datacraft asia ltd dimension data holdings plc · 2008-09-22 · document dated 22 september 2008...

DOCUMENT DATED 22 SEPTEMBER 2008

THIS DOCUMENT IS ISSUED BY DATACRAFT ASIA LTD (THE “COMPANY” OR “DATACRAFT”). THIS DOCUMENT IS IMPORTANTAND REQUIRES YOUR IMMEDIATE ATTENTION. PLEASE READ IT CAREFULLY.

IF YOU ARE IN ANY DOUBT ABOUT THIS DOCUMENT OR AS TO THE ACTION THAT YOU SHOULD TAKE, YOU SHOULDCONSULT YOUR STOCKBROKER, BANK MANAGER, SOLICITOR, ACCOUNTANT, TAX ADVISER OR OTHER PROFESSIONALADVISERS IMMEDIATELY.

If you have sold or transferred all your issued ordinary shares in the capital of the Company, please forward this Document and theaccompanying Proxy Forms immediately to the purchaser or transferee or to the agent through whom the sale or transfer was effectedfor onward transmission to the purchaser or transferee.

The Singapore Exchange Securities Trading Limited assumes no responsibility for the correctness of any of the statements made, reportscontained or opinions expressed in this Document.

The action to be taken by you is set out on page 37 of this Document.

DATACRAFT ASIA LTD(Incorporated in the Republic of Singapore)

Company Registration No. 199301842Z

DIMENSION DATA HOLDINGS PLC(Incorporated in England and Wales under the

Companies Act 1985 with registered number 3704278)

DOCUMENT TO SHAREHOLDERS

IN RELATION TO

1. THE PROPOSED SCHEME OF ARRANGEMENT TO PRIVATISE DATACRAFT ASIA LTD UNDER SECTION210 OF THE COMPANIES ACT, CHAPTER 50 OF SINGAPORE; AND

2. THE PROPOSED CAPITAL DISTRIBUTION

Financial Adviser to Dimension Data Holdings plc

CAZENOVE & CO. (SINGAPORE) PTE. LIMITED(Incorporated in the Republic of Singapore)

Company Registration No. 199000557R

Independent Financial Adviser to the Independent Directors in relation to the Scheme

(Incorporated in the Republic of Singapore)Company Registration No. 197501605H

IMPORTANT DATES AND TIMES:

COURT MEETING

Last date and time for lodgement of Proxy Form : 13 October 2008 at 2.00 p.m.

Date and time of Court Meeting : 15 October 2008 at 2.00 p.m.

EXTRAORDINARY GENERAL MEETING

Last date and time for lodgement of Proxy Form : 13 October 2008 at 2.30 p.m.

Date and time of Extraordinary General Meeting : 15 October 2008 at 2.30 p.m., or as soon thereafter following theconclusion of the Court Meeting to be held at 2.00 p.m. on thesame day and at the same place (or its adjournment thereof)

Place of Court Meeting and ExtraordinaryGeneral Meeting

: Conrad Centennial Singapore,2 Temasek Boulevard,Singapore 038982

Your attention is also drawn to the expected timetable set out on page 9 of this Document and the notes thereunder.

DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

EXPECTED TIMETABLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

CORPORATE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

LETTER FROM THE BOARD TO THE SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . 11

1. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

2. BACKGROUND ON THE COMPANY AND DIMENSION DATA . . . . . . . . . . . . . . . . . . . 12

3. THE SCHEME. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

4. CAPITAL DISTRIBUTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

5. COURT MEETING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

6. EXTRAORDINARY GENERAL MEETING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

7. SUSPENSION AND DELISTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

8. ACTION TO BE TAKEN BY SCHEME SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . 25

9. ABSTENTION FROM VOTING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

10. DIRECTORS’ AND SUBSTANTIAL SHAREHOLDERS’ INTERESTS IN SHARES . . . . . 26

11. CONFIRMATION OF FINANCIAL RESOURCES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

12. INDEPENDENT FINANCIAL ADVISER TO THE INDEPENDENT DIRECTORS . . . . . . . 26

13. EXEMPTION RELATING TO DIRECTORS’ RECOMMENDATION . . . . . . . . . . . . . . . . . 28

14. INDEPENDENT DIRECTORS’ RECOMMENDATIONS . . . . . . . . . . . . . . . . . . . . . . . . . 30

15. RESPONSIBILITY STATEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

16. GENERAL INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

EXPLANATORY STATEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

1. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

2. RATIONALE FOR THE SCHEME. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

3. THE SCHEME. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

4. BASIS OF CASH CONSIDERATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

5. CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

6. REGULATORY APPROVALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

7. ACTION TO BE TAKEN BY SCHEME SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . 37

8. IMPLEMENTATION OF THE SCHEME AND THE CAPITAL DISTRIBUTION . . . . . . . . . 37

9. DIRECTORS’ AND SUBSTANTIAL SHAREHOLDERS’ INTERESTS . . . . . . . . . . . . . . . 41

10. OVERSEAS SCHEME SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

11. ADVICE OF THE INDEPENDENT FINANCIAL ADVISER . . . . . . . . . . . . . . . . . . . . . . . 42

12. DIRECTORS’ RECOMMENDATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

13. GENERAL INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

CONTENTS

1

APPENDIX 1: LETTER FROM PWCCF TO THE INDEPENDENT DIRECTORS . . . . . . . . 43

APPENDIX 2: LETTER FROM DIMENSION DATA TO THE SCHEME SHAREHOLDERS. 68

APPENDIX 3: GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129

APPENDIX 4: RELEVANT EXCERPTS FROM THE COMPANY’S ARTICLES OFASSOCIATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145

APPENDIX 5: AUDITED CONSOLIDATED FINANCIAL STATEMENTS OF THECOMPANY FOR FY 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155

APPENDIX 6: UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS OF THECOMPANY FOR Q3 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 209

APPENDIX 7: DELOITTE & TOUCHE LLP’S REPORT ON REVIEW OF INTERIMCONDENSED CONSOLIDATED FINANCIAL STATEMENTS TO THEMEMBERS OF DATACRAFT ASIA LTD FOR THE THREE-MONTHPERIOD AND NINE-MONTH PERIOD ENDED JUNE 30, 2008 . . . . . . . . . 222

APPENDIX 8: LETTER FROM PWCCF ON THE UNAUDITED CONSOLIDATEDFINANCIAL STATEMENTS OF THE COMPANY FOR Q3 2008 . . . . . . . . . 224

APPENDIX 9: THE COMPANY’S REPRESENTATIONS AND WARRANTIES . . . . . . . . . . 225

APPENDIX 10: DIMENSION DATA’S REPRESENTATIONS AND WARRANTIES . . . . . . . . 226

APPENDIX 11: PRESCRIBED OCCURRENCES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 227

THE SCHEME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 228

NOTICE OF COURT MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 236

NOTICE OF EXTRAORDINARY GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . 239

PROXY FORM FOR COURT MEETING

PROXY FORM FOR EXTRAORDINARY GENERAL MEETING

CONTENTS

2

In this Document, the following definitions apply throughout unless otherwise stated or the contextotherwise requires:

“Accelerated ExercisePeriod”

: The period commencing on the date of the Scheme CourtOrder and ending either on the expiry of 60 days thereafter orthe Effective Date, whichever is later (but not after the expiry ofthe relevant option period relating to an Option)

“ACRA” : The Accounting and Corporate Regulatory AuthoritySingapore

“Announcement” : The joint announcement made by the Company andDimension Data on the SGX-ST dated 22 July 2008 in relationto the Scheme and the Capital Distribution

“Announcement Date” : 22 July 2008, being the date of the Announcement

“Books Closure Date” : A date and time to be announced (before the Effective Date)on which the Transfer Books and the Register of Members ofthe Company will be closed to determine the entitlements ofScheme Shareholders under the Scheme and to the CapitalDistribution

“Business Day” : A day (other than a Saturday, Sunday or public holiday) onwhich commercial banks are open for business in Singapore

“Capital Distribution” : The capital distribution of US$0.24 in cash for each SchemeShare held by the Scheme Shareholders as at the BooksClosure Date, to be effected by way of the Capital Reduction

“Capital Distribution CourtOrder”

: The order of Court sanctioning the Capital Distribution

“Capital DistributionResolution”

: The special resolution to be proposed to SchemeShareholders at the EGM to approve the Capital Distribution

“Capital Reduction” : The cancellation of up to US$52,600,000 of the issued sharecapital of the Company without any cancellation of Sharespursuant to Section 78G of the Companies Act for thepurposes of facilitating the Capital Distribution, details of whichare set out in paragraph 4 of the Letter from the Board to theShareholders, on page 21 of this Document

“Cash Consideration” : The aggregate cash amount of US$1.33 to be paid in cash foreach Share transferred under the Scheme, comprising theScheme Price and the Capital Distribution

“Cazenove” : Cazenove & Co. (Singapore) Pte. Limited

“CDP” : The Central Depository (Pte) Limited

“Code” : The Singapore Code on Take-overs and Mergers, as amendedfrom time to time

“Controlled AssociatedCompany”

: An associated company of Datacraft over which Datacraft hascontrol

DEFINITIONS

3

“Committee” : The committee of Datacraft Directors which is duly authorizedby the Datacraft Board to administer the Datacraft ShareOption Schemes

“Companies Act” : The Companies Act, Chapter 50 of Singapore

“Company” or “Datacraft” : Datacraft Asia Ltd

“Court” : The High Court of the Republic of Singapore

“Court Meeting” : The meeting of Scheme Shareholders to be convened at thedirection of the Court, notice of which is set out on pages 236to 238 of this Document, and any adjournment thereof

“Datacraft Directors”,“Directors” or the“Datacraft Board”

: The directors of the Company as at the Latest PracticableDate

“Datacraft Asia ShareOption Scheme 1996”

: The share option scheme for the granting of Datacraft Optionsto the employees and executive directors of the DatacraftGroup, approved and adopted at an extraordinary generalmeeting of Datacraft held on 19 August 1996, as subsequentlyamended at extraordinary general meetings of Datacraft heldon 15 January 1998, 7 April 2000 and 20 January 2006

“Datacraft Asia ShareOption Scheme 2003”

: The share option scheme for the granting of Datacraft Optionsto the employees and directors of the Datacraft Group,approved and adopted at an extraordinary general meeting ofDatacraft held on 27 February 2003, as subsequentlyamended at an extraordinary general meeting of Datacraftheld on 20 January 2006

“Datacraft Scrip DividendScheme”

: The scrip dividend scheme, approved and adopted at anextraordinary general meeting held on 23 October 1998, assubsequently modified in an addendum to Shareholders dated11 January 2008, for the granting of Datacraft Shares toShareholders who, in respect of a qualifying dividend, haveelected to receive scrip in lieu of the cash amount of thatqualifying dividend

“Datacraft Share OptionSchemes”

: The Datacraft Asia Share Option Scheme 1996 and theDatacraft Asia Share Option Scheme 2003

“Datacraft Share Plan” : The share incentive scheme for the granting of DatacraftShares to employees and executive directors of eligible rank ofthe Datacraft Group, approved and adopted at anextraordinary general meeting of Datacraft held on 20 January2006

“Dimension Data” : Dimension Data Holdings plc

“Dimension Data Directors”or the “Dimension DataBoard”

: The directors of Dimension Data as at the Latest PracticableDate

“Dimension Data Group” : Dimension Data, its subsidiaries and associated companies

DEFINITIONS

4

“Dimension Data Long TermIncentive Plan”

: The long term incentive plan for the granting of DimensionData shares to employees and executive directors ofDimension Data and its subsidiaries, approved and adopted atan extraordinary general meeting of Dimension Data held on13 November 2004

“Dimension Data Options” : Options to subscribe for new Dimension Data Shares grantedpursuant to the Dimension Data Share Option Schemes

“Dimension Data ShareAppreciation RightsScheme”

: The share appreciation rights scheme for the granting of ShareAppreciation Rights to employees and executive directors ofDimension Data and its subsidiaries, approved and adopted atan extraordinary general meeting of Dimension Data held on13 November 2004

“Dimension Data ShareOption Scheme 1995”

: The share option scheme for the granting of Dimension DataShare Options to the employees and executive directors ofDimension Data and its subsidiaries, approved and adopted atan extraordinary general meeting of Dimension Data held on28 September 1995

“Dimension Data ShareOption Scheme 2000”

The share option scheme for the granting of Dimension DataShare Options to the employees and executive directors ofDimension Data and its subsidiaries, approved and adopted atan extraordinary general meeting of Dimension Data held on 7July 2000

“Dimension Data ShareOption Schemes”

: The Dimension Data Share Option Scheme 1995 and theDimension Data Share Option Scheme 2000

“Dimension Data Shares” : The issued ordinary shares in the capital of Dimension Data

“Effective Date” : The date on which the Scheme and the Capital DistributionResolution, if approved, become effective and binding inaccordance with the Scheme and the Companies Act

“EGM” or “ExtraordinaryGeneral Meeting”

: The extraordinary general meeting of the Company to be heldat Conrad Centennial Singapore, 2 Temasek Boulevard,Singapore 038982 on 15 October 2008 at 2.30 p.m. to seekthe approval of the Shareholders for the Capital Distribution,notice of which is set out in pages 239 to 240 of this Document

“Entitled SchemeShareholders”

: Scheme Shareholders as at 5.00 p.m. (Singapore time) on theBooks Closure Date

“EPS” : Earnings per share

“Excluded Directors” : The Datacraft Directors who are not considered asindependent for the purposes of providing a recommendationon the Scheme and the Capital Distribution, namely PatrickKeith Quarmby, William Bruce Grahame Padfield, JeremyJohn Ord, Josua Malherbe, Brett William Dawson (AlternateDirector to Jeremy John Ord), Stephen Michael Joubert(Alternate Director to Josua Malherbe) and Lal Chandra Singh

DEFINITIONS

5

“Excluded Shareholders” : Dimension Data, its related corporations and their respectivenominees

“Final Option Exercise Date” : The date which is 10 Market Days prior to the Books ClosureDate

“FY” : Financial year ended or ending 30 September

“Group” or the “DatacraftGroup”

: The Company, its subsidiaries and its Controlled AssociatedCompanies, and “Datacraft Group Company” means anyone of them

“IFA” or “PwCCF” : PricewaterhouseCoopers Corporate Finance Pte Ltd, theindependent financial adviser to the Independent Directors inrelation to the Scheme

“ImplementationAgreement”

: The agreement dated 22 July 2008 entered into between theCompany and Dimension Data to implement the Scheme andthe Capital Distribution

“Independent Directors” : The Datacraft Directors who are considered as independentfor the purposes of making a recommendation on the Schemeand the Capital Distribution, namely Frank Yung-Cheng Yung,Chew Kia Ngee and Ronald John Cattell

“In-the-Money VestedOptionholders”

: Holders of In-the-Money Vested Options

“In-the-Money VestedOptions”

: Options which have vested and are exercisable at an exerciseprice which is less than the Cash Consideration payable underthe Scheme

“Latest Practicable Date” : 15 September 2008, being the latest practicable date prior tothe printing of this Document

“Listing Manual” : The listing manual of SGX-ST, as amended, modified orsupplemented from time to time

“Long-Stop Date” : 31 January 2009, or as otherwise agreed between theCompany and Dimension Data

“LSE” : London Stock Exchange

“Market Day” : A day on which the SGX-ST is open for trading in securities

“NTA” : Net tangible assets

“Optionholders” : Holders of Options

“Options” or “DatacraftOptions”

: Options to subscribe for new Shares granted pursuant to theDatacraft Share Option Schemes

“Out-of-the-Money VestedOptionholders”

: Holders of Out-of-the-Money Vested Options

“Out-of-the-Money VestedOptions”

: Options which have vested and are exercisable at an exerciseprice which is equal to or more than the Cash Considerationpayable under the Scheme

DEFINITIONS

6

“Prescribed Occurrence” : The events set out in Appendix 11 to this Document

“Q3” : The nine months ended or ending 30 June

“Record Date” : The date falling on the Business Day immediately precedingthe Effective Date

“Scheme” : The scheme of arrangement dated 22 September 2008 as setout on pages 228 to 235 of this Document (or as amendedfrom time to time in accordance with Clause 12 of the Scheme)proposed in accordance with Section 210 of the CompaniesAct and the Code

“Scheme Court Order” : The order of Court sanctioning the Scheme under Section 210of the Companies Act

“Scheme Price” : The amount of US$1.09 to be paid by Dimension Data toScheme Shareholders for each Scheme Share transferred toDimension Data under the Scheme

“Scheme Shareholders” : All Shareholders other than the Excluded Shareholders

“Scheme Shares” : All of the issued Shares, other than Shares held by theExcluded Shareholders

“Securities Account” : A securities account maintained by a Depositor with CDP butdoes not include a securities sub-account

“SGX-ST” : The Singapore Exchange Securities Trading Limited

“Share Appreciation Rights” : In respect of the Dimension Data Share Appreciation RightsScheme, the right to receive a number of Dimension DataShares equal to the increase in value of any number ofDimension Data Shares, as specified in a grant certificatebetween the date of grant and the date of exercise of the right

“Shareholders” : Persons who are registered as holders of Shares (excludingtreasury shares) in the Register of Members of the Companyor who, being Depositors, have Shares entered against theirnames in the Depository Register, including persons entitledby transmission

“Share Registrar” : Tricor Barbinder Share Registration Services (a division ofTricor Singapore Pte. Ltd.)

“Shares” or “DatacraftShares”

: The issued ordinary shares in the capital of the Company

“SIC” : Securities Industry Council of Singapore

“Substantial Shareholder” : A person who has an interest in voting Shares of the Companyand the total votes attached to that Share, or those Shares, arenot less than five per cent. (5%) of the total votes attached toall voting Shares in the Company

“Unvested Optionholders” : Holders of Unvested Options

DEFINITIONS

7

“Unvested Options” : Options which are not yet vested and are exercisable atexercise prices which are less than, equal to and/or more thanthe Cash Consideration payable under the Scheme

“per cent.” or “%” : Per centum

“£” or “Pounds Sterling” : Pounds Sterling, being the lawful currency of the UnitedKingdom

“S$” and “cents” : Singapore dollars and cents respectively, being the lawfulcurrency of Singapore

“US$” and “US cents” : United States dollars and cents respectively, being the lawfulcurrency of the United States of America

“ZAR” : South African Rand, being the lawful currency of South Africa

The terms “Depositor”, “Depository Agent” and “Depository Register” shall have the meaningsascribed to them respectively in Section 130A of the Companies Act.

The terms “acting in concert” or “concert parties” shall have the meaning ascribed to themrespectively in the Code.

The terms “subsidiary” and “related corporation” shall respectively have the meaning ascribed tothem by Sections 5 and 6 of the Companies Act.

The terms “associated company” and “control” shall have the meanings ascribed to themrespectively in the Listing Manual.

Words importing the singular shall, where applicable, include the plural and vice-versa and wordsimporting the masculine gender shall, where applicable, include the feminine and neuter genders andvice-versa. References to persons shall include corporations.

Any reference in this Document to any statute, enactment, the Listing Manual or the Code is a referenceto that statute, enactment, the Listing Manual or the Code as amended or re-enacted (if applicable)from time to time. Any word defined under the Companies Act, the Listing Manual or the Code, or anymodification thereof and used in this Document shall, where applicable, have the meaning assigned toit under the Companies Act, the Listing Manual or the Code or any modification thereof, as the casemay be, unless otherwise provided.

Any reference to a time of day or date in this Document shall be a reference to Singapore time and date,as the case may be, unless otherwise stated.

Any discrepancies in this Document between the sum of the figures stated and the totals thereof shownare due to rounding. Accordingly, figures shown as totals in this Document may not necessarily be anarithmetic aggregation of the figures which precede them.

DEFINITIONS

8

1. LAST DATE AND TIMES FORLODGEMENT OF PROXY FORMS

For the Court Meeting(1) (2) : 13 October 2008 at 2.00 p.m.

For the EGM(1) (2) : 13 October 2008 at 2.30 p.m.

2. SHAREHOLDERS’ MEETINGS

Date and time of the Court Meeting : 15 October 2008 at 2.00 p.m.

Date and time of the EGM : 15 October 2008 at 2.30 p.m., or as soonthereafter following the conclusion of theCourt Meeting to be held at 2.00 p.m. on thesame day and at the same place (or itsadjournment thereof)

Place of the Court Meeting and the EGM : Conrad Centennial Singapore, 2 TemasekBoulevard, Singapore 038982

3. EXPECTED DATE OF COURT HEARINGTO SANCTION THE SCHEME

: 23 October 2008

4. EXPECTED DATE OF COURT HEARINGTO SANCTION THE CAPITALDISTRIBUTION

: 6 November 2008

5. EXPECTED FINAL OPTION EXERCISEDATE

: 16 October 2008

6. EXPECTED LAST DATE FOR TRADINGOF THE SHARES

: 24 October 2008

7. EXPECTED BOOKS CLOSURE DATE : 31 October 2008

8. EXPECTED RECORD DATE : 6 November 2008

9. EXPECTED EFFECTIVE DATE : 7 November 2008

10. EXPECTED DATE OF DELISTING OFTHE SHARES

: 7 November 2008

11. EXPECTED DATE FOR PAYMENT OFCASH CONSIDERATION

: On or before 11 November 2008

You should note that other than for the last date and times for the lodgement of ProxyForms and the date and times of the Court Meeting and the EGM, the above timetable isindicative only and may be subject to change. For the events listed above which aredescribed as “expected”, please refer to future announcement(s) by the Company and/orthe SGX-ST for the exact dates and times of these events.

