Morgan Stanley Private Equity Invests in Anhui Conch Cement

Hong Kong —

MS Asia Investment, an entity controlled by Morgan Stanley Private Equity Asia (“MSPEA”), today announced the signing of a definitive agreement to acquire shares in Anhui Conch Cement Company Limited (“Conch”), China’s largest cement company. An investor consortium led by MSPEA will acquire a 14.3% stake in Conch from its parent company Anhui Conch Group. This investment is subject to approval by various government bodies and regulators in China.

“We are proud and excited to have the opportunity to invest in an industry leader like Conch. The company’s strengths and competitive advantages have been proven by its outstanding performance over many years. By leveraging the global resources of Morgan Stanley and with the support of the Anhui Government, we look forward to working with Conch’s strong management team to further develop and grow the company,” said David Liu, Managing Director and Co-Head of Morgan Stanley Private Equity Asia.

The consortium also includes the International Finance Corporation (“IFC”), the private sector arm of the World Bank Group.

Anhui Conch Cement Company Limited is the largest cement producer in China and the fifth largest in the world by capacity. It is one of the leading suppliers of high-grade cement in the coastal areas in the eastern and southern regions of the PRC. The “Conch” trademark was the only brand name in the PRC cement industry designated as a “Famous Brandname in China”. Conch sold more than 38 million tons of cement products in the first three quarters of 2005, a 56% increase from the same period in 2004. Conch is leading the consolidation and modernization of the Chinese cement sector by employing the energy-efficient new suspension pre-heater, or NSP, technology. Conch was listed on the Hong Kong Stock Exchange in 1997 and the Shanghai Stock Exchange in 2002.

Morgan Stanley Private Equity Asia is one of the leading private equity investors in Asia, having invested in Asia since 1993. The group has made a number of successful investments in businesses throughout Asia, including Ping An Insurance, Mengniu Dairy, Nanfu Battery, Hengan International, Paradise Retail, Belle International, eAccess, Landmark ITMC and HTL International. Morgan Stanley is a global financial services firm and a market leader in securities, investment management and credit services. With more than 600 offices in 28 countries, Morgan Stanley connects people, ideas and capital to help clients achieve their financial aspirations.

Poling Cheung

Media Relations

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