.

* Strand Partners is acting as Financial and Nominated Adviser and

Broker in connection with the Proposals.

John McLean, Executive Director of Vestpa and Proposed Non-Executive Chairman of

the Enlarged Group, commented:

'The enlarged group will be led by a highly experienced management team

operating a well established business, in a growing market that is highly cash

generative, with a number of leading food brands. Our strategy will include the

expansion of the Full Fortune Group's existing product range in order to

capitalise on Fu-Rich's existing distribution network into the multiples in

China. The Full Fortune Group is currently increasing its production capacity on

a new site in Shou Guang City to meet anticipated future demand and will have a

low level of gearing on Admission.'

An Admission Document containing a notice covening a General Meeting to be held

at the offices of Fasken Martineau Stringer Saul LLP, 17 Hanover Square, London

W1S 1HU at 11.00 a.m. on Wednesday 5 December 2007 is being sent to shareholders

today.

Enquiries:

Vestpa Plc

John McLean, Executive Director Tel: +44 (0)7768 031 454

Strand Partners Limited

James Harris Tel: +44 (0) 20 7409 3494

Matthew Chandler

Hansard Group

Adam Reynolds Tel: +44 (0) 20 7245 1100

John Bick

This summary should be read in conjunction with the full text of this

announcement set out below.

Strand Partners Limited, which is authorised and regulated in the United Kingdom

by the Financial Services Authority, is acting as financial and nominated

adviser and broker to the Company in connection with the Acquisition,

Subscriptions and proposed admission of the Enlarged Share Capital to trading on

AIM. Its responsibilities as the Company's nominated adviser and broker under

the AIM Rules are owed solely to the London Stock Exchange and are not owed to

the Company or to any Director or Proposed Director or to any other person in

respect of their decision to acquire shares in the Company in reliance on any

part of this announcement. Strand Partners Limited is acting exclusively for

Vestpa and for no one else and will not be responsible to anyone other than the

Company for providing the protections afforded to their clients or for providing

advice in relation to the contents of this announcement or the Acquisition, the

Subscriptions or the proposed admission of the Enlarged Share Capital to trading

on AIM. No representation or warranty, express or implied, is made by Strand

Partners Limited as to the contents of this announcement, without limiting the

statutory rights of any person to whom this announcement is issued. The

information contained in this announcement is not intended to inform or be

relied upon by any subsequent purchasers of New Ordinary Shares (whether on or

off exchange) and accordingly no duty of care is accepted in relation to them.

Strand Partners Limited has approved the contents of this announcement solely

for the purpose of section 21 of the Financial Services and Markets Act 2000.

The principal place of business of Strand Partners Limited is 26 Mount Row,

London W1K 3SQ.

The Directors and Proposed Directors of Vestpa accept responsibility,

individually and collectively, for the information contained in this

announcement and for compliance with the AIM Rules. To the best of the knowledge

and belief of the Directors and Proposed Directors, who have taken all

reasonable care to ensure that such is the case, the information contained in

this announcement is in accordance with the facts and does not omit anything

likely to affect the import of such information.

This announcement does not constitute, or form part of, an offer or an

invitation to purchase any securities.

Not for release, publication or distribution in whole or in part in or into the

United States, Canada, Japan, Singapore, the Peoples' Republic of China,

Australia, the Republic of South Africa or any other jurisdiction where it is

unlawful to do so

12 November 2007

Vestpa Plc

('Vestpa' or 'the Company')

Proposed acquisition of Full Fortune Holdings Pte. Limited

Proposed Subscriptions for 16,666,667 New Ordinary Shares of 4p each

at a price of 30p per share

Proposed 1 for 40 Share Consolidation

Proposed change of name to 'China Food Company Plc'

Proposed adoption of New Articles

Application for admission of the Enlarged Share Capital to trading on AIM

Notice of General Meeting

1. Introduction

The Board is pleased to announce that the Company has conditionally agreed to

acquire the entire issued ordinary share capital of Full Fortune Holdings Pte.

Limited for a consideration, payable on Completion, comprising the issue of

40,333,333 New Ordinary Shares at the Issue Price and a cash payment of #5

million. The consideration values all of the issued Full Fortune share capital

at approximately #25.17 million based on the Issue Price and approximately

#35.25 million based on the closing middle market price of 75 pence (as adjusted

for the Share Consolidation) per New Ordinary Share as derived from the AIM

Appendix to the Daily Official List on the business day immediately prior to the

date of the Admission Document.

The cash element of the consideration is proposed to be financed by the Company

from the issue of 16,666,667 Subscription Shares at a price of 30 pence for each

Subscription Share.

Full Fortune is an investment holding company registered in Singapore whose

trading subsidiaries are principally engaged in the manufacture and sale of

animal feed and condiments for human consumption in Weifang City and Shou Guang

City, in the Shandong province of China.

In view of the size and nature of the Acquisition, it constitutes a reverse

takeover of the Company under the AIM Rules and a change of control of the

Company under the City Code. Accordingly, the Proposals are conditional, inter

alia, on the approval of Shareholders, such approval to be sought at the General

Meeting, notice of which is set out at the end of the Admission Document which

is being posted to Shareholders today.

If the Resolutions are duly passed at the General Meeting, the Company's

existing trading facility on AIM will be cancelled and the Company will apply

for the Enlarged Share Capital to be admitted to trading on AIM. Irrevocable

undertakings to vote in favour of the Resolutions have been received from

certain of the Directors and Albany in respect of 223,900,039 Existing Ordinary

Shares, representing approximately 60.51 per cent. of the Company's existing

issued share capital.