Notes:

(1) Scheme Shareholders are requested to lodge the Proxy Forms for both the Court Meeting and the EGM not less thanforty-eight (48) hours before the time appointed for the Court Meeting and the EGM respectively. If Proxy Forms for the CourtMeeting are not so lodged, they may be handed to the Chairman of the Court Meeting at the Court Meeting.

(2) All Proxy Forms for the Court Meeting (if lodged before the Court Meeting) and the EGM must be lodged with the CompanySecretary at the registered office of the Company at 6 Temasek Boulevard, #26-01/05 Suntec Tower Four, Singapore038986. Completion and return of a Proxy Form for the Court Meeting and/or the EGM will not preclude a SchemeShareholder from attending and voting in person at the Court Meeting and/or the EGM if they subsequently wish to do so.In such event, the relevant Proxy Form will be deemed to be revoked.

EXPECTED TIMETABLE

9

DIRECTORS : Patrick Keith Quarmby (Non-Executive Chairman)William Bruce Grahame Padfield (Executive Director and CEO)Frank Yung-Cheng Yung (Independent Director)Chew Kia Ngee (Independent Director)Ronald John Cattell (Independent Director)Lal Chandra Singh (Non-Executive Director)Jeremy John Ord (Non-Executive Director)Josua Malherbe (Non-Executive Director)Brett William Dawson (Alternate Director to Jeremy John Ord)Stephen Michael Joubert (Alternate Director to Josua Malherbe)

COMPANYSECRETARIES

: Sandy Foo Fei YingChew Puay Hoon

REGISTERED OFFICE : 6 Temasek Boulevard#26-01/05 Suntec Tower FourSingapore 038986

SHARE REGISTRAR ANDTRANSFER OFFICE

: Tricor Barbinder Share Registration Services(a division of Tricor Singapore Pte. Ltd.)8 Cross Street #11-00PWC BuildingSingapore 048424

AUDITORS TO THECOMPANY

: Deloitte & Touche LLP6 Shenton Way #32-00DBS Building Tower TwoSingapore 068809

Partner-in-charge: Rankin Brandt YeoDate of appointment: 29 January 2008

INDEPENDENTFINANCIAL ADVISERTO THE INDEPENDENTDIRECTORS INRELATION TO THESCHEME

: PricewaterhouseCoopers Corporate Finance Pte Ltd8 Cross Street#17-00 PWC BuildingSingapore 048424

SOLICITORS TO THECOMPANY INRELATION TO THESCHEME AND THECAPITAL DISTRIBUTION

: Stamford Law Corporation9 Raffles Place#32-00 Republic PlazaSingapore 048619

CORPORATE INFORMATION

10



Directors: Registered Office:

Patrick Keith Quarmby (Non-Executive Chairman)William Bruce Grahame Padfield (Executive Director and CEO)Frank Yung-Cheng Yung (Independent Director)Chew Kia Ngee (Independent Director)Ronald John Cattell (Independent Director)Lal Chandra Singh (Non-Executive Director)Jeremy John Ord (Non-Executive Director)Josua Malherbe (Non-Executive Director)Brett William Dawson (Alternate Director to Jeremy John Ord)Stephen Michael Joubert (Alternate Director to Josua Malherbe)

6 Temasek Boulevard#26-01/05Suntec Tower FourSingapore 038986

22 September 2008

To: The Shareholders of Datacraft Asia Ltd

Dear Sir/Madam,

(1) THE PROPOSED SCHEME OF ARRANGEMENT TO PRIVATISE DATACRAFT ASIA LTDUNDER SECTION 210 OF THE COMPANIES ACT, CHAPTER 50 OF SINGAPORE; AND

(2) THE PROPOSED CAPITAL DISTRIBUTION

1. INTRODUCTION

1.1 Announcement

On 22 July 2008, the Company and Dimension Data jointly announced that the Company andDimension Data had entered into the Implementation Agreement to implement the Scheme andthe Capital Distribution.

Under the Scheme, Dimension Data proposes to acquire all the Scheme Shares by way of theScheme. The Capital Distribution (which is an integral part of the Scheme) is proposed to beeffected by way of the Capital Reduction.

1.2 Purpose

In connection with the foregoing, the Company is convening:

(a) the Court Meeting at Conrad Centennial Singapore, 2 Temasek Boulevard, Singapore038982 on 15 October 2008 at 2.00 p.m. to seek Scheme Shareholders’ approval of theScheme; and

(b) the EGM at Conrad Centennial Singapore, 2 Temasek Boulevard, Singapore 038982 on 15October 2008 at 2.30 p.m. or as soon thereafter upon conclusion of the Court Meeting (orany adjournment of the Court Meeting) to seek Shareholders’ approval of the CapitalDistribution Resolution.

LETTER FROM THE BOARD TO THE SHAREHOLDERS

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The purpose of this Document is to provide Shareholders with information on the Scheme, theCapital Reduction and the Capital Distribution, as well as to give Shareholders notice of both theCourt Meeting and the EGM.

2. BACKGROUND ON THE COMPANY AND DIMENSION DATA

2.1 Company

The Company was incorporated in Singapore on 29 March 1993 and was listed on theMainboard of the SGX-ST in 1995. The Company is an independent IT services and solutionsprovider in Asia-Pacific. As a pioneer in systems and network integration, the Company hasdesigned, implemented and managed network infrastructure for many global corporations andleading service providers, as well as the equivalent of the “Fortune 200 companies” in everycountry throughout Asia-Pacific. Dimension Data presently holds in aggregate approximately55.10 per cent. of the Company. The Company is headquartered in Singapore and has morethan 50 major offices and over 1,450 employees across 13 Asia-Pacific markets.

2.2 Dimension Data

Dimension Data was founded in 1983 and in 2007 had revenues of $3.8 billion. It is a specialistIT services and solutions provider that helps its 6,000 clients plan, build, support and managetheir IT infrastructures. By continually building on its knowledge and expertise in IT infrastructuretechnologies, Dimension Data has become a recognised global leader in the provision andmanagement of specialist IT infrastructure solutions. Drawing on its experience in networkintegration, security, converged communications, data centres and storage, contact centre andMicrosoft technologies, Dimension Data delivers a full lifecycle of IT services. Today, theDimension Data Group is positioned at the forefront of networking and communications in nearly40 countries around the world and employs in excess of 10,600 highly skilled employees.Dimension Data is a recognised industry leader with 80 industry awards in 2007 and has aprimary listing on the LSE and is also listed on the Johannesburg Securities Exchange Limited.

3. THE SCHEME

3.1 Scheme

The Scheme is proposed to all Scheme Shareholders. As at the Latest Practicable Date, theCompany has an issued share capital of US$134,313,000 comprising 461,981,427 Shares(excluding 23,230,000 treasury shares). As at the Latest Practicable Date, Dimension Dataholds in aggregate, directly and indirectly, 254,551,619 Shares, representing approximately55.10 per cent. of the Shares in issue (excluding treasury shares).

The Scheme will involve, inter alia, the following:

(a) a transfer of all Scheme Shares held by Scheme Shareholders to Dimension Data and/orits nominees; and

(b) in consideration of the transfer of their Scheme Shares, the Scheme Shareholders willreceive an aggregate of US$1.33 in cash for each Scheme Share transferred (the “CashConsideration”), comprising:

(i) US$1.09 in cash from Dimension Data for each Scheme Share transferred (the“Scheme Price”); and


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(ii) US$0.24 in cash from the Company for each Scheme Share held as at the BooksClosure Date pursuant to the Capital Distribution.

For the avoidance of doubt, the Excluded Shareholders, being Dimension Data, its relatedcorporations and their respective nominees, will not be entitled to the Scheme Price and/or theCapital Distribution.

The Scheme will also be extended to all Shares validly issued pursuant to the exercise ofOptions granted under the Datacraft Share Option Schemes on or before the Final OptionExercise Date.

Pursuant to the Scheme, the Scheme Shares will be transferred fully paid, free from all liens,equities, charges, encumbrances, rights of pre-emption and any other third party rights orinterests or any nature whatsoever and together with all rights attached thereto as at theAnnouncement Date, including the right to receive and retain all dividends, rights, and, save forthe Capital Distribution, other distributions (if any) declared, paid or made by the Company onor after the Announcement Date.

3.2 Rationale for the Scheme

The rationale for implementing the Scheme is as follows:

(a) Strengthen the Company’s position in the market

Dimension Data has held a majority stake in the Company since 1997, during which timethere has been an increasing alignment of the strategic and operating models of bothcompanies. Dimension Data continues to pursue its strategy of driving profitable growthfrom its global presence and believes that it would gain increased exposure to attractivegrowth markets through full ownership of one of the leading information technologyservices and solutions providers in Asia-Pacific.

Dimension Data believes that the Company’s leadership position in Asian markets will bestrengthened by bringing it fully within the Dimension Data Group, offering it the opportunityto leverage more effectively the resources of the wider group and capitalise onopportunities in the market. Dimension Data believes that, if privatised, the Company’smanagement will be able to react faster with greater flexibility to available opportunitiesinternationally and accelerate its growth in key markets.

(b) Reduced costs and improved efficiency

As a listed entity, the Company has to incur listing, compliance and other related costsassociated with continuing listing requirements under the Listing Manual. If privatised,efficiencies would result from greater sharing of services and resources with DimensionData’s other strategic business units. In particular, Dimension Data and the Companywould be better able to freely transfer intellectual property, share best practices and ensureunfettered staff mobility within the enlarged group. Similarly, Dimension Data and theCompany will be able to fully align their businesses to increase operational efficiencies.Management of group-wide cashflows and capital structure would also be significantlyimproved.

(c) Public listing no longer beneficial

The Company’s public listing no longer serves a material purpose as the Company has notraised any funds from the capital markets since the year 2000 and there is no foreseeablerequirement to do so. Further, since being excluded from the MSCI Singapore Index in


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mid-2006, the Company has experienced a reduced level in the trading of the Shares, withaverage daily traded volume over the last 12 months down approximately 92 per cent. onthe average daily traded volume in the three years prior to June 2006. The low tradingliquidity of the Shares limits the purpose of its public listing and reduces the effectivenessof its employee incentive schemes.

(d) Attractive premium to share price

The Scheme provides an opportunity for Scheme Shareholders to realise their investmentin the Company for cash at an attractive premium to recent market prices. The aggregateCash Consideration (including the Capital Distribution) represents a 33.0 per cent.premium over the volume weighted average of transacted prices of the Shares on theSGX-ST of US$1.00 over the last three months prior to the Announcement Date.

3.3 Future Plans for the Company

Dimension Data has been integrally involved with the Company for 11 years and, in the event theScheme becomes effective, anticipates minimal changes to the operations of the Company.Dimension Data intends to continue the Company’s services and solutions portfolio and maintainits go-to-market strategy, which are already closely aligned to that of Dimension Data. It alsointends to retain the Datacraft name due to the considerable brand equity and recognition builtup over the years to avoid significant costs in building a new brand across 13 different countries.Dimension Data believes that the Company has a strong and experienced management teamand committed employees who are key and valued members of the Dimension Data Group andtherefore also does not anticipate any change in the management and reporting structure orenvision any retrenchments. Save as disclosed above, Dimension Data has no near-term plans,in the event that the Scheme becomes effective, to (a) introduce any major changes to thebusinesses of the Group, (b) make any major disposal or redeployment of assets (including thefixed assets of the Group) or (c) discontinue the employment of the employees of the Group.

3.4 Options Proposal

(a) Terms

The Scheme will not be extended to Optionholders. Pursuant to the terms of theImplementation Agreement, Dimension Data has agreed to make an appropriate proposal(the “Options Proposal”) to Optionholders in connection with the Scheme that will (a)preserve the position of Optionholders, (b) continue to sufficiently motivate them tocontinue to contribute to the Group and (c) be on terms that are fair and reasonablecompensation for the holders of Options, as determined by the auditors of the Company(acting as experts and not arbitrators) under the Datacraft Share Option Schemes.

The terms of the Options Proposal are as follows:

(i) In-the-Money Vested Options. In respect of the In-the-Money Vested Options,subject to:

(A) the Scheme becoming effective and binding; and

(B) such In-the-Money Vested Options continuing to be exercisable into new Sharesas at the Effective Date,

Dimension Data will pay In-the-Money Vested Optionholders a cash amountcalculated based upon the “see-through” price, being the excess of the Cash


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Consideration payable under the Scheme for each Scheme Share over the exerciseprice of the respective In-the-Money Vested Options, in consideration for suchIn-the-Money Vested Optionholders agreeing:

(1) not to exercise all or any of such In-the-Money Vested Options into new Shares;and

(2) not to exercise all or any of their other rights as Optionholders,

in each case from the date of their acceptance of the Options Proposal to therespective dates of expiry of such In-the-Money Vested Options. In addition, in theevent that the Scheme becomes effective, In-the-Money Vested Optionholders whohave accepted the Options Proposal will also be required to surrender all of theirIn-the-Money Vested Options for cancellation.

(ii) Out-of-the-Money Vested Options. In respect of the Out-of-the-Money VestedOptions, subject to:

(A) the Scheme becoming effective and binding;

(B) such Out-of-the-Money Vested Options continuing to be exercisable into newShares as at the Effective Date; and

(C) the auditors of the Company (acting only as experts and not as arbitrators)confirming in writing that the following arrangements are fair and reasonable,

Dimension Data will procure that, instead of receiving new Shares issued by theCompany on any exercise of such Out-of-the-Money Vested Options after theEffective Date, Out-of-the-Money Vested Optionholders will receive such number ofDimension Data Shares based upon the Cash Consideration payable under theScheme for each Scheme Share and the volume weighted average price of aDimension Data Share on the LSE on the Effective Date, such number of DimensionData Shares being determined as follows:

A =(B x C)

(D x Exchange Rate)

Where:

A : Number of Dimension Data Shares to be received on exerciseof Out-of-the-Money Vested Options;

B : Number of new Shares originally to be issued by the Companyon exercise of Out-of-the-Money Vested Options;

C : US$1.33, being the Cash Consideration payable under theScheme for each Scheme Share;

D : An amount in £ equivalent to the volume weighted average priceof a Dimension Data Share on the LSE on the Effective Date;and


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Exchange Rate : The rate of exchange between US$ and £ as shown onBloomberg “GBP Currency QR” at 5.00 p.m. (Singapore time)on the Effective Date, provided that if Bloomberg ceases todisplay such information, such page as displays suchinformation on such other services as may be selected byDimension Data,

in consideration of such Out-of-the-Money Vested Optionholders agreeing:

(1) not to exercise all or any such Out-of-the-Money Vested Options into newShares; and

(2) not to exercise all or any of their rights as holders of such Out-of-the-MoneyVested Options,

in each case from the date of their acceptance of the Options Proposal up to andincluding the Effective Date. In the event the Scheme becomes effective and theauditors of Datacraft confirm in writing that the above arrangements are fair andreasonable, the Out-of-the-Money Vested Options will not lapse and will continue untilthe expiry of their relevant option period(s). The Company will deliver, and/orDimension Data will procure that the Company delivers, Dimension Data Sharespursuant to any exercise of Out-of-the-Money Vested Options after the Effective Datein the form of existing Dimension Data Shares purchased from the market. Fractionsof a Dimension Data Share will not be delivered and will be disregarded.

For the avoidance of doubt, other than the substitution of an equivalent value ofDimension Data Shares for the new Shares to be issued on exercise of theOut-of-the-Money Vested Options by Out-of-the-Money Vested Optionholders, allother terms of such Options, including, inter alia, the exercise price, will remain thesame.

(iii) Unvested Options. In respect of the Unvested Options, subject to:

(A) the Scheme becoming effective and binding;

(B) such Unvested Options continuing to be exercisable into new Shares as at theEffective Date (and where performance conditions are attached to the vesting ofsuch Unvested Options, such performance conditions having been satisfied bythe relevant Optionholder or waived by the Committee); and

(C) the auditors of the Company (acting only as experts and not as arbitrators)confirming in writing that the following arrangements are fair and reasonable,

Dimension Data will procure that, instead of receiving new Shares issued by theCompany on any exercise of such Unvested Options after the Effective Date,Unvested Optionholders will receive such number of Dimension Data Shares basedupon the Cash Consideration payable under the Scheme for each Scheme Share andthe volume weighted average price of a Dimension Data Share on the LSE on theEffective Date, such number of Dimension Data Shares being determined as follows:

E =(F x G)

(H x Exchange Rate)


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Where:

E : Number of Dimension Data Shares to be received on exerciseof Unvested Options;

F : Number of new Shares originally to be issued by the Companyon exercise of Unvested Options;

G : US$1.33, being the Cash Consideration payable under theScheme for each Scheme Share;

H : An amount in £ equivalent to the volume weighted average priceof a Dimension Data Share on the LSE on the Effective Date;and

Exchange Rate : The rate of exchange between US$ and £ as shown onBloomberg “GBP Currency QR” at 5.00 p.m. (Singapore time)on the Effective Date, provided that if Bloomberg ceases todisplay such information, such page as displays suchinformation on such other services as may be selected byDimension Data,

in consideration of such Unvested Optionholders agreeing:

(1) not to exercise all or any such Unvested Options into new Shares; and

(2) not to exercise all or any of their rights as holders of such Unvested Options,

in each case from the date of their acceptance of the Options Proposal up to andincluding the Effective Date. In the event the Scheme becomes effective and theauditors of the Company confirm in writing that the above arrangements are fair andreasonable, the Unvested Options will not lapse and will continue until the expiry oftheir relevant option period(s). The Company will deliver, and/or Dimension Data willprocure that the Company delivers, Dimension Data Shares pursuant to any exerciseof Unvested Options after the Effective Date in the form of existing Dimension DataShares purchased from the market. Fractions of a Dimension Data Share will not bedelivered and will be disregarded.

For the avoidance of doubt, other than the substitution of an equivalent value ofDimension Data Shares for the new Shares to be issued on exercise of the UnvestedOptions by Unvested Optionholders, all other terms of such Options, including, interalia, the exercise price, the vesting periods and any performance conditions to besatisfied by the Unvested Optionholder prior to vesting, will remain the same.

(b) Datacraft Share Option Schemes

Under Rule 7(b) of the Datacraft Share Option Schemes, if the Court sanctions theScheme, Optionholders (including Optionholders holding Options which are then notexercisable pursuant to the provisions of the Datacraft Share Option Schemes) shall beentitled to exercise any Options then held by them during the Accelerated Exercise Period.On the expiry of the Accelerated Exercise Period, any unexercised Options shall lapse andbecome null and void.

However, under Rule 7(e) of the Datacraft Share Option Schemes, if arrangements aremade (which are confirmed in writing by the auditors of the Company, acting only asexperts and not as arbitrators, to be fair and reasonable) for the compensation ofOptionholders, whether by continuation of their Options, or the payment of cash or the


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grant of other options or otherwise, an Optionholder holding an Option, which wouldotherwise be exercisable, may not, at the discretion of the Committee be permitted toexercise that Option during the Accelerated Exercise Period.

It should be noted that the last date for trading of the Shares is expected to be 24 October2008. Accordingly, all Optionholders who validly exercise their Options and are issuedShares pursuant to such valid exercise before or on the Final Option Exercise Date will beentitled to participate in the Scheme. If an Optionholder purports to exercise his or herOptions after the Final Option Exercise Date, there will be insufficient time for the Companyto issue Shares to the Optionholder and notwithstanding the rules of the Datacraft ShareOption Schemes as mentioned above, such Optionholders will not have effectivelyexercised their Options prior to the Books Closure Date and will not be able to participatein the Scheme.

(c) Amendment to the Datacraft Share Option Schemes

Rule 7(e) of each of the Datacraft Share Option Schemes provides, inter alia, that ifarrangements are made (which are confirmed in writing by the auditors of the Company,acting only as experts and not as arbitrators, to be fair and reasonable) for thecompensation of Optionholders, whether by continuation of their Options, or the paymentof cash or the grant of other Options or otherwise (emphasis added), an Optionholderholding an Option, which is not then exercisable, may not at the discretion of theCommittee be permitted to exercise that Option during the Accelerated Exercise Period.

As Rule 7(e) includes the words “or otherwise” (as emphasised above), provided that theauditors of the Company confirm in writing that any arrangements made are fair andreasonable, the arrangements proposed under the Options Proposal in respect of theOut-of-the-Money Vested Options and the Unvested Options are in line with the rules ofeach of the Datacraft Share Option Schemes (“Rules”).

Rule 7(e) currently only refers to “options which are not then exercisable” and is silent onOptions which have already vested and are exercisable. Consequently, Rule 7(e) ascurrently provided for, does not apply to arrangements such as the Options Proposal inrespect of the Options which have already vested and are exercisable.

Pursuant to the Rules, the Committee shall have the power, from time to time, to make andvary such regulations (not being inconsistent with the Scheme) for the implementation andadministration of the Datacraft Share Option Schemes as it thinks fit. Also, save for, interalia, modifications or alterations (a) which adversely alter the rights attaching to anyOptions granted prior to such modification or alteration and (b) to certain definitions in theRules (including, but not limited to, “Committee”, “Option Period” and “Participant”) andcertain provisions of the Rules (including, but not limited to, Rule 3 “Eligibility ofParticipants”, Rule 4 “Grant of Options” and Rule 6 “Rights to Exercise Options”), any or allof the provisions of the Datacraft Share Option Schemes may be modified and/or alteredat any time and from time to time by resolution of the Committee.

