1. INTRODUCTION

This announcement is dated 28 February 2005.

On behalf of the Board of Directors of Three-A ("Board"), AmMerchant Bank Berhad ("AmMerchant Bank") is pleased to announce that the Company is proposing a bonus issue of 35,000,002 new ordinary shares of RM0.20 each ("Shares") on the basis of one (1) new Share for every four (4) existing Shares held ("Proposed Bonus Issue").

2. DETAILS OF THE PROPOSED BONUS ISSUE

2.1. The Proposed Bonus Issue

The Company is proposing to undertake the Proposed Bonus Issue of 35,000,002 new Bonus Shares to be credited as fully paid-up to its shareholders on the basis of one (1) new Bonus Share for every four (4) existing Shares held on an entitlement date to be determined later by the Board.

The Proposed Bonus Issue shall be capitalised from the revaluation reserves of the Company, which is facilitated through the revaluation of investment in subsidiary. As at 31 December 2004, the revaluation reserves of Three-A are RM13.8 million. Please refer to Table 1 below as shown in the attachment for details of capitalisation for the Proposed Bonus Issue.

2.2. Rationale

The Proposed Bonus Issue will increase the capital base of Three-A to a level which will better reflect the Group’s current scale of operations. It rewards shareholders for their continuous support of Three-A and gives them greater participation in Three-A’s equity in terms of number of shares held. Simultaneously, the increased number of the shares in issue is expected to improve the liquidity of the shares in the Market.

2.3. Ranking of New Bonus Shares

The Bonus Shares shall upon allotment and issue, rank pari passu in all respects with the existing shares of the Company except that they shall not be entitled to dividends, rights, allotments and/or any other distributions, the entitlement of which is prior to the allotment of the new shares.

In determining the shareholders’ entitlements to the Proposed Bonus Issue, fractional entitlements will be disregarded and shall be dealt with in such manner as the Board in their discretion think expedient and in the interest of the Company.

3. FINANCIAL EFFECTS OF THE PROPOSED BONUS ISSE

The effects of the Proposed Bonus Issue are set out below:-

4.1. Share Capital

The share capital of Three-A will be enlarged from RM28,000,002 to RM35,000,002 comprising 175,000,012 Shares upon completion of the Proposed Bonus Issue as shown in Table 2 in the attachment below.

4.2. Net Tangible Assets ("NTA")

The Proposed Bonus Issue will not have any material effect on the NTA of Three-A except that the NTA per Share will be correspondingly reduced as a result of the increase in the issued and paid-up share capital of Three-A upon completion of the Proposed Bonus Issue. The proforma effects of the Proposed Bonus Issue on the NTA are illustrated in Table 3 in the attachment below.

4.3. Earnings

The Proposed Bonus Issue will not have any material effect on the earnings of Three-A for the year ending 31 December 2005 except that the earnings per share (“EPS”) of the Group will be correspondingly reduced as a result of the increase in the Company’s issued and paid-up share capital upon completion of the Proposed Bonus Issue.

4.4. Substantial Shareholders

The Proposed Bonus Issue will not have any effect on the substantial shareholding structure in the Company as it is done on a rights basis to all shareholders of the Company. Accordingly, the number of shares held by each shareholder will increase proportionately.

4.5. Dividends

The Proposed Bonus Issue is not expected to have any material effect on the dividend policy of the Group. Any future dividends to be declared by the Group in financial year ending 31 December 2005 would be decided by the Board after taking into consideration amongst other, the future financial performance of the Group at that point in time.

5. DIRECTORS' AND SUBSTANTIAL SHAREHOLDERS' INTEREST

None of the Directors and substantial shareholders and/or persons connected to the Directors and substantial shareholders have any interest, either direct or indirect, in the Proposed Bonus Issue beyond their respective entitlement under the Proposed Bonus Issue arising from their shareholdings (if any) for which all existing shareholders of Three-A are entitled to.

6. CONDITIONS TO THE PROPOSED BONUS ISSUE

The Proposed Bonus Issue is subject to the Company obtaining approvals from the following:-

i) Bursa Securities, for the listing of and quotation for the new ordinary shares to be issued pursuant to the Proposed Bonus Issue;

ii) shareholders of Three-A at an Extraordinary General Meeting to be convened for the Proposed Bonus Issue; and

iii) any other relevant authorities.

An application will be made to the relevant authorities within two months from the date of this announcement.

7. DIRECTORS’ STATEMENT

Having considered the rationale for the Proposed Bonus Issue, the Board is of the opinion that the Proposed Bonus Issue is in the best interest of Three-A.

8. ADVISER

AmMerchant Bank has been appointed as Adviser for the Proposed Bonus Issue.