Shareholders should note that the Proposals are inter-conditional. If the

Resolutions are passed, it is expected that Admission will take place and that

dealings on AIM in the shares comprising the Enlarged Share Capital will

commence on 6 December 2007.

In connection with the Acquisition and Admission, it is proposed that John

McLean and the Proposed Directors will assume responsibility for the Enlarged

Group, including all of Vestpa's and Full Fortune's assets, and all of the

Sellers will exchange their Full Fortune Ordinary Shares for New Ordinary Shares

with the exception of Main World who will exchange its Full Fortune Ordinary

Shares for New Ordinary Shares and #5 million in cash pursuant to the

Acquisition Agreement.

2. The Company and its investment strategy

The Company was incorporated in England and Wales as a public limited company on

1 February 2007 and was established to seek to acquire a controlling interest in

a company, partnership or joint venture located in Europe, North America or

Asia. The Company's focus is on potential acquisition targets trading in any of

the following sectors: investment, consumer goods, engineering, industrials,

leisure and hotels, media and entertainment, professional and support services,

retailing, technology and telecommunications. It was admitted to trading on AIM

on 12 June 2007.

The Company's investment strategy is to seek suitable targets for investment or

acquisition that have some of the following characteristics:

* an experienced management team in place;

* good prospects, either in an established market or as an early mover in a

high growth market;

* quoted or unquoted; and

* located in Europe, North America or Asia.

If the Acquisition does not proceed, the Directors will continue to pursue the

aforementioned strategy. Whilst the Company will have incurred expenses

amounting to approximately #0.6 million in pursuit of the Acquisition, the

Directors are of the opinion that, whether or not the Acquisition proceeds, the

Company will have sufficient working capital for its present requirements, that

is for at least the next twelve months from the date of this announcement.

3. Background to and reasons for the Acquisition

As set out above, Vestpa's primary objective as an investment company is to

acquire a company with, inter alia, attractive growth prospects and an

experienced management team. In line with this strategy, the Directors believe

that the Acquisition represents a substantial investment opportunity with the

potential to deliver significant long-term enhancement of Shareholder value and

provide the Company with a number of benefits. In particular, the New Board

believes that the Acquisition will:

* provide the Company with a well established and proven business in the PRC

which has a decade of expertise in the production and sale of animal feed and

significant experience in the field of condiments, including soya sauce, vinegar

and bean paste;

* provide the Company with a profitable business with the opportunity for

continued commercial development and sustained long-term growth, utilising new

production facilities, under an experienced local management team;

* provide the Company with a strong position in an expanding market place,

fuelled by China's continuing prosperity and sustained economic growth; and

* raise the profile of the Enlarged Group, which may assist the Enlarged

Group to attract and retain additional suitably qualified and experienced

personnel to augment the experience of the New Board. Full Fortune may also

benefit from the perceived status and stature of being part of a publicly traded

group, which may enhance its reputation and financial standing with its key

partners and suppliers. In particular, it may provide a means by which the

Enlarged Group can fund its future activities and growth, both organically and

via potential acquisitions.

4. Information on Full Fortune, its business and strategy

Background and principal activity

Full Fortune is a privately owned investment holding company which was

incorporated in Singapore on 26 May 2005 as part of a corporate restructuring,

to act as the holding company for Fuss Feed, Fu-Rich and Fuss Biotech.

Founded in November 1994 by Fuss International Investment Group Inc. which is

owned by Mr Fu Guoping, Fuss Feed's principal activity is the production and

sale of a variety of animal feeds including Premix, Compound Feed and

Concentrate Feed. Initially focused on the manufacture of Compound Feed for

poultry, cows and pigs; it has since diversified to manufacture higher-margin

Premix and Concentrate Feed, operating two production lines at a 15,000 sq.m.

plant in Shou Guang City, Shandong.

Incorporated on 7 August 2001, Fu-Rich produces and sells a range of condiments

for human consumption, primarily different types of soya sauce, vinegar and bean

paste under its own brand names from its premises in Weifang City, Shandong

covering an area of 28,294 sq.m. In addition to its own products, it also sells

other food products, for example, pickled products, fungi products, chilli oil

and other flavour-enhancers (including MSG and chicken bouillon seasoning) that

are sourced from third party manufacturers and resold under its own brand names.

Fu-Rich was recognised as one of the top brands in Shandong for vinegar and soya

sauce products in both 2005 and 2006.

Fuss Biotech was incorporated on 24 June 2005 but has not commenced any trading

activities to date. It currently holds the land use rights in connection with

the development of the Full Fortune Group's new premises in Shou Guang City.

These land use rights cover an area of 199,657 sq.m. and the site is expected to

become the Full Fortune Group's corporate headquarters in mid 2008. In addition,

the Full Fortune Group has paid a deposit for rights to an adjoining land area

of 67,009 sq.m. for possible future expansion.

The Full Fortune Group has been financed to date by a combination of short term

loans from Chinese banks, loans and equity investment from its founder and

principal beneficial shareholder, Mr Fu Guoping, equity subscriptions from third

party investors and cash flow generated by the operating businesses.

Business location and local demographics

China is the world's most populous nation with approximately 1.292 billion

citizens, equivalent to approximately 20 per cent. of the world's estimated

population. Its population has continued to grow over the past decade, albeit at

a declining rate, compared to the previous decade.