As, in the event the Scheme becomes effective, Dimension Data (i) does not intend toimplement any changes to the terms and conditions of the employment of Datacraftemployees in the near term, including the operation of the Datacraft Share OptionSchemes, (ii) intends for the Options to continue after the Scheme becomes effective and(iii) has agreed in the Implementation Agreement for the Options Proposal to, inter alia,preserve the position of the Optionholders, the Committee has determined that to facilitatethe making and implementation of the Options Proposal in respect of the Out-of-the-Money


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Vested Options, Rule 7(e) be amended to include Options which have already vested andare exercisable within its scope, as follows:

“If in connection with....the scheme referred to in paragraph (b)above....arrangements are made (which are confirmed in writing by the auditorsof the Company, acting only as experts and not as arbitrators, to be fair andreasonable) for the compensation of Participants, whether by continuation oftheir options, or the payment of cash or the grant of other options or otherwise,a Participant holding an option, which is not then exercisable whether or notsuch option is then exercisable, may not, at the discretion of the Committeebe permitted to exercise that option as provided for in this Rule 7.”

The proposed amendment, subject to the auditors of the Company (acting only as expertsand not as arbitrators) confirming in writing that the arrangements proposed under theOptions Proposal are fair and reasonable, would restrict the ability of Out-of-the-MoneyVested Optionholders and/or In-the-Money Vested Optionholders to exercise their Optionsduring the Accelerated Exercise Period and participate in the Scheme. Shareholders arenot so restricted, will be able to participate in the Scheme and will be provided with an exitfrom the Company in cash in the event the Scheme becomes effective.

Other than the arrangements being confirmed by the auditors of the Company in writing asfair and reasonable, the proposed amendment to Rule 7(e) is also subject to the Schemebecoming effective and binding, and will therefore only take effect in the event that theScheme is approved by the requisite majority at the Court Meeting, is sanctioned by theCourt and the Scheme Court Order is lodged with ACRA.

The proposed amendment to Rule 7(e) does not result in a benefit that Shareholders do notreceive.

(d) Auditors’ Confirmation

The auditors of the Company have, on 10 September 2008, confirmed that the abovearrangements in the Options Proposal in relation to the Out-of-the-Money Vested Optionsand the Unvested Options are fair and reasonable.

(e) SGX-ST

Rule 14(a)(iii) of the Datacraft Share Option Schemes provides, inter alia, that nomodification or alteration shall be made without the prior approval of the SGX-ST. TheSGX-ST has granted its in-principle approval for the proposed modification of Rule 7(e) ofthe Datacraft Share Option Schemes, subject to the Scheme becoming effective andbinding.

(f) Further Details

Please refer to paragraph 4 and Annex 1 of Dimension Data’s Letter to Shareholders inAppendix 2 to this Document for further details on the Options Proposal. A separate letterfrom Dimension Data and the Company to each Optionholder setting out the terms andconditions of the Options Proposal and explaining the impact of the Scheme on theOptions, has been or will be, at the same time as this Document, despatched to theOptionholders.


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3.5 Awards Granted under the Datacraft Share Plan

(a) Awards

As at the Latest Practicable Date, there are outstanding conditional awards (“Awards” or“Share Awards”) granted under the Datacraft Share Plan to members of management (the“Grantees”) of the Company to receive 1,098,000 Datacraft Shares. The Datacraft Shareswhich are the subject of such Awards will only be released to Grantees after a vestingperiod if certain pre-determined performance targets as determined by the committeeadministering the Datacraft Share Plan are achieved by the relevant Grantee or otherwisein accordance with the Datacraft Share Plan. The Awards will be released from 28 March2011 if the performance conditions attached to such Awards are satisfied.

(b) Arrangements in relation to Awards

In the case of such Awards, it is proposed in the event that the relevant performanceconditions are satisfied and the Awards vest after the Effective Date, instead of receivingShares, Dimension Data will procure that the Grantees receive such number of DimensionData Shares based upon the Cash Consideration payable under the Scheme for eachScheme Share and the volume weighted average price of a Dimension Data Share on theLSE on the Effective Date, such number of Dimension Data Shares being determined asfollows:

J =(K x L)

(M x Exchange Rate)

Where:

J : Number of Dimension Data Shares to be received on vesting anddelivery of Awards;

K : Number of Shares originally to be received on vesting and deliveryof Awards;

L : US$1.33, being the Cash Consideration payable under the Schemefor each Scheme Share;

M : An amount in £ equivalent to the volume weighted average price ofa Dimension Data Share on the LSE on the Effective Date; and

Exchange Rate : The rate of exchange between US$ and £ as shown on Bloomberg“GBP Currency QR” at 5.00 p.m. (Singapore time) on the EffectiveDate, provided that if Bloomberg ceases to display such information,such page as displays such information on such other services asmay be selected by Dimension Data.

The Company will deliver, and/or Dimension Data will procure that the Company delivers,Dimension Data Shares pursuant to any vesting and delivery of Awards after the EffectiveDate in the form of existing Dimension Data Shares purchased from the market. Fractionsof a Dimension Data Share will not be delivered and will be disregarded.

For the avoidance of doubt, other than the substitution of an equivalent value of DimensionData Shares for Shares to be delivered on the vesting and delivery of Awards, all otherterms of the Awards, including the vesting periods and any performance conditions to besatisfied by the Grantee(s) prior to vesting, will remain the same.


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3.6 No Cash Outlay

Scheme Shareholders should note that no cash outlay (including any stamp duties or brokerageexpenses) will be required from Scheme Shareholders under the Scheme.

3.7 Waiver of Rights to a General Offer

Scheme Shareholders should also note that by voting in favour of the Scheme, SchemeShareholders will be regarded as having waived their rights to a general offer by Dimension Dataand/or parties acting or deemed to be acting in concert with Dimension Data to acquire theScheme Shares under the Code.

3.8 Delisting

If the Scheme becomes effective, Dimension Data will own the entire issued share capital of theCompany.

An application has been made to seek confirmation from the SGX-ST to withdraw the Sharesfrom the Official List of the SGX-ST upon the Scheme becoming effective and binding. TheSGX-ST has advised, inter alia, that subject to the Scheme being approved by the SchemeShareholders and the Court, it has no objection to the proposed withdrawal of the Shares fromthe Official List of the SGX-ST.

The confirmation from the SGX-ST, however, is not an indication of the merits of the Company,its subsidiaries, the Scheme or the proposed withdrawal of the Shares from the Official List ofthe SGX-ST.

3.9 Explanatory Statement

An Explanatory Statement setting out the key terms of, the rationale for and the effect of theScheme and the procedures for its implementation is set out on pages 32 to 42 of this Document.It should be read with the full text of this Document, including the Scheme as set out on pages228 to 235 of this Document.

3.10 Letter from Dimension Data to the Scheme Shareholders

The views and intentions of Dimension Data in relation to the Company and the Scheme are setout in their letter to the Scheme Shareholders on pages 68 to 128 of this Document.

4. CAPITAL DISTRIBUTION

4.1 Capital Distribution

The Capital Distribution (which is an integral part of the Scheme), is proposed to be effected byway of the Capital Reduction, and will consist of a return to Scheme Shareholders of US$0.24in cash from the Company for each issued Scheme Share held as at the Books Closure Date,the aggregate amount of which is up to US$52,600,000 in cash. As at 30 June 2008, the issuedshare capital of the Company was US$134,217,000, comprising 461,890,427 Shares (excluding23,321,000 treasury shares) in issue and there were 33,132,000 Options outstanding.


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The Capital Reduction will be effected in the following manner:

(a) the issued share capital of the Company will be reduced from approximatelyUS$134,217,000 to approximately US$81,617,000 or such higher amount remaining aftercancelling the amount required to effect the Capital Distribution;

(b) the Company will make a cash distribution of US$0.24 for each Scheme Share held by oron behalf of the Scheme Shareholders from the credit of up to US$52,600,000 arising outof the Capital Reduction; and

(c) no Shares will be cancelled pursuant to the Capital Reduction.

The Capital Distribution will also be extended to all Shares validly issued pursuant to theexercise of Options on or before the Final Option Exercise Date.

For the avoidance of doubt, the Excluded Shareholders, being Dimension Data, its relatedcorporations and their respective nominees, will not be entitled to the Capital Distribution.

4.2 Rationale for the Capital Distribution

The Capital Distribution forms an integral part of the Scheme and is inter-conditional with theScheme being effective. The Directors are of the view that there is no difference betweenDimension Data using its own funds to acquire the Scheme Shares and having the Companyfund part of the acquisition, since in the event that the Scheme becomes effective, DimensionData will own the entire issued share capital of the Company and will effectively have ownershipof any cash held in the Company’s cash balances. As the Capital Distribution is intended to formpart of the consideration for Dimension Data’s acquisition of the Scheme Shares, the ExcludedShareholders will not be entitled to the Capital Distribution.

The Directors consider that the Company has sufficient cash resources to undertake the CapitalDistribution which will be payable to entitled Scheme Shareholders as part of the CashConsideration.

4.3 Funds for the Capital Distribution

The Capital Distribution pursuant to the Capital Reduction will be funded entirely using theCompany’s internal cash resources. The Directors are of the opinion that the Capital Distributionof up to US$52,600,000 to be returned to the Shareholders pursuant to the Capital Reduction,is in excess of the needs of the Company.

4.4 Conditions and Approvals

The Capital Distribution is conditional upon, inter alia:

(a) the passing of the Capital Distribution Resolution. The Excluded Shareholders will abstainfrom voting on the Capital Distribution Resolution;

(b) the Scheme being approved by a majority in number of the Scheme Shareholders,representing not less than three-fourths in value of the Scheme Shares held by, theScheme Shareholders, present and voting, either in person or by proxy, at the CourtMeeting;

(c) the approval and confirmation of the Court for the Capital Distribution and the lodgementof a copy of the Capital Distribution Court Order with ACRA;


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(d) the Scheme being sanctioned and approved by the Court and the lodgement of a copy ofthe Scheme Court Order with ACRA; and

(e) the approval of all other relevant regulatory authorities.

The Capital Distribution Resolution will take effect on the date of lodgement of the CapitalDistribution Court Order with ACRA. The Capital Distribution Court Order will be lodged togetherwith the Scheme Court Order, which is expected to be on or about 7 November 2008.

4.5 Financial Effects of the Capital Distribution

The financial effects set out below are theoretical in nature and strictly for illustrative purposesonly. Accordingly, they do not represent the actual financial position and/or results of the Group’soperations after the completion of the Capital Distribution and are also not indicative of the futurefinancial position and earnings of the Group.

(a) Bases and Assumptions

The illustrative financial effects set out at paragraphs 4.5(b) to 4.5(e) are based on theissued and paid-up capital of the Company as at 30 June 2008 of US$134,217,000comprising 461,890,427 Shares (excluding 23,321,000 treasury shares) and on theassumption that the Capital Distribution had taken effect on 30 June 2008. The financialeffects set out at paragraphs 4.5(b) to 4.5(e) below are prepared based on the unauditedconsolidated financial statements of the Company for Q3 2008.

The financial effects of the Capital Distribution takes into account two scenarios. Scenario1 assumes no outstanding Options are exercised. Scenario 2 assumes all outstandingIn-the-Money Vested Options are exercised.

(b) Issued Share Capital and Shareholders’ Funds

For illustrative purposes only, the financial effects of the Capital Distribution on the issuedshare capital and shareholders’ funds of the Group would have been as follows:

As at 30 June2008

Pro Forma After CapitalDistribution

Scenario 1 Scenario 2

Number of Shares(1) (’000) 461,890 461,890 461,890

Issued Share Capital(1) (US$’000) 134,217 81,617 93,252

Revenue Reserves (US$’000) 204,672 204,672 204,672

Shareholders’ Funds (US$’000) 218,687 166,087 177,722

Note:

(1) Excluding treasury shares


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(c) NTA

For illustrative purposes only, the effect of the Capital Distribution on the consolidated NTAof the Group would have been as follows:

As at 30 June2008

Pro Forma After CapitalDistribution

Scenario 1 Scenario 2

NTA (US$’000) 214,268 161,668 173,303

NTA per Share(1) (US cents) 46.39 35.00 37.52

Note:

(1) Excluding treasury shares

(d) Earnings Per Share

The Capital Distribution would have had no material impact on the EPS of the Group as theCapital Distribution assumes the conversion of the exercise of the outstanding In-the-Money Vested Options on the last day of the financial period, and that no returns areearned on the net proceeds from the exercise of the outstanding In-the-Money VestedOptions.

(e) Gearing

The Capital Distribution would have had no material impact on the gearing of the Group.

4.6 Further Information

Please refer to paragraphs 8.3 and 8.4 of the Explanatory Statement for further information onthe Books Closure Date, as well as the settlement and registration procedures, in relation to theCapital Distribution.

5. COURT MEETING

The Scheme, which is proposed pursuant to Section 210 of the Companies Act and the Code,must be approved by the Scheme Shareholders at a meeting convened at the direction of theCourt. By an order of the Court dated 9 September 2008, the Court Meeting was directed to beconvened for the purpose of approving the Scheme.

By proposing that the Scheme be effected by way of a scheme of arrangement, the Companyis providing the Scheme Shareholders with the opportunity to determine at the Court Meetingwhether they consider the Scheme to be in their best interests. When the Scheme, with orwithout modification, becomes effective, the Scheme will be binding on all the SchemeShareholders, whether or not they were present, in person or by proxy, or voted at the CourtMeeting.

The Scheme must be approved by a majority in number of the Scheme Shareholders,representing not less than three-fourths in value of the Scheme Shares held by the SchemeShareholders, present and voting, either in person or by proxy, at the Court Meeting.


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The Scheme will not be applicable to the Excluded Shareholders. Accordingly, the ExcludedShareholders will abstain from voting at the Court Meeting. The common SubstantialShareholders of Dimension Data and the Company will also abstain from voting in respect of anyShares held by them at the Court Meeting.

The notice of the Court Meeting is set out on pages 236 to 238 of this Document. SchemeShareholders are requested to take note of its date, time and place.

6. EXTRAORDINARY GENERAL MEETING

The EGM will be held at Conrad Centennial Singapore, 2 Temasek Boulevard, Singapore038982 on 15 October 2008 at 2.30 p.m. immediately after the Court Meeting for the purposesof considering and, if thought fit, passing the Capital Distribution Resolution.

The notice of the EGM is set out on pages 239 to 240 of this Document. Scheme Shareholdersare requested to take note of its date, time and place.

7. SUSPENSION AND DELISTING

Shareholders should note that subject to the agreement of the SGX-ST, the last day for tradingof the Shares is expected to be 24 October 2008. The Books Closure Date is expected to be at5.00 p.m. on 31 October 2008, and the listing of the Shares is expected to be withdrawn fromthe Official List of the SGX-ST with effect from 7 November 2008.

Shareholders should note the Shares will be delisted and withdrawn from the Official Listof the SGX-ST if the Scheme becomes effective in accordance with its terms.

8. ACTION TO BE TAKEN BY SCHEME SHAREHOLDERS

8.1 Appointment of Proxies

Scheme Shareholders who are unable to attend the Court Meeting and/or the EGM arerequested to sign and return the Proxy Forms attached to this Document in accordance with theinstructions printed thereon as soon as possible and, in any event, so as to reach the registeredoffice of the Company at 6 Temasek Boulevard, #26-01/05 Suntec Tower Four, Singapore038986, not later than forty-eight (48) hours before the time appointed for the Court Meeting andthe EGM, as relevant. If the Proxy Forms for the Court Meeting are not so lodged, they may behanded to the Chairman of the Court Meeting at the Court Meeting.

The completion and return of Proxy Forms will not prevent Scheme Shareholders from attendingand voting at the Court Meeting and/or the EGM in person if they subsequently wish to do so.In such event, the relevant Proxy Forms will be deemed to be revoked.

8.2 When Depositor Regarded as Shareholder

A Depositor shall not be regarded as a Scheme Shareholder entitled to attend and vote at theCourt Meeting and/or the EGM unless he is shown to have Shares entered against his name inthe Depository Register as at forty-eight (48) hours before the time fixed for holding the CourtMeeting and/or the EGM, as certified by CDP to the Company.


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9. ABSTENTION FROM VOTING

As required by the SIC, the Excluded Shareholders will abstain from exercising the voting rightsin respect of their Shares, if any, at the Court Meeting in respect of the Scheme. Each ExcludedShareholder will also not be accepting nominations to act as proxy, corporate representative orattorney to vote on the Scheme unless the Shareholder appointing him indicates clearly howvotes are to be cast in respect of the Scheme.

As the Capital Distribution is inter-conditional with the Scheme, the Excluded Shareholders willalso abstain from exercising the voting rights in respect of their Shares, if any, on the CapitalDistribution Resolution at the EGM. Each Excluded Shareholder will also not be acceptingnominations to act as proxy, corporate representative or attorney to vote on the CapitalDistribution Resolution unless that Shareholder appointing him indicates clearly how votes areto be cast in respect of the Capital Distribution Resolution.

Accordingly, the Excluded Shareholders will abstain from voting on the Scheme and the CapitalDistribution Resolution. The Excluded Shareholders will decline to accept appointments asproxies to vote on the Scheme and the Capital Distribution Resolution, unless the Shareholderconcerned has given specific instructions in the relevant Proxy Form as to the manner in whichhis votes are to be cast in respect of the Scheme or the Capital Distribution Resolution (as thecase may be).

10. DIRECTORS’ AND SUBSTANTIAL SHAREHOLDERS’ INTERESTS IN SHARES

The interests of the Directors and Substantial Shareholders in the Shares are set out on page134 of this Document.

11. CONFIRMATION OF FINANCIAL RESOURCES

Cazenove, as financial adviser to Dimension Data, has confirmed that sufficient financialresources are available to Dimension Data to satisfy in full the Cash Consideration to be paid tothe Scheme Shareholders pursuant to the Scheme.

12. INDEPENDENT FINANCIAL ADVISER TO THE INDEPENDENT DIRECTORS

12.1 Appointment of PwCCF

PwCCF has been appointed to advise the Independent Directors in respect of the Scheme, andin particular, on the fairness of the Cash Consideration to the Scheme Shareholders. The adviceof the IFA is set out in its letter dated 22 September 2008, which is set out in Appendix 1 to thisDocument.

12.2 IFA’s Advice

An extract of the IFA’s letter dated 22 September 2008 summarising its opinion to theIndependent Directors in relation to the Scheme and the Cash Consideration is reproducedbelow:

“The principal factors that we have taken into account in forming our opinion are summarisedbelow:

(a) the Cash Consideration represents a premium of 22.0%, 23.1%, 34.3%, 33.0%, 30.4% and34.3% over the VWAP of the Shares for the 2-year period, 1-year period, 6-month period,


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3-month period, 1-month period and on the Last Trading Day on which the Shares weretraded prior to the Announcement Date;

(b) during the last 2-year period and 1-year period prior to the Announcement Date, theaverage daily trading volumes for the Shares were 971,202 and 609,135 representingapproximately 0.5% and 0.3% of the Public Float respectively. Further, during the 6-monthperiod, 3-month period and 1-month period prior to the Announcement Date, the averagetrading volume for the Shares were 488,298, 366,097 and 140,810 representingapproximately 0.2%, 0.2% and 0.1% of the Public Float respectively. This demonstrates ageneral decline in the trading activity of the Shares in the last 2-year period prior to theAnnouncement Date;

(c) the market price of the Shares has generally underperformed against the STI for the 2-yearperiod prior to the Announcement Date. However, based on our observations set out inSection 7.1.2 of our letter, we note that the market price of Datacraft Shares has beentrending upwards since the Announcement Date leading up to the Latest Practicable Date.This appears to be mainly influenced by and supported by, inter alia, the Scheme. Thereis no assurance that the price of the Shares and/or trading liquidity of the Shares willremain at their current levels if the Scheme does not become effective;

(d) the premium implied in the Cash Consideration of 30.4% over the 1-month VWAP prior tothe Announcement Date is within the range, but is less favourable compared to the medianand average 1-month VWAP of 30.6% and 31.9% of the Comparable PrivatisationTransactions;

(e) the premium implied in the Cash Consideration of 33.0% over the 3-month VWAP prior tothe Announcement Date is within the range but is less favourable compared to the medianand average 3-month VWAP of 34.6% and 35.4% respectively of the ComparablePrivatisation Transactions;

(f) the premium implied in the Cash Consideration of 30.4% over the 1-month VWAP prior tothe Announcement Date is within the range and is more favourable compared to themedian and average 1-month VWAP of 26.8% and 29.0% respectively of the ComparablePrivatisation Transactions by Controlling Shareholder;

(g) the premium implied in the Cash Consideration of 33.0% over the 3-month VWAP prior tothe Announcement Date is within the range and is more favourable compared to themedian and average 3-month VWAP of 25.4% and 28.1% respectively of the ComparablePrivatisation Transactions by Controlling Shareholder;

(h) the EV/EBITDA ratio implied in the Cash Consideration of 10.0x is above the range of theEV/EBITDA ratios of the Comparable Companies of 3.0x to 9.3x ;

(i) the P/E and Adjusted P/E ratios implied in the Cash Consideration of 20.3x and 17.1x arewithin the range and are more favourable compared to the median and average P/E ratiosof the Comparable Companies of 9.6x and 11.8x respectively;

(j) the P/NTA ratio implied in the Cash Consideration of 2.9x is within the range and is morefavourable compared to the median and average P/NTA ratios of the ComparableCompanies of 1.7x and 2.2x respectively;

(k) the EV/EBITDA ratio implied in the Cash Consideration of 10.0x is within the range but isless favourable compared to the median and average EV/EBITDA ratios of the ComparableTransactions in the IT sector of 10.7x and 10.5x respectively;


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(l) the P/E and Adjusted P/E ratios implied in the Cash Consideration of 20.3x and 17.1x arewithin the range and are more favourable compared to the median and average P/E ratiosof the Comparable Transactions in the IT sector of 14.8x and 16.1x respectively;

(m) the P/NTA ratio implied in the Cash Consideration of 2.9x is within the range and is morefavourable compared to the median and average P/NTA ratios of the ComparableTransactions in the IT sector of 1.7x and 2.0x respectively;

(n) the premium of the Cash Consideration of 30.4% over the 1-month VWAP prior to theAnnouncement Date is within the range and is more favourable compared to the medianand average 1-month VWAP of the Comparable Transactions in the IT sector of 22.2% and20.3% respectively; and

(o) As at the Latest Practicable Date, there is no publicly available evidence of any alternativeoffer for the Shares. Further, the Directors have also confirmed that as at the LatestPracticable Date, apart from the Scheme, they have not received any other offer from anyother party.

