SET Announcements

(Translation) No. CK-07-0000-AUD-L-0004 April 9, 2007 Re: Opinion of the Audit Committee on Acquisition and Disposition of Shares held by CH. Karnchang Public Company Limited in Pathum Thani Water Co., Ltd. Attn: Shareholders CH. Karnchang Public Company Limited Reference is made to the fact that the Board of Directors of CH. Karnchang Public Company Limited, in its Meeting No. 4/2007 on March 26, 2007, resolved to grant approval for the Company to sell a total of 5,567,371 ordinary shares or not more than 46.39 percent of the registered capital (after the capital decrease) in Pathum Thani Water Co., Ltd. to Thai Tap Water Supply Public Company Limited, at the price not lower than Baht 332 per share or in the total value of not less than Baht 1,848,367,172. Furthermore, the Board of Directors also resolved to grant approval for the Company to propose this matter to the Meeting of Shareholders to consider the matter where Thai Tap Water Supply Public Company Limited, which is an affiliated company, would purchase the ordinary shares in Pathum Thani Water Co., Ltd. from the current shareholders as at the date on which the shares are really purchased and sold (except the Provincial Waterworks Authority), at the price not lower than Baht 332 per share and not more than Baht 365 per share. The disposition and acquisition of shares in Pathum Thani Water Co., Ltd. are to restructure the shareholding of Thai Tap Water Supply Public Company Limited before the initial public offering of its securities for the purpose of listing on the Stock Exchange of Thailand. Moreover, the transaction volume of the disposition of shares in Pathum Thani Water Co., Ltd., if calculated pursuant to the Stock Exchange of Thailand Notification, Re: Rules, Procedures and Disclosure on Disposition of Assets of Listed Companies, according to the transaction value basis, would represent 6.70 percent. As for the acquisition by Thai Tap Water Supply Public Company Limited of shares in Pathum Thani Water Co., Ltd., which represents a transaction volume of 14.16 percent, upon combination of the acquisition transaction during the past six months, the total transaction volume represents 18.66 percent which would fall on Type 2 Transaction. In this regard, the Company is required to prepare a report and disclose such transactions to the Stock Exchange of Thailand and to deliver written notice to its shareholders within 21 days from the date of disclosure to the Stock Exchange of Thailand. Thai Tap Water Supply Public Company Limited would acquire shares in Pathum Thani Water Co., Ltd. by way of purchasing such shares from the current shareholders, as the sellers, i.e., Mahasiri Siam Co., Ltd. and CH. Karnchang Holding Co., Ltd. which are major shareholders of CH. Karnchang Public Company Limited, the transaction value, if calculated pursuant to the Stock Exchange of Thailand Notification, Re: Rules, Procedures and Disclosure on Connected Transactions of Listed Companies, would represent more than three percent of the value of net tangible assets. Since the sellers (Mahasiri Siam Co., Ltd. and CH. Karnchang Holding Co., Ltd.), the major shareholders of CH. Karnchang Public Company Limited, enter into such transactions with their affiliated company (Thai Tap Water Supply Public Company Limited), such transactions are not deemed as connected transactions. However, to ensure transparency and avoidance of conflict of interest, the Company wishes to disclose information on such transactions to the Stock Exchange of Thailand and to hold the Meeting of Shareholders to seek approval of the transactions by the Company's shareholders with at least three-fourths of all votes of the shareholders or their proxies (if any) attending the Meeting and having the right to vote, exclusive of interested shareholders. Therefore, the Board of Directors has appointed Far East Securities Company Limited as its independent financial advisor to express an opinion on fair price and justifications of the transactions as well as providing its opinion to the Audit Committee and/or shareholders of the Company regarding the acquisition and disposition of assets and connected transactions of the Company. We, in our capacity of the Audit Committee of the Company, have considered such opinion rendered by Far East Securities Company Limited, as the Company's independent financial advisor, regarding the disposition of shares in Pathum Thani Water Co., Ltd. to Thai Tap Water Supply Public Company Limited, whereby the value of ordinary shares in Pathum Thani Water Co., Ltd. is appraised at the price equal to Baht 337.10-402.41 per share, which is higher than the selling price not les than Baht 332 per share and not more than Baht 365 per share, and is considered a transaction at a fair value and with justifications, namely, the price is appropriate as per the independent financial advisor's appraisal of the price of such ordinary shares. In this respect, the Audit Committee has no disagreement with the independent financial advisor's opinion, and the price not less than Baht 332 per share and not more than Baht 365 per share is the price range which is currently pending negotiation. In order to ensure the good faith, transparency and fairness in respect of the transactions on this occasion, the persons authorized to negotiate and fix the final price shall first propose the said final price to the Company's Audit Committee for inquiries and consideration of various details prior to executing such transactions. Please be informed accordingly. Very truly yours, (Mr. Vitoon Tejatussanasoontorn) Audit Committee Chairman (Mr. Thawansak Sukhawun) Audit Committee Member (Mr. Don Pramudwinai) Audit Committee Member