The Full Fortune Group's operations are currently located at facilities in Shou

Guang City and Weifang City, both of which are in the PRC's central Shandong

province. Weifang borders Zibo to the west, Linyi to the southwest, Rizhao to

the south, Qingdao to the east and the Laizhou Bay to the north. The city

occupies a land area of over 15,800 sq. km and has a population of approximately

8.5 million people. Its neighbouring cities have similarly high populations with

Zibo, Linyi, Rizhao and Qingdao having approximately 4 million, 10 million, 2.8

million and 7.3 million residents respectively. Shou Guang City is situated west

of Weifang and Qingdao and east of Zibo and Jinan, the capital of the Shandong

province, with approximately one million residents. One of its closest

neighbours, Jinan, has a population of approximately 6 million people and covers

an area of over 8,100 sq. km.

In addition, the province of Shandong is itself bordered by some of the most

populous provinces in the PRC including Hebei, Henan, Anhui and Jiangsu with

populations of approximately 68 million, 96 million, 64 million and 74 million

respectively. Shandong comprises a geographical area of 156,700 sq. km with its

immediate neighbours, Hebei, Henan, Anhui and Jiangsu, ranging in size from

102,600 sq. km (Jiangsu) to 188,000 sq. km (Hebei), resulting in Jiangsu having

the highest population density amongst such provinces of approximately 720

persons per square kilometre.

Markets and business model

Animal Feed Business (Fuss Feed)

Under the ''11th Five-Year Plan'' (2006 to 2010), the PRC government indicated

its commitment to developing the agricultural sector with measures and policies

targeted at raising standards in, inter alia, the livestock industry. An

increasingly affluent PRC populace is driving demand for livestock, with a

growth in the number and size of farms benefiting the animal feed industry.

Annual production of animal feed in 2005 was approximately 100 million tonnes

with an estimated market value of approximately RMB274 billion (approximately

#17.6 billion at the current exchange rate).

Fuss Feed's business model involves the manufacture of three generic categories

of animal feed; namely Premix, Concentrate Feed and Compound Feed by an

experienced workforce for sale via a large distribution network. For the year to

31 December 2006, sales of animal feed products accounted for approximately 54.9

per cent. of the Full Fortune Group's total revenues.

Fuss Feed currently has two fully automated manufacturing lines with a combined

annual production capacity of 124,800 tonnes. One line is dedicated to Premix

and is currently producing approximately 17,000 tonnes per annum (approximately

58.7 per cent. of its designed production capacity) and the other is for

Concentrate Feed and Compound Feed currently producing approximately 45,000

tonnes per annum (approximately 46.7 per cent. of its designed production

capacity). The manufacturing process and equipment used provide the capability

for Fuss Feed to vary the formulations produced and therefore respond to

variations in customer orders and market demand. Raw materials, comprising

Energy Sources and Protein Sources, are sourced from a broad supplier base in

Weifang and neighbouring cities, while Additives (being vitamins, minerals and

medicinal drugs) are obtained from either local pharmaceutical companies or

foreign multinational corporations based in the PRC.

Fuss Feed's main target market is Shandong, although its products are also sold

in the neighbouring regions of Anhui, Jiangsu, Hebei and Henan. Shandong is one

of the largest agricultural and livestock provinces in East China, with a

population of approximately 91 million people. Located in the lower reaches of

the Yellow River, Shandong borders the Bo Sea and the East China Sea and is one

of China's leading producers of grain, cotton, peanuts, soya beans, vegetables,

fruit, meat and aquatic products. Its livestock industry is characterised by

farms that are generally run as small scale enterprises with low levels of

technological sophistication.

Fuss Feed principally sells its animal feed to distributors that, in turn, sell

it on to end users. It maintains a team of distribution channel managers, who

manage the distribution network. As at 31 December 2006, Fuss Feed had 238

distributors, mostly comprising small distributorships located in neighbouring

villages or towns.

The New Board believes that Fuss Feed's offering of compound, premix and

concentrate product ranges provides flexibility for it and its customers. Fuss

Feed's main strategy is to focus on Premix where the vitamin, mineral and

nutrition mix is formulated. Over the last decade, the company has accumulated a

large database of such formulations. As a result Fuss Feed is able to adapt its

planned production volumes to meet market trends, customer demand, seasonal

changes and local conditions and thereby achieve the most cost effective

solution for its customers. It also permits local distributors to buy their own

ingredients, such as Energy Sources, for example coarse grains like oats, wheat

and maize (which act as the staple carbohydrates for animals) from local

sources, thereby enabling them to minimise their transportation costs, which are

a major component of their overall product cost.

The majority of Fuss Feed's customers pay in cash on collection of the products

directly from the factory. Fuss Feed monitors and reviews the performance of its

distributors on an annual basis, based on the achievement of pre-agreed

objectives and offers rebates amounting to between four and six per cent. of

sales, depending on the type of product sold and an annual rebate of 0.5 to 2.5

per cent. for sales above RMB1,000,000 (approximately #65,350), in accordance

with a rebate scheme introduced in January 2007.

In addition, Fuss Feed provides small and medium sized farming enterprises in

Shandong with veterinary advice and nutrition education services. Since 2002,

Fuss Feed's marketing efforts have focused on direct education and training of

such end users rather than broad based advertisements and promotions.

Accordingly, the majority of its sales personnel are well trained in areas such

as Additives composition, common livestock ailments and the prevention and

treatment of common animal diseases. This, the New Board believes, enables them

to advise end customers, alongside Fuss Feed's specialist veterinary employees,

on the best usage of Fuss Feed's products, which engenders loyalty amongst both

distributors and customers.