Having carefully considered the financial analysis and subject to the assumptions andqualifications made herein, we are of the opinion that, on balance, the financial terms ofthe Scheme are fair and reasonable and are not prejudicial to the interests of the SchemeShareholders under current market conditions as at the Latest Practicable Date.

In rendering our opinion, we have not taken into consideration the specific investment objectives,financial situation, tax position or particular needs and constraints of any individual SchemeShareholder. As each Scheme Shareholder would have different objectives and profiles, werecommend that any individual Scheme Shareholder who may require specific advice in relationto his investment objectives or portfolio should consult his stockbroker, bank manager, solicitor,accountant, tax adviser or other professional adviser immediately.

Scheme Shareholders should note that trading of the Shares is subject to, inter alia, theperformance and prospects of the Datacraft Group, prevailing economic conditions, economicoutlook and stock market conditions and sentiments. Accordingly, our advice on the Schemedoes not and cannot take into account the future trading activities or patterns or price levels thatmay be established beyond the Latest Practicable Date.”

Scheme Shareholders are advised to read the advice of the IFA as set out in Appendix 1to this Document in its entirety.

13. EXEMPTION RELATING TO DIRECTORS’ RECOMMENDATION

13.1 Excluded Directors

The SIC has confirmed that Patrick Keith Quarmby, William Bruce Grahame Padfield,Lal Chandra Singh, Jeremy John Ord, Josua Malherbe, Brett William Dawson and StephenMichael Joubert (the “Excluded Directors”) are exempted from the requirement to make arecommendation on the Scheme to the Scheme Shareholders, in view of their directorshipsand/or other executive positions held in Dimension Data.

However, each of the Excluded Directors will still assume responsibility for the accuracy of factsstated or opinions expressed in documents or announcements issued by, or on behalf of, theCompany in connection with the Scheme.


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The material background of the Excluded Directors is set out in the following table:

Name of Director Designation on the BoardPosition within the Dimension DataGroup

Patrick Keith Quarmby • Non-Executive Chairman • Executive Director

• Holds directorships and/or executivepositions in other Dimension Data Groupcompanies

William Bruce GrahamePadfield(1)

• Executive Director• Chief Executive Officer

• Member of the Group ExecutiveCommittee


Lal Chandra Singh • Non-Executive Director • President and Chief Executive Officer ofNihilent Technologies Pvt. Ltd.(“Nihilent”), a company in whichDimension Data has a shareholding ofapproximately 35 per cent. (35%)

Jeremy John Ord • Non-Executive Director • Chairman


Josua Malherbe • Non-Executive Director • Non-Executive Director


Brett William Dawson • Alternate Director(to Jeremy John Ord)

• Executive Director

• Chief Executive Officer


Stephen Michael Joubert • Alternate Director(to Josua Malherbe)

• Executive Director


Note:

(1) William Bruce Grahame Padfield will be retaining his position as Chief Executive Officer of the Company uponcompletion of the Scheme, at which point the Company will be a wholly-owned subsidiary of Dimension Data.

As the Capital Distribution is an integral part of the Scheme, and in view of the ExcludedDirectors’ interests in the Scheme, the Excluded Directors have also abstained from making anyrecommendation on the Capital Distribution.

13.2 Independent Directors

Frank Yung-Cheng Yung, Chew Kia Ngee and Ronald John Cattell are Directors who areconsidered independent for the purposes of making a recommendation on the Scheme and theCapital Distribution to the Scheme Shareholders.


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14. INDEPENDENT DIRECTORS’ RECOMMENDATIONS

14.1 In Relation to the Scheme

Having considered the rationale and the terms of the Scheme together with the advice of the IFA,the Independent Directors unanimously recommend that, from a financial point of view, the termsof the Scheme are fair and reasonable. Accordingly the Independent Directors recommend thatScheme Shareholders VOTE IN FAVOUR of the Scheme at the Court Meeting.

Scheme Shareholders should also be aware that there is currently no certainty that the Schemewill become effective and there is no assurance that the trading volumes and market prices ofthe Shares will be maintained at the current levels prevailing as at the Latest Practicable Datein the short term if the Scheme does not become effective for whatever reason.

Scheme Shareholders are advised to read this Document in its entirety, including the advice ofthe IFA as set out in Appendix 1 to this Document.

14.2 In Relation to the Capital Distribution

The Independent Directors are of the opinion that the Capital Distribution (which is an integralpart of the Scheme) pursuant to the Capital Reduction is in the best interests of the Companyand the Scheme Shareholders. Accordingly the Independent Directors recommend that SchemeShareholders VOTE IN FAVOUR of the Capital Distribution Resolution at the EGM.

14.3 No Regard to Specific Objectives

In rendering their advice, the Independent Directors have not had regard to the specificinvestment objectives, financial situation, tax position, tax status, risk profiles or particular needsand constraints and circumstances of any individual Scheme Shareholder. As each SchemeShareholder would have different investment objectives and profiles, the Independent Directorsrecommend that any individual Scheme Shareholder who may require specific advice in relationto his individual portfolio of Shares should consult his stockbroker, bank manager, solicitor,accountant, tax adviser or other professional advisers.

15. RESPONSIBILITY STATEMENT

The Directors (including any Director who may have delegated detailed supervision of thisDocument) have taken all reasonable care to ensure that the facts stated and opinionsexpressed in this Document (other than the information in Appendices 1 and 2 to this Document,and the facts relating to Dimension Data, PwCCF and Cazenove) are fair and accurate and thatno material facts have been omitted from this Document, and they jointly and severally acceptresponsibility accordingly.

Where any information has been extracted from published or publicly available sources, the soleresponsibility of the Directors has been to ensure through reasonable enquiries that suchinformation has been accurately extracted from such sources or, as the case may be, reflectedor reproduced in this Document.


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16. GENERAL INFORMATION

Your attention is drawn to the further relevant information in the Appendices to this Document.

Yours faithfullyFor and on behalf of the Board of Directors ofDATACRAFT ASIA LTD

Frank Yung-Cheng YungIndependent Director


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1. INTRODUCTION

1.1 Announcement



1.2 Explanatory Statement

This Explanatory Statement should be read in conjunction with the full text of this Document,including the Scheme as set out on pages 228 to 235 of this Document.

Capitalised terms used in this Explanatory Statement which are not defined in this ExplanatoryStatement or in the Scheme, shall bear the same meanings as ascribed to them on pages 3 to8 of this Document.

2. RATIONALE FOR THE SCHEME

The rationale for the Scheme is set out in paragraph 3.2 of the Letter from the Board to theShareholders on pages 13 to 14 of this Document.

3. THE SCHEME

3.1 Scheme

The Scheme is proposed to all Scheme Shareholders. As at the Latest Practicable Date, theCompany has an issued share capital of US$134,313,000 comprising 461,981,427 Shares(excluding 23,230,000 treasury shares). Dimension Data holds in aggregate, directly andindirectly, 254,551,619 Shares, representing approximately 55.10 per cent. of the Shares inissue (excluding treasury shares).



(b) in consideration for the transfer of their Scheme Shares, the Scheme Shareholders willreceive the Cash Consideration for each Scheme Share transferred, comprising:

(i) the Scheme Price from Dimension Data for each Scheme Share transferred; and

(ii) the Capital Distribution by the Company for each Scheme Share held as at the BooksClosure Date.

For the avoidance of doubt, the Excluded Shareholders, being Dimension Data, its relatedcorporations and their respective nominees, will not be entitled to the Scheme Price and/or theCapital Distribution.

EXPLANATORY STATEMENT(in compliance with Section 211 of the Companies Act)

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The Scheme will also be extended to all Shares validly issued to Scheme Shareholders pursuantto the exercise of Options granted under the Datacraft Share Option Schemes on or before theFinal Option Exercise Date.

Pursuant to the Scheme, the Scheme Shares will be transferred fully paid, free from all liens,equities, charges, encumbrances, rights of pre-emption and any other third party rights orinterests or any nature whatsoever and together with all rights attached thereto as at theAnnouncement Date, including the right to receive and retain all dividends, rights and, save forthe Capital Distribution, other distributions (if any) declared, paid or made by the Company onor after the Announcement Date.

4. BASIS OF CASH CONSIDERATION

The Cash Consideration represents:

(a) a premium of approximately 34.3 per cent. over the closing price per Share on the SGX-STof US$0.99 as at 21 July 2008, being the last trading day of the Shares on the SGX-ST priorto the Announcement Date;

(b) a premium of approximately 30.6 per cent. over the volume weighted average of transactedprices of the Shares on the SGX-ST of US$1.02 over the last one month prior to theAnnouncement Date; and

(c) a premium of approximately 33.0 per cent. over the volume weighted average of transactedprices of the Shares on the SGX-ST of US$1.00 over the last three months prior to theAnnouncement Date.

5. CONDITIONS PRECEDENT

5.1 Conditions Precedent

The Scheme is conditional upon the satisfaction of a number of conditions precedent, as set outbelow:

(a) Scheme: the approval of the Scheme by the Scheme Shareholders in compliance with therequirements of Section 210(3) of the Companies Act;

(b) Scheme and Capital Distribution Court Orders: the grant of the Scheme Court Order andthe Capital Distribution Court Order by the Court and such Scheme Court Order andCapital Distribution Court Order having become final;

(c) Capital Distribution: the approval of the Capital Distribution by the Scheme Shareholdersin compliance with the requirements of Section 78G of the Companies Act;

(d) ACRA Registration: the registration of the Scheme Court Order and the Capital DistributionCourt Order with ACRA;

(e) Cash Resources: the Company having available cash resources of not less thanUS$50,000,000 as at the Record Date;

(f) No Injunctions: no injunction or other order being issued by any court of competentjurisdiction or other legal restraint or prohibition preventing the consummation of theScheme or the transactions proposed herein or any part thereof;


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(g) Regulatory Approvals: prior to the Record Date, the following being obtained and notwithdrawn:

(i) confirmation from the SIC that Rules 14, 15, 16, 17, 20.1, 21, 22, 28, 29 and 33.2 andNote 1(b) to Rule 19 of the Code shall not apply to the proposed Scheme subject toany conditions the SIC may deem fit to impose; and

(ii) the approval in-principle of the SGX-ST for the Scheme and for the proposed delistingof the Company;

(h) No Prescribed Occurrence: between the date of the Implementation Agreement and theRecord Date, no Prescribed Occurrence in relation to the Group occurs other than asrequired or contemplated by the Implementation Agreement;

(i) Company’s Representations, Warranties and Covenants:

(i) the representations and warranties of the Company set out in the ImplementationAgreement and Appendix 9 to this Document that:

(1) are qualified as to materiality being true and correct; and

(2) are not qualified as to materiality being true and correct in all material respects,

in each case as of the date of the Implementation Agreement and as of the RecordDate as though made on and as of that date except to the extent any suchrepresentation and warranty expressly relates to an earlier date (in which case as ofsuch earlier date); and

(ii) the Company shall have, as of the Record Date, performed and complied in allmaterial respects with all covenants and agreements contained in the ImplementationAgreement which are required to be performed by or complied with by it, on or priorto the Record Date; and

(j) Dimension Data’s Representations, Warranties and Covenants:

(i) the representations and warranties of Dimension Data set out in the ImplementationAgreement and Appendix 10 to this Document (other than the representation andwarranty set out in paragraph 7 of Appendix 10 to this Document) that:

(1) are qualified as to materiality being true and correct; and

(2) are not qualified as to materiality being true and correct in all material respects,

in each case as of the date of the Implementation Agreement and as of the RecordDate as though made on and as of that date except to the extent any suchrepresentation and warranty expressly relates to an earlier date (in which case as ofsuch earlier date); and

(ii) Dimension Data shall have, as of the Record Date, performed and complied in allmaterial respects with all covenants and agreements contained in the ImplementationAgreement which are required to be performed by or complied with by it, on or priorto the Record Date,

(collectively, the “Conditions”).


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5.2 Non-fulfilment of Conditions

Scheme Shareholders should note that if any one or more of the Conditions are not satisfied, theScheme will not become effective and binding.

If any of the Conditions has not been satisfied (or where applicable, has not been waived) by 31January 2009, or such other date as may be agreed between Dimension Data and the Company(the “Long-Stop Date”), the Implementation Agreement will terminate and the Scheme willlapse.

5.3 Termination Right

Shareholders should note that pursuant to the terms of the Implementation Agreement, theImplementation Agreement may be terminated at any time on or prior to the Record Date withthe prior consultation or approval, as may be applicable, of the SIC:

(a) Court Order

by either Dimension Data or the Company, if any court of competent jurisdiction orgovernmental agency has issued an order, decree or ruling or taken any other actionpermanently enjoining, restraining or otherwise prohibiting the Scheme, the Acquisition (asdefined in the Implementation Agreement), the Capital Reduction or any part thereof, orhas refused to do anything necessary to permit the Scheme, the Acquisition, the CapitalReduction or any part thereof, and such order, decree, ruling, other action or refusal shallhave become final and non-appealable;

(b) Breach

by either (i) Dimension Data, if the Company is in material breach of any provision of theImplementation Agreement (other than a provision which is qualified by a materiality test,in which case any breach shall suffice) or has failed to perform and comply in all materialrespects with any of the matters referred to in paragraph 5.1(i) of this ExplanatoryStatement on or prior to the Record Date, or (b) the Company, if Dimension Data is inmaterial breach of any provision of the Implementation Agreement (other than a provisionwhich is qualified by a materiality test, in which case any breach shall suffice) or has failedto perform and comply in all material respects with any of the matters referred to inparagraph 5.1(j) of this Explanatory Statement (other than in relation to any breach of therepresentation and warranty set out in paragraph 7 of Appendix 10 to this Document) on orprior to the Record Date, provided that either Dimension Data or the Company, as the casemay be, has given written notice to the other party of its intention to terminate theImplementation Agreement. In this circumstance, the Implementation Agreement shallterminate on the date falling five (5) Business Days after the date of such notice oftermination; and

(c) Shareholders’ Approval

by Dimension Data or the Company, if the resolution(s) submitted to the EGM and/or theCourt Meeting are not approved (without amendment) by the requisite majorities.

The representations and warranties of each of the Company and Dimension Data provided in theImplementation Agreement are reproduced and set out in Appendix 9 and Appendix 10 of thisDocument respectively.


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Notwithstanding anything contained in the Implementation Agreement, the ImplementationAgreement will terminate if any of the Conditions has not been satisfied (or waived, asapplicable) by the Long-Stop Date, except that:

(i) in the event of any non-fulfilment of the Conditions in paragraph 5.1(h) of this ExplanatoryStatement (in relation to the Prescribed Occurrences relating to the Group) and paragraph5.1(i) of this Explanatory Statement, Dimension Data can only rely on such non-fulfilmentof any such Condition to terminate the Implementation Agreement with prior consultationwith the SIC; and

(ii) in the event of any non-fulfilment of the conditions precedent in paragraph 5.1(j) of thisExplanatory Statement, the Company can only rely on such non-fulfilment of any suchcondition precedent to terminate the Implementation Agreement with prior consultation withthe SIC.

The list of Prescribed Occurrences is set out in Appendix 11 to this Document.

6. REGULATORY APPROVALS

6.1 SIC

The SIC has confirmed, inter alia, that Rules 14, 15, 16, 17, 20.1, 21, 22, 28, 29 and 33.2 andNote 1(b) to Rule 19 of the Code do not apply to the Scheme, subject to the following conditions:

(a) Dimension Data and its concert parties as well as the common Substantial Shareholdersof Dimension Data and the Company abstain from voting on the Scheme;

(b) this Document discloses the names of Dimension Data and its concert parties, as well astheir current voting rights in the Company as of the Latest Practicable Date and after theScheme;

(c) the Directors who are also directors of Dimension Data or who are acting in concert withDimension Data abstain from making a recommendation on the Scheme to the SchemeShareholders; and

(d) the Company appoints an independent financial adviser to advise the SchemeShareholders on the Scheme.

With respect to paragraph 6.1(a) above, please see paragraph 9 of the Letter from the Board tothe Shareholders on page 26 of this Document for further details.

With respect to paragraph 6.1(b) above, the Company understands that save as disclosed in thisDocument, none of the parties acting in concert with Dimension Data has any interest in theShares.

With respect to paragraph 6.1(c) above, please see paragraph 13 of the Letter from the Boardto the Shareholders on pages 28 to 29 of this Document for further details.

With respect to paragraph 6.1(d) above, PwCCF has been appointed as the IFA.


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6.2 Court

The Scheme and the Capital Distribution are subject to sanction by the Court as set out underparagraph 5.1(b) of the Explanatory Statement.

6.3 SGX-ST



7. ACTION TO BE TAKEN BY SCHEME SHAREHOLDERS

7.1 Appointment of Proxies

Scheme Shareholders who are unable to attend the Court Meeting and/or the EGM arerequested to sign and return the Proxy Forms attached to this Document in accordance with theinstructions printed thereon as soon as possible and, in any event, so as to reach the registeredoffice of the Company at 6 Temasek Boulevard, #26-01/05 Suntec Tower Four, Singapore038986, not later than forty-eight (48) hours before the time appointed for the Court Meeting andthe EGM, as relevant. If the Proxy Forms for the Court Meeting are not so lodged, they may behanded to the Chairman of the Court Meeting at the Court Meeting.

The completion and return of Proxy Forms will not prevent Scheme Shareholders from attendingand voting at the Court Meeting and/or the EGM in person if they subsequently wish to do so.In such event, the relevant Proxy Forms will be deemed to be revoked.

7.2 When Depositor Regarded as Shareholder

A Depositor shall not be regarded as a Scheme Shareholder entitled to attend and vote at theCourt Meeting and/or the EGM unless he is shown to have Shares entered against his name inthe Depository Register as at forty-eight (48) hours before the time fixed for holding the CourtMeeting and/or the EGM, as certified by CDP to the Company.

8. IMPLEMENTATION OF THE SCHEME AND THE CAPITAL DISTRIBUTION

8.1 Application to Court for Sanction

Upon the Scheme being approved by a majority in number of the Scheme Shareholders presentand voting, either in person or by proxy, at the Court Meeting, holding at least three-fourths invalue of the Scheme Shares, and the Capital Distribution Resolution being duly passed at theEGM, an application will be made to the Court by the Company for the sanction of the Schemeand for confirmation and approval of the Capital Distribution.


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8.2 Procedure

If the Court sanctions the Scheme and confirms and approves the Capital Distribution,Dimension Data and the Company will take necessary steps to render the Scheme effective andbinding and the following will be implemented:

(a) the Scheme Shares held by Entitled Scheme Shareholders will be transferred to DimensionData and/or its nominees for the Cash Consideration to be paid to the Entitled SchemeShareholders for each Scheme Share transferred, as follows:

(i) in the case of Entitled Scheme Shareholders being Depositors, the Company shallinstruct CDP, for and on behalf of the Entitled Scheme Shareholders, to debit, notlater than three (3) Business Days after the Effective Date, all the Shares standing tothe credit of the Securities Account of such Entitled Scheme Shareholders and creditall of such Shares to the Securities Account of Dimension Data and/or its nomineesor such Securities Account as directed by Dimension Data; and

(ii) in the case of Entitled Scheme Shareholders not being Depositors, the Companyshall authorize any person to execute or effect on behalf of all such Entitled SchemeShareholders, an instrument or instruction of transfer of all the Shares held by suchEntitled Scheme Shareholders, and every such instrument or instruction of transferso executed shall be effective as if it had been executed by the relevant EntitledScheme Shareholders;

(b) from the Effective Date, all existing share certificates relating to the Scheme Shares heldby the Entitled Scheme Shareholders will cease to have any effect;

(c) Entitled Scheme Shareholders (not being Depositors) are required to forward their existingshare certificates relating to their Scheme Shares to the Share Registrar’s office at therequest of Dimension Data;

(d) Dimension Data shall, not later than ten (10) calendar days after the Effective Date, andagainst the transfer of the Scheme Shares set out in paragraph 8.2(a) above, makepayment of the Scheme Price payable on the transfer of the Scheme Shares to:

(i) each Entitled Scheme Shareholder (not being a Depositor) by sending a cheque forthe aggregate Scheme Price payable to such Entitled Scheme Shareholder made outin favour of such Entitled Scheme Shareholder by post to his address in the Registerof Members of the Company at the close of business on the latest practicable dateprior to the despatch of such cheque, at the sole risk of such Entitled SchemeShareholder, or in the case of joint Entitled Scheme Shareholders, to the first namedEntitled Scheme Shareholder made out in favour of such Entitled SchemeShareholder by post to his address in the Register of Members of the Company at theclose of business on the latest practicable date prior to the despatch of such cheque,at the sole risk of such Entitled Scheme Shareholders; and

(ii) each Entitled Scheme Shareholder (being a Depositor) by making payment of theaggregate Scheme Price payable to such Entitled Scheme Shareholder to CDP. CDPshall send to such Entitled Scheme Shareholder, by post to his address in theDepository Register at the close of business on the latest practicable date prior to thedespatch of such cheque and at the sole risk of such Entitled Scheme Shareholder,a cheque for the payment of such aggregate Scheme Price made out in favour ofsuch Entitled Scheme Shareholder; and


38

(e) not later than ten (10) calendar days after the Effective Date and against the transfer of theScheme Shares set out in paragraph 8.2(a) above, the Company shall make payment ofthe Capital Distribution to each Entitled Scheme Shareholder (whose entitlement to theCapital Distribution shall be determined on the basis of the Entitled Scheme Shareholder’sholdings of Scheme Shares in the Register of Members and/or the Depository Register asat the Books Closure Date) as follows:

(i) for each Entitled Scheme Shareholder (not being a Depositor) entitled thereto bysending a cheque for the Capital Distribution payable to such Entitled SchemeShareholder made out in favour of such Entitled Scheme Shareholder by post to hisaddress in the Register of Members of the Company at the close of business on thelatest practicable date prior to the despatch of such cheque, at the sole risk of suchEntitled Scheme Shareholder, or in the case of joint Entitled Scheme Shareholders,to the first named Entitled Scheme Shareholder made out in favour of such EntitledScheme Shareholder by post to his address in the Register of Members of theCompany at the close of business on the latest practicable date prior to the despatchof such cheque, at the sole risk of such Entitled Scheme Shareholders; and

(ii) for each Entitled Scheme Shareholder (being a Depositor) by making payment of theCapital Distribution payable to such Entitled Scheme Shareholder to CDP. CDP shallsend to such Entitled Scheme Shareholder, by post to his address in the DepositoryRegister at the close of business on the latest practicable date prior to the despatchof such cheque and at the sole risk of such Entitled Scheme Shareholder, a chequefor the payment of the Capital Distribution made out in favour of such Entitled SchemeShareholder.

Assuming that both the Scheme and the Capital Reduction become effective on 7 November2008, the posting of cheques for each of the Scheme Price and the Capital Distribution under theScheme in the manner set out in paragraphs 8.2(d) and 8.2(e) above, is expected to take placeon or before 11 November 2008.

On or after the day being six (6) calendar months after the posting of such cheques relating tothe Scheme Price by Dimension Data and the Capital Distribution by the Company, DimensionData and the Company shall have the right to cancel or countermand payment of any suchcheque which has not been cashed (or has been returned uncashed) and shall place each of theScheme Price monies and the Capital Distribution monies in two bank accounts, in DimensionData’s name in respect of the Scheme Price monies and the Company’s name in respect of theCapital Distribution monies, each with a licensed bank in Singapore selected by Dimension Dataand the Company. Each of Dimension Data and the Company or their successor entities shallhold such monies until the expiration of six (6) years from the Effective Date and shall prior tosuch date make payments therefrom of sums (without interest in accordance with Clause 8(b)of the Scheme) payable pursuant to Clause 8(b) of the Scheme to persons who satisfyDimension Data in respect of the Scheme Price monies and/or the Company in respect of theCapital Distribution monies or their successor entities that they are respectively entitled theretoand that the cheques referred to in Clauses 5 and 6 of the Scheme for which they are payeeshave not been cashed.

On the expiry of six (6) years from the Effective Date, each of Dimension Data and the Companyshall be released from any further obligation to make any payments of the Scheme Price underthe Scheme and the Capital Distribution, and the Company and its successor entity shall transferto Dimension Data the balance (if any) of the sums then standing to the credit of the bankaccount referred to in Clause 8(a) of the Scheme, including accrued interest, subject, if


39

applicable, to the deduction of interest, tax or any withholding tax or any other deduction requiredby law and subject to the deduction of any expenses.

As of and from the Effective Date, each existing share certificate representing a former holdingof Scheme Shares by the Scheme Shareholders (not being Depositors) will cease to beevidence of title to the Scheme Shares represented thereby.

8.3 Books Closure Date

Subject to the approval of Scheme Shareholders of the Scheme at the Court Meeting, theCapital Distribution at the EGM and the sanction of the Scheme and the Capital Distribution bythe Court, notice of the Books Closure Date will be given in due course for the purpose ofdetermining the entitlements of the Scheme Shareholders to the Cash Consideration under theScheme and the Capital Distribution. The Books Closure Date is tentatively scheduled on 31October 2008 at 5.00 p.m..

No transfer of the Shares where the certificates relating thereto are not deposited with the CDPmay be effected after the Books Closure Date.

The Scheme is tentatively scheduled to become effective on or about 7 November 2008 andaccordingly (assuming the Scheme becomes effective on 7 November 2008), the Shares areexpected to be delisted and withdrawn from the Official List of the SGX-ST with effect from 7November 2008 at 9.00 a.m.. It is therefore expected that, subject to the approval of the SGX-ST,the Shares will cease to be traded on the SGX-ST from 24 October 2008 at 5.00 p.m., beingthree (3) Market Days before the expected Books Closure Date.

Scheme Shareholders (not being Depositors) who wish to trade in their Shares are required todeposit with CDP their certificates relating to their Shares, tentatively by 13 October 2008, beingtwelve (12) Market Days prior to the expected Books Closure Date.

8.4 Settlement and Registration Procedures

Subject to the Scheme and the Capital Distribution becoming effective, the following settlementand registration procedures will apply:

(a) Entitled Scheme Shareholders whose Shares are deposited with the CDP

Entitlements to the Cash Consideration will be determined on the basis of the EntitledScheme Shareholders (being Depositors) and the number of Shares standing to the creditof their Securities Account at 5.00 p.m. on the Books Closure Date.

Entitled Scheme Shareholders (being Depositors) who have not already done so arerequested to take the necessary action to ensure that the Shares owned by them arecredited to their Securities Account by 5.00 p.m. on the Books Closure Date.

Following the Effective Date, CDP will debit from each relevant Securities Account thenumber of Shares standing to the credit of the Securities Account of the relevant EntitledScheme Shareholder (being a Depositor) based on the number of Shares standing to thecredit of his Securities Account as at the Books Closure Date.


40

(b) Entitled Scheme Shareholders whose Shares are not deposited with the CDP

Entitlements to the Cash Consideration will be determined on the basis of the SchemeShareholders (not being Depositors) and their holdings of Shares appearing in the Registerof Members on the Books Closure Date, which is expected to be at 5.00 p.m. on 31 October2008.

Entitled Scheme Shareholders who have not already done so are requested to take thenecessary action to ensure that the Shares owned by them are registered in their nameswith the Share Registrar by the Books Closure Date.

From the Effective Date, each existing share certificate representing a former holding ofShares by Entitled Scheme Shareholders (not being Depositors) will cease to be evidenceof title to the Shares represented thereby. Within ten (10) calendar days of the EffectiveDate, Dimension Data and the Company shall make payment of the Cash Consideration toeach Entitled Scheme Shareholder based on his holding of the Shares as at the BooksClosure Date.

9. DIRECTORS’ AND SUBSTANTIAL SHAREHOLDERS’ INTERESTS

The interests of the Directors and Substantial Shareholders in the Shares as at the LatestPracticable Date are set out in Appendix 3 to this Document.

The effect of the Scheme on such interests of the Directors and Substantial Shareholders doesnot differ from that of the other Scheme Shareholders except that, after the Scheme becomeseffective, Dimension Data will in aggregate, hold 100 per cent. of the issued share capital of theCompany.

10. OVERSEAS SCHEME SHAREHOLDERS

10.1 Overseas Shareholders

The sending of this Document to Shareholders whose addresses are outside Singapore, asshown in the Register of Members of the Company or, as the case may be, in the DepositoryRegister (“Overseas Shareholders”) may be affected by the laws of the relevant overseasjurisdictions. Accordingly, Overseas Shareholders should inform themselves about and observeany applicable legal requirements.

This Document may not be sent to any Overseas Shareholders due to the potential restrictionson sending such documents into the relevant overseas jurisdictions. For the avoidance of doubt,the Scheme and the Capital Distribution are proposed to all Scheme Shareholders and apply toall Scheme Shares, including those Scheme Shareholders to whom this Document has not beenand will not be sent.

10.2 Copies of the Document

Scheme Shareholders, including Overseas Shareholders, may obtain additional copies of thisDocument and any related documents, during the normal business hours on any day prior to thedate of the Court Meeting, from the registered office of the Company in Singapore at 6 TemasekBoulevard, #26-01/05 Suntec Tower Four, Singapore 038986. Alternatively, an OverseasShareholder may write in to the Company at the same address to request for this Document and


41

any related documents to be sent to an address in Singapore by ordinary post at his own risk,up to three (3) Market Days prior to the date of the Court Meeting.

It is the responsibility of any Overseas Shareholder who wishes to request for this Document andany related documents to satisfy himself as to the full observance of the laws of the relevantjurisdiction in that connection, including the obtaining of any governmental or other consentwhich may be required and compliance with all necessary formalities or legal requirements. Inrequesting for this Document and any related documents, the Overseas Shareholder representsand warrants to Dimension Data and the Company that he is in full observance of the laws of therelevant jurisdiction in that connection, and that he is in full compliance with all necessaryformalities or legal requirements.

10.3 Notice

The Company and Dimension Data each reserves the right to notify any matter to any or allOverseas Scheme Shareholders by announcement to the SGX-ST or paid advertisement in adaily newspaper published and circulated in Singapore, in which case such notice shall bedeemed to have been sufficiently given notwithstanding any failure of any Scheme Shareholderto receive or see such announcement or advertisement.

11. ADVICE OF THE INDEPENDENT FINANCIAL ADVISER

The letter from PwCCF to the Independent Directors on the Scheme setting out its advice to theIndependent Directors is set out in Appendix 1 to this Document.

12. DIRECTORS’ RECOMMENDATION

The recommendations of the Independent Directors in relation to the Scheme and the CapitalDistribution are set out on page 30 of this Document.

13. GENERAL INFORMATION

Your attention is drawn to the further relevant information, including the Directors’ andSubstantial Shareholders’ interests in the Shares, set out in the Appendices to this Document.The Explanatory Statement should be read in conjunction with, and is qualified by, the full textof this Document, including the Scheme as set out on pages 228 to 235 of this Document.


42

22 September 2008

To: The Independent DirectorsDatacraft Asia Ltd6 Temasek Boulevard#26-01/05 Suntec Tower FourSingapore 038986

Dear Sirs



Unless otherwise defined or the context otherwise requires, all terms defined in the Scheme Documentdated 22 September 2008 shall have the same meaning herein.

1. BACKGROUND



Dimension Data is the holding company of Datacraft and has held a majority stake in Datacraftsince 1997. As at the Latest Practicable Date, Dimension Data holds in aggregate, directly andindirectly, 254,551,619 Shares, representing approximately 55.1% of the Shares in issue.

PricewaterhouseCoopers Corporate Finance Pte Ltd (“PwCCF”) has been appointed as theindependent financial adviser (the “IFA”) to the Independent Directors for the purposes ofmaking the recommendation to Scheme Shareholders in relation to the Scheme. This letter setsout our evaluation of the financial terms of the Scheme and our opinion thereon (the “IFALetter”). It forms part of the scheme document dated 22 September 2008 issued by theCompany (the “Scheme Document”), containing, inter alia, details of the Scheme and therecommendation of the Independent Directors in respect of the Scheme.

2. TERMS OF REFERENCE

We have been appointed to evaluate the financial terms of the Scheme and to advise theIndependent Directors in their deliberation to arrive at their recommendation as to whetherScheme Shareholders should vote for or against the Scheme.

We do not, by this letter, make any representation or warranty in relation to the merits of theScheme.

We have confined our evaluation to the financial terms of the Scheme and our terms of referencedo not require us to evaluate or comment on the rationale for, commercial risks and/or

APPENDIX 1: LETTER FROM PWCCF TO THE INDEPENDENT DIRECTORS

43

commercial merits of the Scheme or the future prospects of the Company and its subsidiaries(the “Datacraft Group” or “Group”) and we have not made such evaluation or comment. Suchevaluation or comment, if any, remains the sole responsibility of the Directors and/or themanagement of the Company, although we may draw upon their views or make such commentsin respect thereof (to the extent deemed necessary or appropriate by us) in arriving at ouropinion set out in this letter.

We have not been requested to, and we do not, express any opinion on the relative merits of theScheme as compared to any other alternative transaction. We have not been requested norauthorised to solicit, and we have not solicited, any indications of interest from any third partywith respect to the Shares or any assets of the Group.

We have held discussions with the Directors and the management of the Company and haveexamined publicly available information collated by us as well as information, both written andverbal, provided to us by the Directors and the management of the Company and theprofessional advisers of the Company including information contained in the Scheme Document.We have not independently verified such information, whether written or verbal, and accordingly,we cannot and do not represent or warrant, expressly or implied and do not accept anyresponsibility for, the accuracy, completeness or adequacy of such information. We havenevertheless made such enquiries and exercised our judgment as we deemed necessary orappropriate in assessing such information and are not aware of any reason to doubt the reliabilityof the information.

We have relied upon the assurances of the Directors (including those who have delegateddetailed supervision of the Scheme Document) that the Scheme Document has been approvedand that the Directors have also made all reasonable enquiries, that to the best of theirknowledge and belief, the facts stated and the opinions expressed in the Scheme Document arefair and accurate in all material respects as at the date of the Scheme Document and that thereare no material facts the omission of which would make any statement in the Scheme Documentmisleading in any material respect. Accordingly, the Directors collectively and individually acceptresponsibility for the accuracy of information given in the Scheme Document as set out in the“Directors’ Responsibility Statement”. In addition, the Directors have similarly provided us with aresponsibility statement in a letter dated 22 September 2008, which we have relied upon.

Our opinion as set out in this letter is based upon prevailing market, economic, industry,monetary and other conditions (if applicable) and the information made available to us containedin the Scheme Document as of the Latest Practicable Date. Such conditions may changesignificantly over a relatively short period of time and accordingly, we assume no responsibilityto update, revise or reaffirm our opinion in light of any subsequent development after the LatestPracticable Date that may affect our opinion contained herein.

In addition, we have been appointed to render an opinion as of the Latest Practicable Date andare not required to express, and we do not express, an opinion on the future growth prospects,earnings potential, financial position and/or financial performance of the Datacraft Group.Scheme Shareholders should take note of any announcement relevant for their consideration ofthe Scheme which may be released by the Company after the Latest Practicable Date.

In rendering our opinion, we have not considered the specific objectives, financial situation, taxposition, risk profile or particular needs and constraints of any individual Scheme Shareholder.As each Scheme Shareholder would have different investment objectives and profiles, werecommend that any individual Scheme Shareholder who may require specific advice in relation


44

to his specific investment portfolio should consult his stockbroker, bank manager, solicitor,accountant, tax adviser or other appropriate professional adviser immediately.

This letter is addressed to the Independent Directors and is for their benefit in connection withand for the purpose of their consideration of the Scheme. However, the recommendations madeby them shall remain the responsibility of the Independent Directors.

The Company has been separately advised by its other advisers in the preparation of theScheme Document (other than this letter). We have had no role or involvement and have notprovided any advice, financial or otherwise, whatsoever in the preparation, review andverification of the Scheme Document (other than this letter). Accordingly, we take noresponsibility for, and express no views on, the contents of the Scheme Document (other thanthis letter).

Our opinion in relation to the Scheme should be considered in the context of the entirety of thisletter and the Scheme Document.

3. BACKGROUND ON THE COMPANY AND DIMENSION DATA

Information on the Company and on Dimension Data is set out in Section 2 of the SchemeDocument.

4. THE SCHEME

Details of the Scheme are set out in Section 3 of the Scheme Document and Section 3 of theExplanatory Statement. Shareholders are advised to refer to these respective sections for moredetails on the Scheme.

A summary of the key terms of the Scheme is set out below:

4.1 Terms of the Scheme

The Scheme is proposed to all Scheme Shareholders. As at the Latest Practicable Date, theCompany has an issued share capital of US$134,313,000 comprising 461,981,427 Shares(excluding 23,230,000 treasury shares). As at the Latest Practicable Date, Dimension Dataholds in aggregate, directly and indirectly, 254,551,619 Shares, representing approximately55.10 per cent. of the Shares in issue (excluding treasury Shares).



(b) in consideration of the transfer of their Scheme Shares, the Scheme Shareholders willreceive an aggregate of US$1.33 in cash for each Scheme Share transferred (the “CashConsideration”), comprising:

(i) US$1.09 in cash from Dimension Data for each Scheme Share transferred (the“Scheme Price”); and

(ii) US$0.24 in cash from the Company for each Scheme Share held as at the BooksClosure Date pursuant to the Capital Distribution.


45

For the avoidance of doubt, the Excluded Shareholders, being the Dimension Data, its relatedcorporations and their respective nominees, will not be entitled to the Scheme Price and/or theCapital Distribution.

The Scheme will also be extended to all Shares validly issued pursuant to the exercise ofOptions granted under the Datacraft Share Option Schemes on or before the Final OptionExercise Date.

Pursuant to the Scheme, the Shares will be transferred fully paid, free from all liens, equities,charges, encumbrances, rights of pre-emption and any other third party rights or interests or anynature whatsoever and together with all rights attached thereto as at the Announcement Date,including the right to receive and retain all dividends, rights and, save for the Capital Distribution,other distributions (if any) declared, paid or made by the Company on or after the AnnouncementDate.

4.2 Rationale for the Scheme

The rationale for implementing the Scheme is as follows:

(a) Strengthen the Company’s position in the market

Dimension Data has held a majority stake in the Company since 1997, during which timethere has been an increasing alignment of the strategic and operating models of bothcompanies. Dimension Data continues to pursue its strategy of driving profitable growthfrom its global presence and believes that it would gain increased exposure to attractivegrowth markets through full ownership of one of the leading information technologyservices and solutions providers in Asia-Pacific.

Dimension Data believes that the Company’s leadership position in Asian markets will bestrengthened by bringing it fully within the Dimension Data Group, offering it the opportunityto leverage more effectively the resources of the wider group and capitalise onopportunities in the market. Dimension Data believes that, if privatised, the Company’smanagement will be able to react faster with greater flexibility to available opportunitiesinternationally and accelerate its growth in key markets.

(b) Reduced costs and improved efficiency

As a listed entity, the Company has to incur listing, compliance and other related costsassociated with continuing listing requirements under the Listing Manual. If privatised,efficiencies would result from greater sharing of services and resources with DimensionData’s other strategic business units. In particular, Dimension Data and the Companywould be better able to freely transfer intellectual property, share best practices and ensureunfettered staff mobility within the enlarged group. Similarly, Dimension Data and theCompany will be able to fully align their businesses to increase operational efficiencies.Management of group-wide cashflows and capital structure would also be significantlyimproved.

(c) Public listing no longer beneficial

The Company’s public listing no longer serves a material purpose as the Company has notraised any funds from the capital markets since the year 2000, and there is no foreseeablerequirement to do so. Further, since being excluded from the MSCI Singapore Index inmid-2006, the Company has experienced a reduced level in the trading of the Shares, withaverage daily traded volume over the last 12 months down approximately 92 per cent. on


46

the average daily traded volume in the three years prior to June 2006. The low tradingliquidity of the Shares limits the purpose of its public listing and reduces the effectivenessof its employee incentive schemes.

(d) Attractive premium to share price

The Scheme provides an opportunity for Scheme Shareholders to realise their investmentin the Company for cash at an attractive premium to recent market prices. The aggregateCash Consideration (including the Capital Distribution) represents a 33.0 per cent.premium over the volume weighted average of transacted prices of the Shares on theSGX-ST of US$1.00 over the last three months prior to the Announcement Date.

4.3 Future Plans for the Company

Dimension Data has been integrally involved with the Company for 11 years and, in the event theScheme becomes effective, anticipates minimal changes in the operations of the Company.Dimension Data intends to continue the Company’s services and solutions portfolio and maintainits go-to-market strategy, which are already closely aligned to that of Dimension Data. It alsointends to retain the Datacraft name due to the considerable brand equity and recognition builtup over the years to avoid significant costs in building a new brand across 13 different countries.Dimension Data believes that the Company has a strong and experienced management teamand committed employees who are key and valued members of the Dimension Data Group andtherefore also does not anticipate any change in the management and reporting structure orenvision any retrenchments. Save as disclosed above, Dimension Data has no near-term plans,in the event that the Scheme becomes effective, to (a) introduce any major changes to thebusinesses of the Group, (b) make any major disposal or redeployment of assets (including thefixed assets of the Group) or (c) discontinue the employment of the employees of the Group.

4.4 Delisting

If the Scheme becomes effective, Dimension Data will own the entire issued share capital of theCompany.



5. CAPITAL DISTRIBUTION

Details of the Capital Distribution are set out in Section 4 of the Scheme Document.Shareholders are advised to refer to this section for more details on the Capital Distribution.


47

A summary of the key terms of the Capital Distribution is set out below:

5.1 Capital Distribution

The Capital Distribution (which is an integral part of the Scheme), is proposed to be effected byway of a Capital Reduction, and will consist of a return to Scheme Shareholders of US$0.24 incash from the Company for each issued Scheme Share held as at the Books Closure Date, theaggregate amount of which is up to US$52,600,000 in cash. As at 30 June 2008, the issuedshare capital of the Company is US$134,217,000, comprising 461,890,427 Shares (excluding23,321,000 treasury shares) in issue and there are 33,132,000 Options outstanding.

The Capital Reduction will be effected in the following manner:

(a) the issued share capital of the Company will be reduced from approximatelyUS$134,217,000 to approximately US$81,617,000 or such higher amount remaining aftercancelling the amount required to effect the Capital Distribution;

(b) the Company will make a cash distribution of US$0.24 for each Scheme Share held by oron behalf of the Scheme Shareholders from the credit of up to US$52,600,000 arising outof the Capital Reduction; and

(c) no Shares will be cancelled pursuant to the Capital Reduction.

The Capital Distribution will also be extended to all Shares validly issued pursuant to theexercise of Options on or before a Final Option Exercise Date.

For the avoidance of doubt, the Excluded Shareholders, being Dimension Data, its relatedcorporations and their respective nominees will, not be entitled to the Capital Distribution.