In terms of product development, Fuss Feed uses its in-house technical knowledge

and expertise to formulate feeds that the New Board believes balance cost with

nutritional content. Since 2002, Fuss Feed has also been collaborating with the

research department of Shandong Agriculture University on livestock nutrition

studies. Its proprietary database of past varieties of formulated feeds,

technical and reference data is used to facilitate its research and development

activities, and it tests the yield efficacy of new products in controlled small

farm environments.

Condiments Business (Fu-Rich)

The condiments industry is one of the fastest growing segments within the PRC's

food industry reflecting the increasing purchasing power of Chinese consumers.

Annual sales of condiments are estimated to have grown from RMB59 billion in

2004 to RMB100 billion in 2006 (approximately #6.4 billion).

Fu-Rich currently produces a wide range of products that can be divided into

three main categories: soya sauce, vinegar and bean paste. Its various different

grades of soya sauce, types of vinegar and flavours of bean paste, represent

approximately 50 to 60 products that are produced under its ''Fushi'' and ''

Fushi Hao Tai Tai'' brand names.

In addition, Fu-Rich sells, under the same brand names, other food products

sourced from third party manufacturers or suppliers. These products include

pickled products, fungi products, chilli oil and flavour-enhancers such as MSG

and chicken bouillon seasonings. The New Board believes that the sale of such

third party products serves to:

1) increase Fu-Rich's existing product range;

2) capitalise on Fu-Rich's existing distribution channels; and

3) improve customer recognition for the 'Fushi' or 'Fushi Hao Tai Tai' brands.

For the year to 31 December 2006, sales of condiments products accounted for

approximately 45.1 per cent. of the Full Fortune Group's total revenues. The

approximate breakdown of condiments sales for the 2006 financial year by product

category is: soya sauce (37.9 per cent.), vinegar (29.7 per cent.), bean paste

(30.5 per cent.) and other (1.9 per cent.).

Fu-Rich's current factory has a total built-up area of approximately 17,663

sq.m. and houses 107 fermentation pools, two bottle packaging lines, a

micro-organism cultivation centre (for example, yeast, mould and bacteria), a

natural drying room, a research and development centre and a quality control

centre.

Fu-Rich's three main fully automated production lines are as follows:

1) Soya sauce: as at December 2006 producing in the region of 27,000 tonnes per

annum (54 per cent. of its designed production capacity);

2) Vinegar: as at December 2006 running at approximately 20,000 tonnes per

annum (67 per cent. of its designed production capacity); and

3) Bean paste: as at December 2006 running at approximately 13,000 tonnes per

annum (65 per cent. of designed production capacity).

Fu-Rich utilises a hybrid production method for its soya sauce and vinegar

products, combining traditional techniques with modern technology and

fermentation techniques so as to maintain the rich flavour and taste while

increasing product yield. The production cycle for both soya sauce and vinegar

is typically between 25 to 180 days, depending on the ingredients used and taste

to be achieved. Bean paste production is a faster process requiring between 15

to 40 days, again dependent on the ingredients used and taste requirements. Raw

ingredients (mainly soya bean, wheat and flour) are sourced from a broad base of

suppliers.

Fu-Rich maintains a high level of production control and in April 2007, obtained

GB/T 22000-2006/ISO22000:2005 certification for its production process in soya

sauce, vinegar and bean paste.

Fu-Rich is currently building a new manufacturing facility in Shou Guang City

with an estimated capacity of 50,000 tonnes per annum which the New Board

expects to be completed in June 2008. Fu-Rich intends to use this facility to

manufacture premium grade soya sauce, which takes approximately three to five

months to produce, using technology from international suppliers. The New Board

expects the new factory to commence shipping products in the last quarter of

2008.

Fu-Rich's primary market is Weifang but it also sells to other cities in

Shandong, as well as to neighbouring provinces including Henan, Jiangsu, Anhui,

Hebei, Tianjin, Beijing and Liaoning. The New Board believes that Fu-Rich holds

a leading market position in Weifang and a significant share of the wider

Shandong marketplace. For the year to 31 December 2006, sales to provinces

outside Shandong accounted for approximately 16.9 per cent. of Fu- Rich's total

revenues.

Fu-Rich sells its products via a network of distributors, retailers and

supermarket outlets rather than directly to end consumers. As at 31 December

2006 it had 205 distributors and retailers and numerous outlets of large and

medium sized supermarket chains in ten provinces and municipal cities in the

north-eastern region of the PRC, including Wal Mart, Carrefour, Shiji Lianhua

and Jialejia. Depending on the locality of the supermarket and any existing

relationship between the supermarket and an existing distributor, Fu-Rich's

preference is to supply supermarkets directly, in order to benefit from its

greater bargaining power. Fu-Rich typically provides credit terms of 30 to 45

days for its supermarket customers and collects cash in advance from its

distributors.

Fu-Rich uses different types of packaging according to the consumer market

segment being targeted, adopting for example, disposable bottles and barrels for

the mass market and ornate gift boxes for the high end consumer. The New Board

believes that such differentiation enables Fu-Rich's products to appeal to a

wide range of consumers and allows it to capture a number of different market

segments.