5.2 Rationale for the Capital Distribution

The Capital Distribution forms an integral part of the Scheme and is inter-conditional with theScheme being effective. The Directors are of the view that there is no difference betweenDimension Data using its own funds to acquire the Scheme Shares and having the Companyfund part of the acquisition, since in the event that the Scheme becomes effective, DimensionData will own the entire issued share capital of the Company and will effectively have ownershipof any cash held in the Company’s cash balances. As the Capital Distribution is intended to formpart of the consideration for Dimension Data’s acquisition of the Scheme Shares, the ExcludedShareholders will not be entitled to the Capital Distribution.

The Directors consider that the Company has sufficient cash resources to undertake the CapitalDistribution which will be payable to entitled Scheme Shareholders as part of the CashConsideration.

5.3 Financial effects of the Capital Distribution

Details of the financial effects of the Capital Distribution are set out in Section 4.5 of the SchemeDocument. Shareholders are advised to refer to this section for more details on the financialeffects of the Capital Distribution.


48

6. OPTIONS PROPOSAL

Details of the Options Proposal are set out in Section 3.4 of the Scheme Document.Shareholders are advised to refer to this section for more details on the Options Proposal. Weare not required to comment on the Options Proposal. Please refer to Section 3.4 (d) of theScheme Document for the opinion of Deloitte, the auditors of Datacraft in relation to the OptionsProposal.

7. ASSESSMENT OF THE FINANCIAL TERMS OF THE SCHEME

In assessing the financial terms of the Scheme, we have considered the following factors:

(a) the historical traded prices and trading activity of the Shares over selected referenceperiods;

(b) the premium implied in the Cash Consideration against successful privatisation/delistingtransactions for companies listed on the Mainboard of the SGX-ST;

(c) the implied valuation ratios of Datacraft against listed companies broadly comparable toDatacraft;

(d) the implied transaction multiples of Datacraft against acquisition transactions in theinformation technology (the “IT”) services sector; and

(e) other relevant considerations.

These factors are discussed in greater detail in the ensuing sections.

7.1 Historical traded prices and trading activity of the Shares

7.1.1 Share price performance

The trend of the daily closing prices and trading volumes of the Shares for the 2-yearperiod prior to the Announcement Date and up to the Latest Practicable Date is set outbelow:

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

1.80

Jul

2006

Aug

200

6

Sep

200

6

Oct

200

6

Nov

200

6

Dec

200

6

Jan

2007

Feb

200

7

Mar

200

7

Apr

200

7

May

200

7

Jun

2007

Jul

2007

Aug

200

7

Sep

200

7

Oct

200

7

Nov

200

7

Dec

200

7

Jan

2008

Feb

200

8

Mar

200

8

Apr

200

8

May

200

8

Jun

2008

Jul

2008

Aug

200

8

Sto

ck P

rice

(US

$)

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

6.5

7.0

Vol

ume

(mill

ion)

Datacraft Volume Datacraft Straits Times Index Scaled Cash Consideration

Cash Consideration of US$1.33

Announcement Date

(Source: Bloomberg and PwCCF analysis)


49

Under ordinary circumstances, the market valuation of shares traded on a recognisedstock exchange may be affected by, inter alia, its relative liquidity, the size of its freefloat, the extent of research coverage, the investor interest it attracts and the generalmarket sentiment at a given period in time. Shareholders should note that the pasttrading performance of the Shares should not be relied upon as a guide of its futuretrading performance. Therefore, this analysis serves as an illustrative guide only.

A summary of the salient announcements made by Datacraft during the aforesaidperiod are set out below. During the aforesaid period, Datacraft has announced variouscontract wins which are not included in the summary below as the contracts have nomaterial impact on the corresponding financial years.

Announcement Date Events

3 August 2006 Announcement of its financial results for the financial periodended (the “FPE”) 30 June 2006

15 November 2006 Announcement of its full year financial results for thefinancial year ended (the “FYE”) 30 September 2006

5 December 2006 Announcement of the acquisition of 39 shares in DatacraftJapan Inc (“DCJ”) from certain minority shareholders for anominal consideration of 1.6 million yen (US$13,600),increasing its shareholding in DCF from approximately 90%to approximately 91%

2 February 2007 Announcement of its financial results for the FPE 31December 2006

3 May 2007 Announcement of the acquisition of 52 shares in DCJ fromcertain minority shareholders for a nominal consideration of2.1 million yen (US$17,800), increasing its shareholding inDCF from approximately 91% to approximately 93%

9 May 2007 (i) Announcement of the proposed joint venture withSumisho Computer Systems in Japan which willprovide synergistic benefits to Datacraft

(ii) Announcement of its financial results for the FPE 31March 2007

1 August 2007 Announcement of its financial results for the FPE 30 June2007

14 November 2007 Announcement of its full year financial results for the FYE30 September 2007

7 December 2007 Announcement on conditional agreement to acquire thebusiness of Security-Assessment.com, an IT securityconsulting practice based in New Zealand

1 February 2008 Announcement of its financial results for the FPE 31December 2007


50

Announcement Date Events

5 February 2008 Announcement on the issue price for each new share to beissued pursuant to the Datacraft’s scrip dividend scheme

1 April 2008 Announcement on awards of share grants pursuant toDatacraft’s performance share plan. Number of Sharessubject to the awards is 1,098,000

14 May 2008 Announcements of its financial results for the FPE 31 March2008

22 July 2008 Announcement in relation to the Scheme

13 August 2008 Announcement of its financial results for the FPE 30 June2008

(Source: SGX-ST announcements)

The volume weighted average price (the “VWAP”) and other trading statistics of theShares for the selected reference periods are set out below:

AverageDaily

TradingVolume(1)

DailyTrading

Volume as aPercentage

of PublicFloat(2)

(%)

HighestTradedPrice(US$)

LowestTradedPrice(US$)

VWAP(US$)

Premium ofthe Cash

Considerationover VWAP

(%)

Periods Prior To The Announcement Date

Last 2-year 971,202 0.5 1.44 0.87 1.09 22.0

Last 1-year 609,135 0.3 1.32 0.87 1.08 23.1

Last 6-month 488,298 0.2 1.16 0.87 0.99 34.3

Last 3-month 366,097 0.2 1.08 0.92 1.00 33.0

Last 1-month 140,810 0.1 1.07 0.99 1.02 30.4

Last Trading Day(3) 164,000 0.1 1.00 0.99 0.99 34.3

After the Announcement Date

Between theAnnouncementDate and theLatest PracticableDate

979,184 0.5 1.30 1.26 1.28 3.9

Latest PracticableDate

759,000 0.4 1.28 1.27 1.28 3.9

(Source: Bloomberg & PwCCF analysis)

Notes:

(1) The average daily trading volume of the Shares is calculated based on the total volume of Sharestraded during the period under consideration divided by the number of trading days during that period.


51

(2) The public float excludes Shares held by Dimension Data, its related corporation and those held by thedirectors of the Company (the “Public Float”). It represents approximately 44.5% of the Shares in issueas at the Announcement Date (Source: Company).

(3) Refers to 21 July 2008, being the last trading day on which the Shares were traded prior to theAnnouncement Date.

Based on the above, we note the following:

(a) Over the past 2-year period prior to the Announcement Date, the Shares havegenerally fluctuated from a low of US$0.87 to a high of US$1.44 per Share. Thus,the Cash Consideration represents a premium of approximately 52.9% and adiscount of approximately 7.6% over the lowest and highest transacted pricerespectively;

(b) The Cash Consideration represents a premium of 22.0%, 23.1%, 34.3%, 33.0%,30.4% and 34.3% over the VWAP of the Shares for the 2-year period, 1-yearperiod, 6-month period, 3-month period, 1-month period and on the Last TradingDay on which the Shares were traded prior to the Announcement Date;

(c) Between the Announcement Date and the Latest Practicable Date, the Shareprice has fluctuated between US$1.26 to US$1.30 per Share on an averagetrading volume of approximately 979,184 Shares. The Cash Considerationrepresents a premium of 2.3% to a premium of 5.6% based on the range of themarket price of the said period;

(d) The Cash Consideration represents a premium of 3.9% over the last transactedprice of the Shares on the Latest Practicable Date; and

(e) During the last 2-year period and 1-year period prior to the Announcement Date,the average daily trading volume for the Shares were 971,202 and 609,135representing approximately 0.5% and 0.3% of the Public Float respectively.Further, during the 6-month period, 3-month period and 1-month period prior tothe Announcement Date, the average trading volume for the Shares were488,298, 366,097 and 140,810 representing approximately 0.2%, 0.2% and 0.1%of the Public Float respectively. This demonstrates a general decline in thetrading activity of the Shares in the last 2-year period prior to the AnnouncementDate.

7.1.2 Relative Share price performance

We have benchmarked the market price performance of the Shares relative to theperformance of the Straits Times Index (the “STI”) for the last 2-year period prior to theAnnouncement Date and up to the Latest Practicable Date.

The table below sets out the market price movement of Datacraft and the STI between23 July 2006, being the 2-year period prior to the Announcement Date and up to theLatest Practicable Date.


52

As at 23 July2006, beingthe 2-year

period priorto the

AnnouncementDate

As at 21 July2008, beingthe tradingday prior to

theAnnouncement

Date

Closingprice asat theLatest

PracticableDate

% changefrom

23 July2006 to21 July

2008

% changefrom

23 July2006 to

the LatestPracticable

Date

% changefrom

21 July2008 to

the LatestPracticable

Date

Closing price ofDatacraft Shares(US$)

1.01 0.99 1.28 (2%) 27% 29%

STI 2,337.79 2,919.21 2,486.55 25% 6% (15%)

(Source: Bloomberg & PwCCF analysis)

Based on the above, we note the following:

(a) From 23 July 2006 to 21 July 2008, being the trading day prior to theAnnouncement Date, Datacraft’s share price has declined by 2%, while the STIhas appreciated by 25% over the same period; and

(b) From 21 July 2008, being the trading day prior to the Announcement Date to theLatest Practicable Date, Datacraft’s share price has appreciated by 29%, whilethe STI has declined by 15%.

Based on the above observations, we note that the market price of Datacraft Shareshas been trending upwards since the Announcement Date leading up to the LatestPracticable Date as compared to the 2-year period prior the Announcement Date.

Thus, it appears that the market price of the Shares as at the Latest Practicable Dateis mainly influenced by and supported by, inter alia, the Scheme. However, there is noassurance that the price of the Shares and/or trading liquidity of the Shares will remainat their current levels if the Scheme does not become effective.

7.2 Comparison with successful privatisation/delisting transactions for companies listed onthe Mainboard of the SGX-ST

In assessing the reasonableness of the Cash Consideration, we have compared the financialterms of those successful privatisation/delisting transactions for companies listed on theMainboard of the SGX-ST which were announced and completed since 23 July 2006, being the2-year period prior to the Announcement Date and up to the Latest Practicable Date (the“Comparable Privatisation Transactions”). We have excluded from our analysis thoseprivatisation transactions which were announced but were not successful.

This analysis serves as a general indication of the relevant premium/discount that the offerorshave paid in order to acquire the target companies without having regard to their specific industrycharacteristics or other considerations.

However, we highlight that the companies set out under the Comparable PrivatisationTransactions are not directly comparable to Datacraft in terms of size of operations, marketcapitalisation, type and composition of business activities, asset base, geographical spread,track record, financial performance, operating and financial leverage, risk profile, liquidity, futureprospects and other relevant criteria. Each of the Comparable Privatisation Transactions mustbe considered on its own commercial and financial merits.


53

The details of the Comparable Privatisation Transactions based on chronological order are asfollows:

Premium of the offer price to

CompanyDate of

announcementOffer Price

(S$)

1-monthVWAP prior

to offerannouncement

(%)

3-monthVWAP prior


(%)

GES International Ltd 26 July 2006 1.25 19.1 22.6

Brilliant Manufacturing Ltd(1) 29 November 2006 0.418 24.4 37.2

First Engineering Ltd(2) 8 December 2006 1.00 23.0 22.3

Roly International Ltd 12 December 2006 0.35 19.7 27.5

Landwind Medical Holdings Ltd 12 January 2007 0.58 62.4 45.8

MMI Holdings Ltd(3) 5 April 2007 1.65 31.2 50.1

Amtek Engineering Ltd(4) 22 May 2007 1.10 50.7 59.4

Pan-United Marine Ltd 28 May 2007 2.38 14.4 21.7

Sembawang Kimtrans Ltd(5) 13 June 2007 0.80 13.9 15.1

United Test and AssemblyCentre Ltd(6)

26 June 2007 1.20 30.8 32.7

Labroy Marine Ltd 29 October 2007 2.84 9.2 19.8

Permasteelisa Pacific HoldingsLtd

16 November 2007 0.44 20.2 23.2

Frontline TechnologiesCorporation Ltd

5 December 2007 0.245 29.6 34.6

Sincere Watch Ltd(7) 7 December 2007 2.564 19.3 30.2

The Ascott Group Ltd 8 January 2008 1.73 39.5 19.3

Robinson and Company Ltd(8) 20 January 2008 7.20 64.4 60.4

Sing Lun Holdings Ltd(9) 30 March 2008 0.46 42.3 57.8

Transmarco Ltd 8 April 2008 1.02 40.8 38.8

Unisteel Technology Ltd(10) 7 June 2008 1.95 44.6 41.1

SNP Corporation Ltd(11) 10 June 2008 1.76 39.6 47.1

Pokka Corporation (Singapore)Ltd

13 June 2008 0.66 30.6 37.2

High 64.4 60.4

Low 9.2 15.1

Median 30.6 34.6

Average 31.9 35.4

Datacraft 22 July 2008 US$1.33 30.4 33.0

(Source: Bloomberg, SGX-ST announcements, offer document, scheme document and circular of each respectivecompany in relation to the Comparable Privatisation Transactions)


54

In addition to the above, we have further compared the premium implied in the CashConsideration against the Comparable Privatisation Transactions where the offeror already hasa controlling stake in the company as at the offer announcement date (the “ComparablePrivatisation Transactions by Controlling Shareholder”).

The details of the Comparable Privatisation Transactions by Controlling Shareholder based onchronological order are as follows:

Premium of the offer price to

CompanyDate of

announcementOffer Price

(S$)

1-monthVWAP prior


(%)

3-monthVWAP prior


(%)

First Engineering Ltd(2) 8 December 2006 1.00 23.0 22.3

Roly International Ltd 12 December 2006 0.35 19.7 27.5

Permasteelisa Pacific HoldingsLtd

16 November 2007 0.44 20.2 23.2

The Ascott Group Ltd 8 January 2008 1.73 39.5 19.3

Transmarco Ltd 8 April 2008 1.02 40.8 38.8

Pokka Corporation (Singapore)Ltd

13 June 2008 0.66 30.6 37.2

High 40.8 38.8

Low 19.7 19.3

Median 26.8 25.4

Average 29.0 28.1

Datacraft 22 July 2008 US$1.33 30.4 33.0

(Source: Bloomberg, SGX-ST announcements, offer document, scheme document and circular of each respectivecompany in relation to the Comparable Privatisation Transactions by Controlling Shareholder)

Notes:

(1) On 14 November 2006, Brilliant Manufacturing Ltd announced that it had been approached by a third party, whowas interested to consider a possible offer for the shares. On 29 November 2006, the voluntary cash offer wasannounced. The market premia in the table above, as extracted from the company’s circular, were computed basedon prices prior to the announcement on 14 November 2006.

(2) The offeror has been the single largest shareholder of the company with approximately 28.1% stake prior to theoffer announcement date.

(3) On 9 February 2007, MMI Holdings Ltd announced that it had received expressions of interest in relation to apossible transaction involving its shares which may or may not lead to an offer. On 5 April 2007, the scheme ofarrangement was announced. The market premia in the table above, as extracted from the company’s schemedocument, were computed based on prices prior to the announcement on 9 February 2007.

(4) Prior to the offer announcement on 22 May 2007, Amtek Engineering Ltd had on 16 April 2007 releasedannouncement that certain shareholders have been approached in relation to possible transactions involving theirshares, which may or may not lead to an offer for the company. The market premia in the table above, as extractedfrom the relevant offer document, were computed based on prices prior to the announcement on 16 April 2007.


55

(5) In respect of Sembawang Kimtrans Ltd, the offer price was S$0.70 for each share and in the event that the offerorwas entitled to exercise its right of compulsory acquisition, the offer price would be S$0.80 for each share. Themarket premia in the table above, as extracted from the company’s circular, were based on the offer price of S$0.80for each share as the offeror had successfully exercised its right of compulsory acquisition.

(6) On 4 June 2007, a research report was published on Bloomberg stating that there was significant interest in UnitedTest and Assembly Center Ltd as a buy-out candidate during an investors’ presentation in the United States. Themarket premia in the table above, as extracted from the company’s scheme document, were computed based onprices prior to the publication of the said report on 4 June 2007.

(7) On 7 December 2007, a pre-conditional voluntary conditional offer for Sincere Watch Ltd (“Sincere”) wasannounced. The offer price for each share in Sincere was S$2.051 in cash and 0.228 new share in the capital ofPeace Mark Holdings Limited (a company listed on the Hong Kong Stock Exchange (“HKSE”)) at the issue priceof HKS$12.096 each, equivalent to a total notional value of S$2.564. The market premia in the table above werebased on such notional value and over the relevant periods prior to the pre-conditional offer announcement on 7December 2007.

At the close of the offer on 18 March 2008, as a result of acceptances of the offer, the public float in Sincere hadfallen below 10% and consequently, its shares were suspended since 19 March 2008. The offeror had then statedthat it intended to preserve the listing status of Sincere and would take steps to restore the public float. However,on 27 March 2008, the offeror announced on the HKSE that it had changed its intention and would seek the SIC’sconsent for compulsory acquisition of Sincere. On 28 April 2008, the offeror announced on the HKSE that SIC hadrejected its application. However, on 5 August 2008, the company announced that it has sought the approval of theSGX-ST for the de-listing of the company from SGX-ST.

(8) On 20 January 2008, the offeror announced that it intended to make a voluntary conditional cash offer for the sharesin the capital of Robinson and Company Ltd at a price of S$6.25 for each share. Subsequently, the offeror increasedthe offer price to S$7.00 for each share on 17 March 2008 and to S$7.20 for each share on 3 April 2008. The marketpremia in the table above, as extracted from the company’s circular, were computed based on the final offer priceof S$7.20 for each share and market prices prior to the first offer announcement on 20 January 2008.

(9) On 24 March 2008, Sing Lun Holdings Ltd announced that it had been informed that certain parties were engagedin discussions to consider making a general offeror for the shares in the company. On 30 March 2008, the voluntaryconditional cash offer was announced. The market premia in the table above, as extracted from the company’scircular, were computed based on prices prior to the announcement on 24 March 2008.

(10) On 15 April 2008, Unisteel Technology Ltd (“Unisteel”) received a query by the SGX-ST regarding a substantialincrease in its share price. On 16 April 2008, Unisteel responded to the query by SGX-ST and announced thatUnisteel was reviewing strategic options available to the company. On 7 June 2008, the scheme of arrangementwas announced. The market premia, in the table above, as extracted from the company’s scheme document, werecomputed based on prices on 14 April 2008, being the last trading day prior to the query by SGX-ST.

(11) On 18 April 2008, SNP Corporation Limited announced that it had been informed by its major shareholder, GreenDot Capital Pte Ltd that it is evaluating options with respect to its stake in the company. On 10 June 2008, thevoluntary cash offer was announced. The market premia in the table above, as extracted from the company’scircular, were computed based on prices prior to the announcement on 18 April 2008.

In relation to the Comparable Privatisation Transactions, we note that:

(a) the premium implied in the Cash Consideration for the 1-month VWAP prior to theAnnouncement Date is within the range, but is less favourable compared to the median andaverage 1-month VWAP of the Comparable Privatisation Transactions; and

(b) the premium implied in the Cash Consideration for the 3-month VWAP prior to theAnnouncement Date is within the range but is less favourable compared to the median andaverage 3-month VWAP of the Comparable Privatisation Transactions.


56

In relation to the Comparable Privatisation by Controlling Shareholder, we note that:

(a) the premium implied in the Cash Consideration for the 1-month VWAP prior to theAnnouncement Date is within the range and is more favourable compared to the medianand average 1-month VWAP of the Comparable Privatisation Transactions by ControllingShareholder; and

(b) the premium implied in the Cash Consideration for the 3-month VWAP prior to theAnnouncement Date is within the range and is more favourable compared to the medianand average 3-month VWAP of the Comparable Privatisation Transactions by ControllingShareholder.

The level of premium (if any) an offeror would normally pay in any particular privatisationtransaction depends on, inter alia, factors such as potential synergy that the offeror can gain byacquiring the target, the availability of substantial cash reserves, the liquidity in the trading of thetarget company’s shares, the presence of competing bids for the target, prevailing marketconditions and sentiments, attractiveness and profile of the target’s business and assets, size ofconsideration and existing and desired level of control in the target. Consequently, eachComparable Privatisation Transactions has to be judged on its own merits.

The analysis above is based on data compiled from publicly available sources and serves onlyas an illustrative guide as to the premium/discount in connection with privatisation of companieslisted on the SGX-ST.

7.3 Comparison of the implied valuation ratios of Datacraft against listed companies broadlycomparable to Datacraft

For the purpose of assessing the Cash Consideration, we have compared the valuation ratios ofDatacraft implied in the Cash Consideration with those of selected comparable companies listedwithin Asia Pacific with market capitalisation between US$ 100 million and US$ 1 billion that areinvolved in information technology services which we consider to be broadly comparable toDatacraft (the “Comparable Companies”). In arriving at the Comparable Companies, we havealso taken into consideration comparable companies that are selected by research analysts thatcover Datacraft.

We, however, recognise that the Comparable Companies listed herewith are not exhaustive andthat there is no company listed on the relevant stock exchanges which may be considered to beidentical to Datacraft in terms of composition of business activities, scale of operations,geographical spread of activities, track record, financial performance, future prospects, assetbase, risk profile and other relevant criteria. Accordingly, any comparisons made with respect tothe Comparable Companies can only serve as an illustrative guide.


57

A brief description of the Comparable Companies is as set out below:

ComparableCompanies

StockExchange Description

EnterpriseValue(1)

(US$ million)

MarketCapitalisation(1)

(US$ million)Revenue(2)

(US$ million)

SingaporeComputerSystems Ltd(“SCS”)

Singapore SCS provides services ITservices. The companyprovides IT consulting,systems integration,outsourcing, networking,electronic commerce,and enterprise systems.SCS also providessystem development,project implementation,facilities management,system support andsoftware developmentservices

134.0 163.9 316.4

CSE Global Ltd(“CSE”)

Singapore CSE provides systemsintegration andinformation technologysolutions, computernetwork systems, andindustrial automation.The company alsodesigns, manufactures,and installs managementinformation systems.CSE develops,manufacture and sellselectronic and microprocessor monitoringequipment

369.0 324.4 282.4

NET OneSystems Co.Ltd (“Net One”)

Japan Net One designs,installs, maintains, andsells computer networksystems for local areanetwork and automaticteller machine. Thecompany also sellsnetwork-related productssuch as switches, router,and software. Net Oneprovides consultation,cable installation, andengineering services fornetwork systems as well

481.1 733.9 1,055.6


58

ComparableCompanies


EnterpriseValue(1)

(US$ million)



(US$ million)

Hitachi Systems& Services Ltd(“HitachiSystems”)

Japan Hitachi Systems providescomputer systemintegration and itsmaintenance services forfinancial andmanufacturing industries.The company alsodevelops and sellspackaged software

377.8 384.9 1,241.0

MatsushitaElectric WorksInformationSystemsCo., Ltd(“MatsushitaInformation”)

Japan Matsushita Informationmainly provides systemservices and solutions.The company also plans,develops, sells, andleases computersoftware and packagedsoftware. MatsushitaInformation providesinformation networkservices as well as sellscommunication networkrelated equipment

184.1 191.2 369.2

VADS Bhd(“VADS”)

Malaysia VADS providesinternational and nationalmanaged networkservices for businessesand organizations.Through its subsidiaries,the company alsoprovides managede-services, managedapplication services, andsystem integrationservices

190.7 225.7 151.8

Digital ChinaHoldings Ltd(“DigitalChina”)

HongKong

Digital China through itssubsidiaries, distributesforeign brand informationtechnology products andprovides systemintegration service inChina. The companyalso develops anddistributes networkingproducts

403.8 327.6 4,521.9


59

ComparableCompanies


EnterpriseValue(1)

(US$ million)



(US$ million)

InfotechEnterprises Ltd(“Infotech”)

India Infotech operates as atotal software solutionsprovider. The groupoffers services in theareas of CAD/GIS,technical and businesssoftware, and indeveloping Intranet andInternet fields. The groupsupplies its services tothe global markets,including those of NorthAmerica, Asia Pacific,Europe and India

218.2 254.5 146.6

3i Infotech Ltd(“3i Infotech”)

India 3i Infotech provides arange of informationtechnology solutions tocompanies worldwide.The company primarilyserves companies in thebanking, insurance, andfinancial servicesindustries. The companyalso provides businessprocess outsourcing ande-Governance solutions

527.3 283.7 262.2

HCL InfosystemsLtd (“HCL”)

India HCL manufacturescomputer systems andspecializes in theprovision of IT solutionsand related services. Thecompany provides avariety of services,including IT consultancy,software development,system integration, SAPconsultancy, systemsupport, networkimplementation andfacilities management

323.2 373.9 2,741.8

(Source: Bloomberg as at Latest Practicable Date)

Notes:

(1) The market capitalisation and enterprise value of the respective Comparable Companies as at the LatestPracticable Date (Source: Bloomberg).

(2) The revenue of the respective Comparable Companies is based on the latest available audited financial statementsor Bloomberg of the respective Comparable Companies, as relevant.

(3) Where applicable, the market capitalisation, enterprise value and revenue of the respective ComparableCompanies have been converted to US$ at the relevant spot exchange rate as at the Latest Practicable Date(Source: Bloomberg).


60

In our evaluation, we have considered the following widely used valuation parameters:

Valuation parameters Description

EV/EBITDA “EV” or “Enterprise Value” is the sum of a company’s marketcapitalisation, minority interests, short-term and long-term debt lesscash and cash equivalents. “EBITDA” stands for historical earningsbefore interest, tax, depreciation and amortisation expenses.

P/E A “P/E” or “price-to-earnings” ratio illustrates the ratio of the marketcapitalisation relative to its profit after tax attributable to theshareholders (the “PATMI”). The P/E ratio is affected by, inter alia,the capital structure of a company, its cash holding, its tax positionas well as its accounting policies relating to depreciation andintangible assets.

P/NTA “P/NTA” or “price-to-NTA” ratio illustrates the ratio of the marketcapitalisation of a company relative to its audited historical book nettangible asset (the “NTA”). The P/NTA ratio is affected bydifferences in their respective accounting policies including theirdepreciation and asset valuation policies.

For illustrative purposes only, the table below sets out the valuation ratios for the ComparableCompanies:

Comparable CompaniesFinancial

year ended

HistoricalEV/EBITDA(1)

(times)

HistoricalP/E(2)

(times)P/NTA(3)

(times)

SCS December 07 5.3 13.3 1.7

CSE(4) December 07 8.0 11.1 6.5

Net One March 08 6.8 31.3 1.4

Hitachi Systems March 08 3.8 8.0 1.3

Matsushita Information March 08 3.5 7.1 1.3

VADS December 07 8.5 14.4 4.1

Digital China March 08 4.3 6.4 0.9

Infotech March 08 6.9 13.7 1.7

3i Infotech March 08 9.3 7.4 1.6

HCL June 08 3.0 5.7 1.7

High 9.3 31.3 6.5

Low 3.0 5.7 0.9

Median 6.1 9.6 1.7

Average 5.9 11.8 2.2

Average – Singapore listedcompanies only

6.7 12.2 4.1


61

Comparable CompaniesFinancial

year ended

HistoricalEV/EBITDA(1)

(times)

HistoricalP/E(2)

(times)P/NTA(3)

(times)

Datacraft(5) September 07 10.0 20.3 2.9

Datacraft – Adjusted P/E September 07 – 17.1(6) –

(Source: Bloomberg as at Latest Practicable Date)

Notes:

(1) The EBITDA of the Comparable Companies is based on the latest available audited financial statements of therespective Comparable Companies or Bloomberg, as relevant.

(2) The PATMI of the Comparable Companies is based on the latest available audited financial statements of therespective Comparable Companies or Bloomberg, as relevant.

(3) The NTA of the Comparable Companies is based on the latest available financial results of the respectiveComparable Companies or Bloomberg as at the Latest Practicable Date, as relevant.

(4) As at 25 August 2008, Computer Systems Holdings Pte Ltd (“Computer Systems”) announced that it had acquiredapproximately 60% stake in SCS from Green Dot Capital Pte Ltd. As a result of the transaction, Computer Systemsis required by the Code to make a mandatory offer for all the shares in SCS other than those already owned,controlled or agreed to be acquired. As at the Latest Practicable Date, the transaction has not been completed.

(5) The market capitalisation of Datacraft is based on the implied Cash Consideration (the “Implied MarketCapitalisation”). The EV of Datacraft is based on its Implied Market Capitalisation and the net debt and minorityinterests figures as set out in their latest available financial results as at the Latest Practicable Date.

(6) Based on the latest available announced results as at 30 June 2008, Datacraft has a cash balance of approximatelyUS$167.5 million. This cash amount is offset against the Implied Market Capitalisation of Datacraft (the “AdjustedImplied Market Capitalisation”) and correspondingly, the PATMI of Datacraft is reduced by the interest income ofapproximately US$4.1 million for the FYE 30 September 2007 (the “Adjusted PATMI”). The Adjusted ImpliedMarket Capitalisation over the Adjusted PATMI of Datacraft is hereafter referred to as Adjusted P/E.

(7) Where applicable, the market capitalisation and enterprise value of the respective Comparable Companies havebeen converted to US$ at the relevant spot exchange rate as at the Latest Practicable Date (Source: Bloomberg).

From the table above, we note the following:

(a) the EV/EBITDA ratio implied in the Cash Consideration is above the range of theEV/EBITDA ratios of the Comparable Companies;

(b) the P/E ratio and Adjusted P/E ratio implied in the Cash Consideration are within the rangeand are more favourable compared to the median and average P/E ratios of theComparable Companies; and

(c) the P/NTA ratio implied in the Cash Consideration is within the range and is morefavourable compared to the median and average P/NTA ratios of the ComparableCompanies.

7.4 Comparison of the implied transaction multiples of Datacraft against acquisitiontransactions in the information technology services sector

We have also compared the implied transaction multiplies of Datacraft with those completedacquisition transactions in the IT services sector with deal value of approximately US$100 millionwithin the Asia Pacific region since 23 July 2006, being the 2-year period prior to theAnnouncement Date and up to the Latest Practicable Date (the “Comparable Transactions”).


62

A summary of the relevant financial terms of the Comparable Transactions is set out below. Wehighlight that the target companies in the Comparable Transactions set out in the analysis arenot directly comparable with the Company in terms of size of operations, market capitalization,business activities, clientele base, asset base, geographical spread, track record, accountingpolicy, financial performance, operating and financial leverage, future prospects and otherrelevant criteria. The list below is by no means exhaustive and is for illustration purposes only.

Date Announced TargetCountry ofthe Target Acquirer

HistoricalEV/EBITDA

(times)

HistoricalP/E

(times)P/NTA(times)

Premium/(discount) of

the offer priceto the 1-monthVWAP prior toannouncement

date

17 May 2007 ComputerSystems Adviser

(M) Bhd

Malaysia ComputerSciences

Corporation

4.5 13.6 1.7 34.5%

20 July 2007 Data SystemsConsulting Co

Ltd

Taiwan Ding HwaInvestment

18.7 18.9 3.1 22.2%

25 October 2007 Digital China China SparklingInvestment

Ltd

7.9 14.8 1.7 (3.1%)(1)

8 August 2007 ECS HoldingsLtd

Singapore VSTHoldingsLimited

10.7 11.3 1.3 18.2%(2)

5 December 2007 FrontlineTechnologies

Corporation Ltd

Singapore BTSingapore

Pte Ltd

10.8 21.8 2.4 29.6%

High 18.7 21.8 3.1 34.5%

Low 4.5 11.3 1.3 (3.1%)

Median 10.7 14.8 1.7 22.2%

Average 10.5 16.1 2.0 20.3%

22 July 2008 Datacraft Singapore DimensionData

10.0 20.3 2.9 30.4%

22 July 2008 Datacraft –Adjusted P/E

Singapore DimensionData

– 17.1(3) – –

(Source: mergermarket, Bloomberg and circular/announcements of the respective target companies

Note:

(1) The market premium in the table above, as extracted from the company’s circular, was computed based on pricesprior to 2 August 2007, being the date of trading suspension of the company’s shares. The company’s shares weresuspended from trading as it was awaiting for the release of the announcement related to the abovementionedtransaction.

(2) On 28 May 2007, ECS Holdings Ltd announced to its shareholders that a third party had approached certainsubstantial shareholders of the company regarding a possible transaction involving their shares in the company,which may or may not lead to an offer for the company. The market premium in the table above, as extracted fromthe company’s circular, was computed based on prices prior to the announcement on 28 May 2007.

(3) Based on the latest available announced results as at 30 June 2008, Datacraft has a cash balance of approximatelyUS$167.5 million. This cash amount is offset against the Implied Market Capitalisation of Datacraft (the “AdjustedImplied Market Capitalisation”) and correspondingly, the PATMI of Datacraft is reduced by the interest income ofapproximately US$4.1 million for the FYE 30 September 2007 (the “Adjusted PATMI”). The Adjusted P/E is basedon the Adjusted Implied Market Capitalisation over the Adjusted PATMI of Datacraft for the FYE 30 September2007.


63

Based on the table above, we note the following:

(a) the EV/EBITDA ratio implied in the Cash Consideration is within the range but is lessfavourable compared to the median and average EV/EBITDA ratios of the ComparableTransactions in the IT sector;

(b) the P/E ratio and Adjusted P/E ratio implied in the Cash Consideration are within the rangeand are more favourable compared to the median and average P/E ratios of theComparable Transactions in the IT sector;

(c) the P/NTA ratio implied in the Cash Consideration is within the range and is morefavourable compared to the median and average P/NTA ratios of the ComparableTransactions in the IT sector; and

(d) the premium of the Cash Consideration over the 1-month VWAP prior to the AnnouncementDate is within the range and is more favourable compared to the median and average1-month VWAP of the Comparable Transactions in the IT sector.

7.5 Other considerations

7.5.1 The Scheme is binding on the Scheme Shareholders

If the Scheme is approved by a majority in number of the Scheme Shareholderspresent and voting, either in person or by proxy, at Court Meeting, such majorityholding not less than 75% in value of the Scheme Shares held by the SchemeShareholders present and voting at the Court Meeting, the Scheme will be binding onall Scheme Shareholders, regardless of whether they were present in person or byproxy or voted at the Court Meeting.

7.5.2 Other conditions of the Scheme

Scheme Shareholders should note that besides the requisite approval of SchemeShareholders at the Court Meeting, the Scheme is also subject to, inter alia, thefulfillment of certain conditions precedent and termination provisions. In the event thatsuch conditions precedent are not fulfilled or waived or the termination provisionsbecome applicable, the Scheme may not proceed. There is no assurance as at theLatest Practicable Date that the Scheme will become effective.

7.5.3 Alternative Offers

As at the Latest Practicable Date, there is no publicly available evidence of anyalternative offer for the Shares. Further, the Directors have also confirmed that as atthe Latest Practicable Date, apart from the Scheme, they have not received any otheroffer from any other party.

7.6 OTHER INFORMATION

7.6.1 Analysts’ estimates of price targets for the Shares

There were a total of 5 financial institutions which have issued investment researchreports on the Company between 14 May 2008, being the date of the announcementof the Company’s first half financial results for the FPE 31 March 2008 up to theAnnouncement Date.


64

We set out below a summary of the price targets for the Shares set out in these reports.

Name of financial institutionTarget price

(US$) Date of report

Citigroup 1.50 22 July 2008

Nomura Singapore 1.25 22 July 2008

Credit Suisse 1.36 9 June 2008

JPMorgan 1.56 21 May 2008

Deutsche Bank 1.40 14 May 2008

High 1.56

Low 1.25

Average 1.41

Cash Consideration 1.33

(Source: Thomson Financials and Bloomberg)

Based on the above, the Cash Consideration is within the range but below the averagetarget price of US$1.41 by approximately 5.7%.

We highlight that the aforementioned price targets for the Shares reflect theindependent earnings estimates of the respective analysts based on their futureoutlook (including market conditions and economic outlook) as at the date ofpublication. The analysts’ views and/or price targets may change materially as a resultof, amongst others, changes in general market conditions, the Company’s corporatedevelopments, macro-economic conditions and emergence of new developments orinformation relevant to the Company and/or its industry. Scheme Shareholders shouldnote that the information above should not be relied upon as a promise or indication ofthe actual future market prices of the Shares.

8. CONCLUSION AND RECOMMENDATION

We have taken into account a range of factors we deemed necessary and balanced them beforereaching our conclusion and recommendation. Accordingly, it is important that our letter, inparticular, all the considerations and information we have taken into account, be read in itsentirety.

Our opinion is solely based on information available as at the date of this report. The principalfactors that we have taken into account in forming our opinion are summarised below:

(a) the Cash Consideration represents a premium of 22.0%, 23.1%, 34.3%, 33.0%, 30.4% and34.3% over the VWAP of the Shares for the 2-year period, 1-year period, 6-month period,3-month period, 1-month period and on the Last Trading Day on which the Shares weretraded prior to the Announcement Date;

(b) during the last 2-year period and 1-year period prior to the Announcement Date, theaverage daily trading volumes for the Shares were 971,202 and 609,135 representingapproximately 0.5% and 0.3% of the Public Float respectively. Further, during the 6-monthperiod, 3-month period and 1-month period prior to the Announcement Date, the averagetrading volume for the Shares were 488,298, 366,097 and 140,810 representingapproximately 0.2%, 0.2% and 0.1% of the Public Float respectively. This demonstrates ageneral decline in the trading activity of the Shares in the last 2-year period prior to theAnnouncement Date;


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(c) the market price of the Shares has generally underperformed against the STI for the 2-yearperiod prior to the Announcement Date. However, based on our observations set out inSection 7.1.2 of our letter, we note that the market price of Datacraft Shares has beentrending upwards since the Announcement Date leading up to the Latest Practicable Date.This appears to be mainly influenced by and supported by, inter alia, the Scheme. Thereis no assurance that the price of the Shares and/or trading liquidity of the Shares willremain at their current levels if the Scheme does not become effective;

(d) the premium implied in the Cash Consideration of 30.4% over the 1-month VWAP prior tothe Announcement Date is within the range, but is less favourable compared to the medianand average 1-month VWAP of 30.6% and 31.9% of the Comparable PrivatisationTransactions;

(e) the premium implied in the Cash Consideration of 33.0% over the 3-month VWAP prior tothe Announcement Date is within the range but is less favourable compared to the medianand average 3-month VWAP of 34.6% and 35.4% respectively of the ComparablePrivatisation Transactions;

(f) the premium implied in the Cash Consideration of 30.4% over the 1-month VWAP prior tothe Announcement Date is within the range and is more favourable compared to themedian and average 1-month VWAP of 26.8% and 29.0% respectively of the ComparablePrivatisation Transactions by Controlling Shareholder;

(g) the premium implied in the Cash Consideration of 33.0% over the 3-month VWAP prior tothe Announcement Date is within the range and is more favourable compared to themedian and average 3-month VWAP of 25.4% and 28.1% respectively of the ComparablePrivatisation Transactions by Controlling Shareholder;

(h) the EV/EBITDA ratio implied in the Cash Consideration of 10.0x is above the range of theEV/EBITDA ratios of the Comparable Companies of 3.0x to 9.3x;

(i) the P/E and Adjusted P/E ratios implied in the Cash Consideration of 20.3x and 17.1x arewithin the range and are more favourable compared to the median and average P/E ratiosof the Comparable Companies of 9.6x and 11.8x respectively;

(j) the P/NTA ratio implied in the Cash Consideration of 2.9x is within the range and is morefavourable compared to the median and average P/NTA ratios of the ComparableCompanies of 1.7x and 2.2x respectively;

(k) the EV/EBITDA ratio implied in the Cash Consideration of 10.0x is within the range but isless favourable compared to the median and average EV/EBITDA ratios of the ComparableTransactions in the IT sector of 10.7x and 10.5x respectively;

(l) the P/E and Adjusted P/E ratios implied in the Cash Consideration of 20.3x and 17.1x arewithin the range and are more favourable compared to the median and average P/E ratiosof the Comparable Transactions in the IT sector of 14.8x and 16.1x respectively;

(m) the P/NTA ratio implied in the Cash Consideration of 2.9x is within the range and is morefavourable compared to the median and average P/NTA ratios of the ComparableTransactions in the IT sector of 1.7x and 2.0x respectively;

(n) the premium of the Cash Consideration of 30.4% over the 1-month VWAP prior to theAnnouncement Date is within the range and is more favourable compared to the medianand average 1-month VWAP of the Comparable Transactions in the IT sector of 22.2% and20.3% respectively; and


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(o) As at the Latest Practicable Date, there is no publicly available evidence of any alternativeoffer for the Shares. Further, the Directors have also confirmed that as at the LatestPracticable Date, apart from the Scheme, they have not received any other offer from anyother party.

Having carefully considered the financial analysis and subject to the assumptions andqualifications made herein, we are of the opinion that, on balance, the financial terms ofthe Scheme are fair and reasonable and are not prejudicial to the interests of the SchemeShareholders under current market conditions as at the Latest Practicable Date.

In rendering our opinion, we have not taken into consideration the specific investment objectives,financial situation, tax position or particular needs and constraints of any individual SchemeShareholder. As each Scheme Shareholder would have different objectives and profiles, werecommend that any individual Scheme Shareholder who may require specific advice in relationto his investment objectives or portfolio should consult his stockbroker, bank manager, solicitor,accountant, tax adviser or other professional adviser immediately.

Scheme Shareholders should note that trading of the Shares is subject to, inter alia, theperformance and prospects of the Datacraft Group, prevailing economic conditions, economicoutlook and stock market conditions and sentiments. Accordingly, our advice on the Schemedoes not and cannot take into account the future trading activities or patterns or price levels thatmay be established beyond the Latest Practicable Date.

Our opinion letter is addressed to the Independent Directors for their benefit in connection withand for the purpose of their consideration of the Scheme and should not be relied upon by anyother party. The recommendation made by them to the Scheme Shareholders in relation to theScheme remains the responsibility of the Independent Directors.

Whilst a copy of this letter may be reproduced in the Scheme Document, neither the Companynor the Directors may reproduce, disseminate or quote this letter (or any part thereof) for anyother purpose at any time and in any manner without the prior written consent of PwCCF in eachspecific case.

This letter is governed by, and construed in accordance, with the laws of Singapore, and isstrictly limited to the matters stated herein and does not apply by implication to any other matter.Nothing herein shall confer or be deemed or is intended to confer any rights of benefits to anythird party and the Contracts (Rights of Third Parties) Act 2001 and any re-enactment thereofshall not apply.