Fu-Rich employs an in-house team of research and development specialists,

knowledgeable in fields such as micro-organism cultivation and quality control,

who seek to develop improved industrial and cultivating technologies (for

example, experimenting with different strains of micro-organisms, temperature

controls and humidity levels) to enhance the traditional distinctive aroma,

taste and quality of Fu-Rich's products while minimising production times. It

also collaborates with the College of Life Science, Shandong University on

research into biological and foodstuff issues.

Summary financial information on the Full Fortune Group

A financial summary for the Full Fortune Group for the three financial years

ended 31 December 2006, which has been extracted without material adjustment

from, and should be read in conjunction with, the audited historical financial

information set out in the Admission Document, is set out below:

Year ended Year ended Year ended

31 December 2004 31 December 2005 31 December 2006

#000s #000s #000s

Revenue 8,978 13,870 19,273

Gross profit 3,077 4,314 6,771

Gross margin (per cent.) 34.27 31.10 35.13

EBITDA 2,988 4,172 6,454

Profit before taxation 2,619 3,834 6,077

Profit after taxation 1,971 2,838 4,437

Net margin (per cent.) 21.95 20.46 23.02

Cash and cash equivalents 2,337 3,799 3,656

Net assets 4,820 6,997 10,545

For the six months ended 30 June 2007, the Full Fortune Group has traded in line

with expectations, with revenue of #10.85 million and profit after taxation of

#2.62 million compared to #8.04 million and #1.85 million respectively for the

prior year equivalent period. The increase in revenue was mainly due to an

increase in demand for Premix in Fuss Feed and a general increase in demand for

Fu-Rich's products. The gross margin for the six months ended 30 June 2007 of

approximately 38.88 per cent. (2006: 36.11 per cent.) improved principally due

to price increases implemented at the end of 2006 and during the period. As at

30 June 2007, the Full Fortune Group had cash and cash equivalents of

approximately #3 million.

It is important that you do not rely solely on the key or summary information

shown above or elsewhere in this announcement. This announcement should be read

as a whole.

Competition

The New Board believes that the Full Fortune Group's in-house expertise and

experience, together with its extensive network of distributors, its scale of

operations, current and planned future capacity and ability to offer quality

products catering for a wide range of customer tastes and requirements, serve to

differentiate it from its competitors.

Animal Feed Industry

The animal feed industry in the PRC is fragmented and highly competitive, with

low barriers to entry. This is a reflection of the industry's low level of

technical sophistication and several government-funded initiatives to develop

the agricultural sector. The New Board believes that as end customers are

typically price sensitive, the use of low product pricing to penetrate the

market is a common practice. However, the New Board believes that end customers

are also increasingly influenced by product brand names and associated quality

perceptions.

The New Board further believes that as Chinese farmers become more sophisticated

and large domestic corporations enter the livestock industry by setting up

large-scale farms, it is expected that the quality and nutritional value of

animal feed will play a bigger role in the end customers' purchasing decisions.

As such, the New Board believes that the Full Fortune Group is well placed vis-a

'-vis its competitors due to its long-standing emphasis on the nutritional

aspects of its products.

The animal feed industry also contains many state-owned and privatised

companies, which are typically large scale and focus mainly on the production of

Compound Feed.

The New Board believes Fuss Feed to be one of the larger animal feed

manufacturers in Shandong and regard the following companies to be its main

competitors:

* Liu He Feed: a state owned enterprise and one of the largest companies

in Shandong focused on the manufacture of Compound Feed;

* Zhong Ji Feed: founded in 1987, this is Fuss Feed's closest competitor

producing Premix, Concentrate Feed and Compound Feed and was one of the first

animal feed companies to be established in Shandong;

* Huan Shan Feed: located in Weihai, Shandong, focused on the manufacture

of Compound Feed for pigs; and

* Pu Rui Na Feed: operates from Yantai, Shandong, focused on the

manufacture of Concentrate Feeds for pigs.

The New Board believes that the Full Fortune Group has a significant competitive

advantage when compared to the aforementioned companies, as in their opinion few

competitors have the track record, brand awareness, breadth of nutritional and

veterinary experience, product range and flexibility required to service the

varying customer demands and changing trends in the livestock industry.

Condiments Industry

Competition in the PRC's condiments industry has generally been restricted to

the immediate locality, since each region has its own taste preferences and

local brands, which dominate their markets due to their long standing and

operating history. Accordingly, many operators have found it difficult to expand

beyond their local region.

However, the rising affluence of consumers in the PRC has resulted in an

increase in both competition and opportunities, with customers becoming more

adventurous and demanding in their tastes and willing to spend more on

purchasing higher quality products. This has led to the growth of new

competitors, encouraged existing companies to expand into new regions and

attracted the entry of well-known international brands. The New Board believes

that, in the light of such enhanced competition, customers' brand awareness is

increasingly becoming a key differentiating factor in their buying decisions,

with advertising campaigns and the creation of extensive distribution networks

now seen to be the main driver for many market participants.

The New Board considers the following companies to be Fu-Rich's main

competitors:

* Yan Tai Xin He: focuses on bean paste and soya sauce;

* Zi Bo Qiao Xifu: concentrates on soya sauce, vinegar and pickled

vegetables;

* Jinan De Xin Zhai: makes vinegar, soya sauce, bean paste, rice wine and

pickled products;

* Qingdao DengTa: makes soya sauce and vinegar, as its primary products;

and

* Zhoucun Yutu: produces soya sauce, vinegar, biscuits and confectionery.

The New Board further believes that there are a number of other condiments'

manufacturers that are smaller in size and focused principally on selling to

their respective local markets.

The New Board believes that Fu-Rich has a number of competitive strengths,

including strong brand recognition, a well established distributor and retail

network, experienced and long serving management, a proven hybrid production

process and intellectual property, including trademarks and proprietary strains

of bacteria used in the fermentation process.

Future Strategy

New Facilities in Shou Guang City

At present, Fu-Rich operates from an 28,294 sq.m. site in Weifang City, with a

total built-up area of approximately 17,663 sq.m. The majority of the

production lines at Fu-Rich are currently operating at close to their full

design capacities.

Accordingly, in order for the Full Fortune Group to be better positioned to

service future anticipated growth in demand for the Enlarged Group's products,

new premises are currently in the course of construction at a site in Shou Guang

City.

The land use rights cover an area of 199,657 sq.m. and the Full Fortune Group

has paid a deposit for rights to an adjoining land area of 67,009 sq.m. for

possible future expansion. Construction is expected to be completed in mid 2008

when the new site will become the Full Fortune Group's corporate headquarters

and Fu-Rich will re-locate its soya sauce production to a new purpose built

plant, thereby improving capacity for vinegar and bean paste production at the

existing Weifang City facility. The total cost of these new premises is

currently expected to be approximately RMB256 million of which RMB111 million

has been expended to date, funded in part by recent new equity subscriptions

from third party investors.

Animal Feed Business

In 2004, Fuss Feed embarked on a deliberate strategy to expand into the

neighbouring provinces around Shandong, with the selective appointment of

preferred distributors. As at 30 June 2007, it had a total of 13 distributors

located in Henan, Anhui, Jiangsu and Hebei. While the contribution from such

neighbouring provinces was only approximately 2.4 per cent. of the Full Fortune

Group's total animal feed revenues in its financial year ended 31 December 2006,

the New Board believes that there is significant potential to grow revenues from

these territories now that the Full Fortune Group has an established foothold.

Accordingly, Fuss Feed intends to continue its expansion in the north-eastern

part of the PRC. The New Board believes that Fuss Feed will be able to improve

its distribution network by gradually appointing more distributors, as well as

providing regular support to its existing distributors in terms of animal

nutrition training and advice. By hiring and training additional sales channel

staff with veterinary knowledge and experience to visit farming communities in

neighbouring provinces, the New Board believes that it should be possible to

educate their populace as to the importance of animal nutrition and healthcare

whilst increasing awareness of the Full Fortune Group's ''Fushi'' brand.

Fuss Feed also intends to increase sales of its Premix and Concentrate Feed to

large farms and Compound Feed manufacturers, which are able to grow or buy the

Energy Sources themselves, by establishing a dedicated sales team to target such

customers. The New Board believes that this strategy will allow Fuss Feed to

benefit from greater economies of scale and maintain its competitiveness. By

targeting these two groups, rather than competing directly with them, the New

Board believes that Fuss Feed can seek to reduce and limit the risks associated

with expansion into new markets.

In terms of research and development, Fuss Feed intends to hire additional staff

to complement its existing animal nutrition research team. It will continue its

efforts to improve its animal feed formulations and keep abreast of new

developments in bio-technology and changes in climate, prices and type of

livestock. It also intends to continue to expand its collaboration efforts with

local universities to improve its formulations.

Condiments Business

Fu-Rich will seek to increase its production volumes and is currently in the

process of establishing a new 50,000 tonne capacity soya sauce processing plant

at the Full Fortune Group's new premises in Shou Guang City, which the New Board

expects to be completed in June 2008. This new plant is expected to produce a

higher grade of soya sauce to meet the requirements of a more demanding and

affluent Chinese population and which may also be suitable, in the longer term,

for export to overseas markets.

Fu-Rich will also seek to continue to broaden its customer base to regions

outside Shandong, which have a combined population in excess of 450 million, by

increasing the number of regional distributors to capture market share. The New

Board believes that expansion of Fu-Rich's distribution network via supermarket

channels will be a key factor in achieving growth in sales both within the PRC

and internationally, especially for its premium priced branded products.

Research and development activities will be maintained to extend Fu-Rich's

product range, including exploring potential healthier alternatives and organic

produce. In addition, further new products may potentially be sourced from third

party manufacturers.

Xianka

Xianka, which has been under development by Fu-Rich's in-house research and

development team, is potentially a new seasoning product which the New Board

believes can enhance flavour when cooking food. Unlike traditional seasoning

products that consist mainly of artificial chemical compounds, Xianka's raw

materials and ingredients are extracted principally from marine plants such as

seaweed and kelp. These marine plants contain natural ingredients such as amino

acid and proteins and fewer artificial compounds. The New Board believe Xianka

will become a substitute product for MSG and chicken bouillon seasoning,

especially given its organic nature and origin. In 2006 the PRC produced 1.35

million tonnes of MSG with a market value of approximately RMB13.7 billion

(approximately #878 million at the current exchange rate) and 150,000 tonnes of

chicken bouillon seasoning with a market value of approximately RMB3 billion

(approximately #192 million at the current exchange rate).

Xian Meishen Technology, a newly formed company wholly owned by Mr Fu Guoping

(the co-founder of Fuss Feed), intends to produce, market and sell Xianka

products from early 2008 and has entered into an agreement with Fu-Rich in

respect of its rental of floor space at the new Shou Guang City premises and the

use of Fu-Rich's established distributorship and retail networks following the

sale of the Xianka business (including the licensing of intellectual property

rights related to the Xianka trademarks and know-how) by Fu-Rich to Xian Meishen

Technology. The Full Fortune Group will have the right of first refusal to

represent and sell Xianka based products and the right to appoint two directors

to the board of Xian Meishen Technology.

It should be stated that the Acquisition does not include the rights to the

Xianka Business which will be transferred before Completion to Xian Meishen

Technology. However, as part of the Acquisition, the Company has secured a call

option, exercisable by itself or by any one of its subsidiaries at the direction

of the Company at any time during the two year period following Completion, to

acquire the entire issued share capital of Xian Meishen Technology or any other

company which carries on all or any part of the Xianka business for a maximum

cash consideration of RMB80 million (approximately #5.1 million at current

exchange rates). Further details of this option are set out in the Admission

Document.

Growth via acquisitions

The Enlarged Group may potentially consider growing the business via

complementary acquisitions of both animal feed and condiments businesses, with

good brands and established customers and/or distribution networks, either

within the PRC or overseas, where opportunities present themselves to create

value for Shareholders.

5. Current trading and prospects for the Enlarged Group

Financial information on Vestpa for the period ended 30 September 2007 is set

out in the Admission Document. Since 30 September 2007, the Company's only

activity has been to search for and evaluate suitable acquisition opportunities

in line with its investment strategy and to enter into the agreements, details

of which are set out in the Admission Document published today.

Financial information on the Full Fortune Group for the three years ended 31

December 2006 and the six months ended 30 June 2007 is also set out in the

Admission Document published today.

The New Board is optimistic as to the Enlarged Group's prospects, based on the

combination of the Acquisition, the Subscriptions and their expectations for the

continued growth of the Full Fortune Group, both organically and by acquisition.

6. Directors, Proposed Directors, senior management and employees

At the General Meeting, resolutions will be proposed, conditional on having

obtained Shareholders' approval for the Acquisition and Admission to, inter

alia, appoint Raphael Tham, Feng Bo, Frank Chau and Derek Marsh as directors of

the Company upon Admission. With effect from Admission, it is proposed that both

James Cane and Thomas Vaughan will resign from the Board. John McLean will

remain on the board and become Non-executive Chairman. He will also be the

designated appointee of Albany. Brief biographical details of the Directors,

Proposed Directors and senior management are set out below.

Directors

The current composition of the Board of Vestpa is as follows:

John McLean (Executive Director)

John McLean, aged 54, is Chairman of Albany Capital plc, which he, with three

other colleagues, founded in 2006 to invest in pre-IPO and other investments. He

is also the Chief Executive Officer of Fairfax Classical Properties Limited, a

company that he co-founded in 2003, which builds deluxe houses in the South of

England. John has had extensive business experience in a variety of sectors,

including retail, branded products, property investment and development,

textiles, mobile telephony, cable TV, manufacturing, licensing and logistics. He

has managed operations globally, with specific expertise in China, Australia,

the USA, Canada and Europe. In 1998, he was appointed by Gamma Holdings NV to

carry out a strategic review of their UK interests, including Sanderson, the

textile and wallpaper company. John remained with Sanderson until 2003, serving

as its managing director to implement a turnaround and disposal plan. From 1992

to 1996, he was employed as General Manager with ICS and co-led a management

buy-out of the company with 3i, prior to its successful disposal to Hays plc in

1996. John has a long track record in the development of growing companies and

has operated as both managing director and finance director. John is a Chartered

Accountant and was formerly with Coopers & Lybrand in both London and New York.

James Cane (Non-executive Director)

James Cane, aged 55, has been a chief executive and finance director in both

listed and private equity backed businesses, and was, until its merger with the

Portman Building Society, a non-executive director of the Lambeth Building

Society and a member of its audit and assets & liabilities committees. James is

a Chartered Accountant who trained with Arthur Young (now Ernst & Young), and is

a member of the Securities Institute. He has operated through a consultancy

business for nearly thirty years, and has been a management consultant and

business adviser for over thirty years. Earlier this year, he finished a two and

a half year project with a UK-centric mid market private equity buyout fund,

having resigned as the chief executive and finance director of the OFEX listed

Ashley House plc in 2004. James was a divisional managing director and finance

director at Westminster Health Care before and after its buyout by a private

equity consortium in 1999, followed by roles as the operations and finance

director of a private equity advisory firm between 2000 and 2002. James is

currently a senior adviser to a leading emerging markets private equity fund

manager with 14 offices worldwide and over US$3.5 billion under management.

Thomas Vaughan (Non-executive Director)

Thomas Vaughan, aged 59, co-founded, with his brother, Oliver, Juliana's

Holdings Plc which in 1966 was the world's largest discotheque entertainment

group. Following its #30 million sale to Wembley Leisure Limited in 1988, Tom

became an executive director of Wembley Leisure. In 1994 Tom was appointed

chairman of the newly-formed Gander Holdings Plc, a London based property

company specialising in the acquisition and development of prime Kensington and

Chelsea residential real estate. In January 2000, Tom became a director of the

London Academy of Music and Dramatic Art. In April 2004, Tom was appointed a

director of ART VPS Limited, a Cambridge based technology company and from

January 1996 until 30 March 2007, he was a director of Corporate Synergy Group

Plc (renamed Blue Oar Plc).

Proposed Directors

Raphael Tham Wai Mun (Proposed Chief Executive Officer)

Raphael Tham Wai Mun, aged 37, is currently a director of Full Fortune and

Tastyfood Holdings Limited, a listed company on the Singapore Exchange. He has

experience in various businesses within the technology, construction, retail and

finance industries and has been involved in general management, strategic

development, financing and corporate restructuring. Prior to joining Full

Fortune, Mr Tham was the senior vice president of International Financial

Network Holdings Limited, a Hong Kong based, GEM listed company involved in

securities, corporate finance advisory and other related services and was the

country manager of their Singapore subsidiary. Mr Tham has also founded and run

other businesses and served on the board of listed companies in Singapore. He is

also currently a non-executive director of Byte Power Group Limited, an

Australian listed company. Mr Tham started his career with the Economic

Development Board of Singapore and holds a Bachelor of Arts (Economics) from the

National University of Singapore. Mr Tham is fluent in both English and

Mandarin. Subject to and with effect from Admission, Mr Tham has entered into a

service agreement with Full Fortune and a letter of appointment with the

Company, details of which are set out in the Admission Document.

Feng Bo (Proposed Chief Operating Officer)

Feng Bo, aged 38, graduated from the Beijing Agriculture Engineering University

in 1991 with a Bachelor of Science. She then completed her graduate course in

International Trade at China Ocean University in 2003. She is also a committee

member of the China Animal Husbandry and Veterinary Institute of Animal

Nutrition. She joined Fuss Feed in 1994 and subsequently became its General

Manager. Feng Bo is currently a director of Fuss Feed, its legal representative

and General Manager. Subject to and with effect from Admission, Ms Feng has

entered into an employment agreement with Fuss Feed, letters of appointment with

Vestpa and Full Fortune, as well as 'service agreements' which are equivalent to

letters of appointment with Fuss Feed and Fu-Rich, details of which are set out

in the Admission Document.

Frank Chau (Proposed Chief Financial Officer)

Frank Chau, aged 35, has more than ten years experience in audit, corporate

finance and financial management in Singapore, Hong Kong and mainland China. Mr

Chau was the Financial Controller of a Singapore mainboard listed company prior

to joining Full Fortune. Mr Chau started his career with the Hong Kong member of

Grant Thornton International and holds a Master's degree in Business

Administration from the University of Adelaide, Australia. Mr Chau is a fellow

member of the Association of Chartered Certified Accountants. Mr Chau is fluent

in both English and Mandarin. Subject to and with effect from Admission, Mr Chau

has entered into a service agreement with Full Fortune and a letter of

appointment with the Company, details of which are set out in the Admission

Document.

Derek Marsh, CVO (Proposed Non-executive Director)

Derek Marsh, aged 61, has thirty-eight years of Government experience, including

with the British diplomatic service in East Asia where he was Deputy British

Ambassador in Seoul from 1997 to 2001 and British Trade Representative in Taipei

from 2002 to 2005. His other Government experience includes the following areas:

export promotion, aerospace industry, large-scale information business, defence

procurement and military operations. Derek was a non-executive director of Bovis

Homes Limited between 1992 and 1994. Bovis Homes Limited was a subsidiary of the

P&O Group plc. He is currently a non-executive director of the AIM quoted HaiKe

Chemical Group Limited, based in the Shandong Province. Derek graduated from the

Royal College of Defence Studies, London and the NATO Defence College, Rome and

holds an MA from The Queen's College, Oxford. Subject to and with effect from

Admission, Mr Marsh has entered into a letter of appointment with the Company,

details of which are set out in the Admission Document.

It is intended that a further director shall be appointed as soon as practicable

following Admission, such appointee to be subject to the prior approval of the

Chairman of the Company.

Following Completion, the New Board will review the composition of the Board on

a regular basis.

Senior Management

In addition to the Directors and Proposed Directors, details of key senior

management personnel within the Enlarged Group immediately following Completion

are set out below:

Lin Qi

Lin Qi, aged 38, graduated with a law degree from the East China University of

Politics and Law in 1991. Before joining Fu-Rich, he worked in Xinjiang Korla

Justice Bureau from 1990 to 1992. He then worked in the condiments industry and

subsequently was one of the founders of Fu-Rich in 2001. He has over ten years

of experience in the condiments industry from production to sales and marketing.

He is currently the General Manager of Fu-Rich in charge of the day-to-day

operations, strategic planning, product development, food technology. He is

currently pursuing his Executive-MBA with Tsing Hua University.

Feng Lei

Feng Lei, aged 37, is an economics graduate from Shandong University of Finance

in 1992. In 1992, he was the assistant to the director of Zhucheng Cotton

Plaiting Factory before being promoted to assistant factory director in 1995. In

1997, he joined Fuss Feed as a Sales and Marketing Manager and became the Deputy

General Manager in 2002. He also completed a part-time management course at

Tsing Hua University in 2004.

Sang Ming Gang

Sang Ming Gang is a certified public accountant of the PRC. Mr Sang graduated

from the Shandong Economics University in 1989. He started his career with the

Treasury Bureau of Fang Zi district in 1989 until 1993. He also served as an

officer in the tax, finance and price investigation offices of Fang Zi district

from 1993 to 1995. From 1995 to 2002, he worked in a CPA firm. Before joining

the Full Fortune Group, Mr Sang was the department head of the asset management

department of Shandong Dong Liang Group. He is currently the Full Fortune Group

Chief Accountant.

Yin Hui

Yin Hui, aged 37 graduated from Dongbei University of Finance & Economics with a

bachelor of accounting in 1992. She worked in the accounting department in the

Shandong Huarun Group f