Yours faithfullyFor and on behalf ofPricewaterhouseCoopers Corporate Finance Pte Ltd

Kan Yut KeongManaging Director

Jolly TanAssociate Director


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22 September 2008

To: The Shareholders of Datacraft Asia Ltd

Dear Sir/Madam

PROPOSED SCHEME OF ARRANGEMENT UNDER SECTION 210 OF THE COMPANIES ACT,CHAPTER 50 OF SINGAPORE TO PRIVATISE DATACRAFT ASIA LTD

1. INTRODUCTION

1.1 Joint Announcement. On 22 July 2008, the directors of Dimension Data and Datacraft jointlyannounced (the “Joint Announcement”) the proposed privatisation of Datacraft by way of ascheme of arrangement (the “Scheme”) under Section 210 of the Companies Act and inaccordance with the Code, which will involve the following:

(a) a transfer of all issued Shares held by Scheme Shareholders to Dimension Data and/or itsnominees; and

(b) in consideration of the transfer of their issued Shares, Scheme Shareholders will receive anaggregate of US$1.33 in cash (the “Cash Consideration”) for each Share transferred,consisting of:

(i) a payment of US$1.09 in cash (the “Scheme Price”) from Dimension Data for eachissued Share transferred; and

(ii) a capital distribution by Datacraft of US$0.24 in cash for each issued Share (the“Capital Distribution”) to all Scheme Shareholders as at the Books Closure Date.

For the avoidance of doubt, Dimension Data, its related corporations and their respectivenominees (the “Excluded Shareholders”) will not be entitled to the Scheme Price and/orthe Capital Distribution.

A copy of the Joint Announcement is available on the website of the SGX-ST at www.sgx.com.

The Scheme is subject to conditions precedent which must be satisfied or waived (as applicable)for the Scheme to be implemented. Details of these conditions precedent are set out in paragraph5 of the Explanatory Statement in the Document.

The terms of the Scheme are more particularly described in paragraph 3 of Datacraft’s Letter toShareholders in the Document. Annex 1 of this letter (this “Letter”) from Dimension Data sets outthe terms and conditions of the Options Proposal (as defined below).

1.2 Effect of Scheme and Delisting. If the Scheme becomes effective, Dimension Data will own theentire issued share capital of Datacraft. An application has been made to the SGX-ST to seekconfirmation from the SGX-ST to delist Datacraft from the SGX-ST upon the Scheme becoming

APPENDIX 2: LETTER FROM DIMENSION DATATO THE SCHEME SHAREHOLDERS

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effective and binding, and in connection therewith, the SGX-ST has confirmed that, inter alia,subject to the Scheme being approved by Scheme Shareholders and the Court, it has noobjection to the proposed delisting of Datacraft from the Official List of the SGX-ST. The SGX-ST’sconfirmation, however, is not an indication of the merits of Datacraft, its subsidiaries, the Schemeor the proposed withdrawal of the Datacraft Shares from the Official List of the SGX-ST.

1.3 Capitalised Terms. Capitalised terms used in this Letter have the same meaning andconstruction as those defined in the Document, unless otherwise indicated.

2. RATIONALE FOR THE SCHEME

2.1 Strengthen Datacraft’s position in the market. Dimension Data has held a majority stake inDatacraft since 1997, during which time there has been an increasing alignment of their strategicand operating models of both companies. Dimension Data continues to pursue its strategy ofdriving profitable growth from its global presence and believes that it would gain increasedexposure to attractive growth markets through full ownership of one of the leading informationtechnology services and solutions providers in Asia-Pacific.

Dimension Data believes that Datacraft’s leadership position in Asian markets will bestrengthened by bringing it fully within the Dimension Data Group, offering it the opportunity toleverage more effectively the resources of the wider group and capitalise on opportunities in themarket. Dimension Data believes that, if privatised, Datacraft’s management will be able to reactfaster with greater flexibility to available opportunities internationally and accelerate its growth inkey markets.

2.2 Reduced costs and improved efficiency. As a listed entity, Datacraft has to incur listing,compliance and other related costs associated with continuing listing requirements under theListing Manual. If privatised, efficiencies would result from greater sharing of services andresources with Dimension Data’s other strategic business units. In particular, Dimension Data andDatacraft would be better able to freely transfer intellectual property, share best practices andensure unfettered staff mobility within the enlarged group. Similarly, Dimension Data andDatacraft will be able to fully align their businesses to increase operational efficiencies.Management of group-wide cashflows and capital structure would also be significantly improved.

2.3 Public listing no longer beneficial. Datacraft’s public listing no longer serves a material purposeas Datacraft has not raised any funds from the capital markets since the year 2000 and there isno foreseeable requirement to do so. Further, since being excluded from the MSCI SingaporeIndex in mid-2006, Datacraft has experienced a reduced level in the trading of Datacraft Shares,with average daily traded volume over the last 12 months down approximately 92 per cent. on theaverage daily traded volume in the three years prior to June 2006. The low trading liquidity of theDatacraft Shares limits the purpose of its public listing and reduces the effectiveness of itsemployee incentive schemes.

2.4 Attractive premium to share price. The Scheme provides an opportunity for SchemeShareholders to realise their investment in Datacraft for cash at an attractive premium to recentmarket prices. The aggregate Cash Consideration (including the Capital Distribution) representsa 33.0 per cent. premium over the volume weighted average of transacted prices of the DatacraftShares on the SGX-ST of US$1.00 over the last three months prior to the date of the JointAnnouncement.


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3. FUTURE PLANS FOR DATACRAFT

Dimension Data has been integrally involved with Datacraft for 11 years and, in the event theScheme becomes effective, anticipates minimal changes in the operations of Datacraft.Dimension Data intends to continue Datacraft’s services and solutions portfolio and maintain itsgo-to-market strategy, which are already closely aligned to that of Dimension Data. It also intendsto retain the Datacraft name due to the considerable brand equity and recognition built up over theyears to avoid significant costs in building a new brand across 13 different countries. DimensionData believes that Datacraft has a strong and experienced management team and committedemployees who are key and valued members of the Dimension Data Group and therefore alsodoes not anticipate any change in the management and reporting structure or envision anyretrenchments. Save as disclosed above, Dimension Data has no near-term plans, in the eventthat the Scheme becomes effective, to (a) introduce any major changes to the businesses of theDatacraft Group, (b) make any major disposal or redeployment of assets (including the fixedassets of the Datacraft Group) or (c) discontinue the employment of the employees of theDatacraft Group.

4. OPTIONS PROPOSAL

4.1 Outstanding Options. As at the Latest Practicable Date, there are 27,726,000 outstanding ShareOptions entitling Optionholders to subscribe for a total of 27,726,000 Shares granted pursuant tothe Datacraft Share Option Schemes. Of the 27,726,000 outstanding Options, there are:

(a) 7,366,000 In-the-Money Vested Options;

(b) 6,160,000 Out-of-the-Money Vested Options; and

(c) 14,200,000 Unvested Options.

4.2 Options Proposal. The Scheme will not be extended to Optionholders. As mentioned inparagraph 3 of this Letter, Dimension Data believes that Datacraft has a strong and experiencedmanagement team and committed employees who are key and valued members of the DimensionData Group. Dimension Data therefore does not intend to change the management and reportingstructure or retrench any of the staff of Datacraft. Dimension Data also does not intend toimplement any changes to the terms and conditions of the employment of Datacraft employeesin the near term, including the operation of the Datacraft Share Option Schemes. Consequently,pursuant to the terms of the Implementation Agreement, Dimension Data has agreed to make anappropriate proposal (the “Options Proposal”) to Optionholders in connection with the Schemethat will (a) preserve the position of Optionholders, (b) continue to sufficiently motivate them tocontinue to contribute to the Datacraft Group and (c) be on terms that are fair and reasonablecompensation for the holders of Options, as determined by the auditors of Datacraft (acting asexperts and not arbitrators) under the Datacraft Share Option Schemes.

The terms of, and further details on, the Options Proposal are set out in Part A to Annex 1 of thisLetter.

4.3 Letter to Optionholders. A separate letter from Dimension Data and Datacraft to eachOptionholder setting out the terms and conditions of the Options Proposal and explaining theimpact of the Scheme on the Options, has been or will be, at the same time as this Document,despatched to the Optionholders.


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5. AWARDS GRANTED UNDER THE DATACRAFT ASIA PERFORMANCE SHARE PLAN

5.1 Awards. As at the Latest Practicable Date, there are outstanding conditional awards (“Awards”)granted under the Datacraft Share Plan to Grantees to receive 1,098,000 Datacraft Shares. TheDatacraft Shares which are the subject of such Awards will only be released to Grantees after avesting period if certain pre-determined performance targets as determined by the committeeadministering the Datacraft Share Plan are achieved by the relevant Grantee or otherwise inaccordance with the Datacraft Share Plan. The Awards will be released from 28 March 2011 if theperformance conditions attached to such Awards are satisfied.

5.2 Arrangements in relation to Awards. In the case of such Awards, for the reasons set out inparagraph 4.2 above, it is proposed in the event that the relevant performance conditions aresatisfied and the Awards vest after the Effective Date, instead of receiving Datacraft Shares,Dimension Data will procure that the Grantees receive such number of Dimension Data Sharesbased upon the Cash Consideration payable under the Scheme for each Scheme Share and thevolume weighted average price of a Dimension Data Share on the LSE on the Effective Date.

Further details on such arrangements are set out in Part B to Annex 1 of this Letter.

6. CAPITAL REDUCTION AND CAPITAL DISTRIBUTION

The Capital Distribution (which is an integral part of the Scheme) will be effected by Datacraft byway of the Capital Reduction. The Capital Distribution and the Capital Reduction is conditionalupon certain conditions which must be satisfied, including, inter alia, the passing of the CapitalDistribution Resolution at the EGM, the Scheme being approved by a majority in number of,representing not less than three-fourths in value of the Shares held by Scheme Shareholderspresent and voting, either in person or by proxy, at the Court Meeting, the sanction of the Courtfor the Scheme and the Capital Distribution and the lodgement of the Scheme Court Order andCapital Distribution Court Order with ACRA. Further details on the Capital Distribution and theCapital Reduction, including the rationale for and the financial effects of the Capital Distributionand the Capital Reduction, are more particularly described in paragraph 4 of Datacraft’s Letter toShareholders in the Document.

7. IMPLEMENTATION OF THE SCHEME

7.1 Implementation of the Scheme. Paragraphs 7.2 to 7.7 below set out the procedure for theimplementation of the Scheme as well as the procedures for settlement and registration.

7.2 Procedure. If Scheme Shareholders approve the Scheme at the Court Meeting and the CapitalDistribution at the EGM, and the Court sanctions the Scheme and confirms and approves theCapital Distribution, Dimension Data and Datacraft will take the necessary steps to render theScheme effective and the following will be implemented:

(a) the Scheme Shares held by Entitled Scheme Shareholders will be transferred to DimensionData and/or its nominees for the Cash Consideration to be paid to the Entitled SchemeShareholders for each Scheme Share transferred;

(b) from the Effective Date, all existing share certificates relating to the Scheme Shares held bythe Entitled Scheme Shareholders will cease to have any effect;

(c) Entitled Scheme Shareholders (not being Depositors) are required to forward their existingshare certificates relating to their Scheme Shares to the Share Registrar’s office at therequest of Dimension Data;


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(d) Dimension Data shall, not later than 10 calendar days after the Effective Date, and againstthe transfer of the Scheme Shares set out in paragraph 7.2(a) above, make payment of theScheme Price payable on the transfer of the Scheme Shares to:

(i) each Entitled Scheme Shareholder (not being a Depositor) by sending a cheque for theaggregate Scheme Price payable to such Entitled Scheme Shareholder made out infavour of such Entitled Scheme Shareholder by post to his address in the Register ofMembers of Datacraft at the close of business on the latest practicable date prior to thedespatch of such cheque, at the sole risk of such Entitled Scheme Shareholder, or inthe case of joint Entitled Scheme Shareholders, to the first named Entitled SchemeShareholder made out in favour of such Entitled Scheme Shareholder by post to hisaddress in the Register of Members of Datacraft at the close of business on the latestpracticable date prior to the despatch of such cheque, at the sole risk of such EntitledScheme Shareholders; and

(ii) each Entitled Scheme Shareholder (being a Depositor) by making payment of theaggregate Scheme Price payable to such Entitled Scheme Shareholder to CDP. CDPshall send to such Entitled Scheme Shareholder, by post to his address in theDepository Register at the close of business on the latest practicable date prior to thedespatch of such cheque and at the sole risk of such Entitled Scheme Shareholder, acheque for the payment of such aggregate Scheme Price made out in favour of suchEntitled Scheme Shareholder; and

(e) not later than 10 calendar days after the Effective Date and against the transfer of theScheme Shares set out in paragraph 7.2(a) above, Datacraft shall make payment of theCapital Distribution to each Entitled Scheme Shareholder (whose entitlement to the CapitalDistribution shall be determined on the basis of the Entitled Scheme Shareholder’s holdingsof Scheme Shares in the Register of Members and/or the Depository Register as at theBooks Closure Date) as follows:

(i) for each Entitled Scheme Shareholder (not being a Depositor) entitled thereto bysending a cheque for the Capital Distribution payable to such Entitled SchemeShareholder made out in favour of such Entitled Scheme Shareholder by post to hisaddress in the Register of Members of Datacraft at the close of business on the latestpracticable date prior to the despatch of such cheque, at the sole risk of such EntitledScheme Shareholder, or in the case of joint Entitled Scheme Shareholders, to the firstnamed Entitled Scheme Shareholder made out in favour of such Entitled SchemeShareholder by post to his address in the Register of Members of Datacraft at the closeof business on the latest practicable date prior to the despatch of such cheque, at thesole risk of such Entitled Scheme Shareholders; and

(ii) for each Entitled Scheme Shareholder (being a Depositor) by making payment of theCapital Distribution payable to such Entitled Scheme Shareholder to CDP. CDP shallsend to such Entitled Scheme Shareholder, by post to his address in the DepositoryRegister at the close of business on the latest practicable date prior to the despatch ofsuch cheque and at the sole risk of such Entitled Scheme Shareholder, a cheque forthe payment of the Capital Distribution made out in favour of such Entitled SchemeShareholder.

7.3 Payment of Cash Consideration. Assuming that both the Scheme and the Capital Reductionbecome effective on 7 November 2008, the posting of cheques for each of the Scheme Price andthe Capital Distribution under the Scheme in the manner set out in paragraphs 7.2(d) and 7.2(e)above, is expected to take place on or before 11 November 2008.


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7.4 Uncashed Cheques. On or after the day being six calendar months after the posting of suchcheques relating to the Scheme Price by Dimension Data and the Capital Distribution byDatacraft, Dimension Data and Datacraft shall have the right to cancel or countermand paymentof any such cheque which has not been cashed (or has been returned uncashed) and shall placeeach of the Scheme Price monies and the Capital Distribution monies in two bank accounts inDimension Data’s name in respect of the Scheme Price monies and Datacraft’s name in respectof the Capital Distribution monies, each with a licensed bank in Singapore selected by DimensionData and Datacraft. Each of Dimension Data and Datacraft or their successor entities shall holdsuch moneys until the expiration of six years from the Effective Date and shall prior to such datemake payments therefrom of sums (without interest in accordance with Clause 8(b) of theScheme) payable pursuant to Clause 8(b) of the Scheme to persons who satisfy Dimension Datain respect of the Scheme Price monies and/or Datacraft in respect of the Capital Distributionmonies or their successor entities that they are respectively entitled thereto and that the chequesreferred to in Clauses 5 and 6 of the Scheme if which they are payees have not been cashed.

7.5 Unclaimed Payments. On the expiry of six years from the Effective Date, each of DimensionData and Datacraft shall be released from any further obligation to make any payments of theScheme Price under the Scheme and the Capital Distribution, and Datacraft and its successorentity shall transfer to Dimension Data the balance (if any) of the sums then standing to the creditof the bank account referred to in Clause 8(a) of the Scheme including accrued interest subject,if applicable, to the deduction of interest, tax or any withholding tax or any other deductionrequired by law and subject to the deduction of any expenses.

7.6 Share Certificates. As of and from the Effective Date, each existing share certificate representinga former holding of Scheme Shares by the Scheme Shareholders (not being Depositors) willcease to be evidence of title to the Scheme Shares represented thereby.

7.7 Settlement and Registration. Subject to the Scheme and the Capital Distribution becomingeffective, the following settlement and registration procedures will apply:

(a) Entitled Scheme Shareholders whose Scheme Shares are not deposited with CDP

Entitlements of Scheme Shareholders (not being Depositors) to the Cash Consideration willbe determined on the basis of the Scheme Shareholders (not being Depositors) and theirholdings of Scheme Shares appearing in the Register of Members at 5.00 p.m. on the BooksClosure Date, which is tentatively scheduled on 31 October 2008.

Scheme Shareholders (not being Depositors) who have not already done so are requestedto take the necessary action to ensure that the Scheme Shares owned by them areregistered in their names by the Books Closure Date, which is expected to be on 31 October2008 at 5.00 p.m..

From the Effective Date, each existing share certificate representing a former holding ofScheme Shares by Entitled Scheme Shareholders (not being Depositors) will cease to beevidence of title to the Shares represented thereby. Within 10 calendar days of the EffectiveDate, each of Dimension Data and Datacraft shall make payment of the Scheme Price andthe Capital Distribution respectively to each Entitled Scheme Shareholder based on hisholding of Scheme Shares as at the Books Closure Date.


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(b) Entitled Scheme Shareholders whose Scheme Shares are deposited with CDP

Entitlements of Scheme Shareholders (being Depositors) to the Cash Consideration will bedetermined on the basis of the Scheme Shareholders (being Depositors) and the number ofScheme Shares standing to the credit of their Securities Account at 5.00 p.m. on the BooksClosure Date, which is expected to be on 31 October 2008.

Entitled Scheme Shareholders (being Depositors) who have not already done so arerequested to take the necessary action to ensure that the Scheme Shares owned by themare credited to their Securities Account by 5.00 p.m. on the Books Closure Date.

From the Effective Date, CDP will debit from each relevant Securities Account the numberof Scheme Shares standing to the credit of the Securities Account of the relevant EntitledScheme Shareholders (being a Depositor). Within 10 calendar days of the Effective Date,CDP shall make payment of the Scheme Price and the Capital Distribution to each EntitledScheme Shareholder (being a Depositor) based on the number of Scheme Shares standingto the credit of his Securities Account as at the Books Closure Date.

8. DIMENSION DATA

8.1 Directors. The names, addresses and descriptions of the Dimension Data Directors as of theLatest Practicable Date are as follows:

Name Address Description

Jeremy John Ord 19A Coronation RoadSandhurstSouth Africa

Chairman

Brett William Dawson 20A Ormonde StreetBryanston, 2021South Africa

Executive Director and ChiefExecutive Officer

Stephen Michael Joubert 128 Trafalgar PlaceSandhurst GautengSouth Africa

Executive Director

Patrick Keith Quarmby 108 Mount StreetBryanstonSouth Africa

Executive Director

David Brian Sherriffs 41A Saxon RoadSandhurst, 2196South Africa

Executive Director and ChiefFinancial Officer

Rupert George Barclay 25 Ladbroke SquareLondon W11 3NBUnited Kingdom

Independent Non-ExecutiveDirector


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Name Address Description

Leslie Frank Bergman 3 Wimpole MewsLondon W16 8PAUnited Kingdom


Peter John Liddiard 11 Zomerlust AvenueConstantia, 7806South Africa

Non-Executive Director

Wendy Lucas-Bull 20 Suikerbossie80 Mount StreetBryanston, 2191South Africa


Josua (Dillie) Malherbe 27 Bulties AvenueParel ValleySomerset West, 7130South Africa


Moses Modidima (Moss)Ngoasheng

266 Papenfus DriveBeaulieu, KyalamiSouth Africa


Roderick (Rory) Michael Scott 25 Lower Duthie StreetBelivedere EstateKnysa, 6570South Africa


Peter Dorian Wharton-Hood 4 Townsend RoadHyde Park, 2196South Africa


8.2 Principal Activities. Dimension Data is a public company incorporated in England and Walesunder the Companies Act 1985 and registered as an external company in the Republic of SouthAfrica with registration number 2000/009053/10. Dimension Data was founded in 1983 and in2007 had revenues of $3.8 billion. It is a specialist IT services and solutions provider that helpstheir 6,000 clients plan, build, support and manage their IT infrastructures. By continually buildingon its knowledge and expertise in IT infrastructure technologies, Dimension Data has become arecognised global leader in the provision and management of specialist IT infrastructure solutions.Drawing on its experience in network integration, security, converged communications, datacentres and storage, contact centre and Microsoft technologies, Dimension Data delivers a fulllifecycle of IT services. Today, the Dimension Data Group is positioned at the forefront ofnetworking and communications in nearly 40 countries around the world and employs in excessof 10,600 highly skilled employees. Dimension Data is a recognised industry leader with 80industry awards in 2007 and has a primary listing on the London Stock Exchange and is also listedon the Johannesburg Securities Exchange Limited.

8.3 Registered and Head Office. The registered office of Dimension Data is at Dimension DataHouse, Building 2, Waterfront Business Park, Fleet Road, Fleet, Hampshire, GU51 3QT, UnitedKingdom and its head office is at The Wanderers, The Campus, 57 Sloane Street, Bryanston,Sandton 2191, South Africa.


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9. FINANCIAL INFORMATION

9.1 Profit and Loss Accounts. A summary of the audited consolidated profit and loss accounts ofDimension Data for FY2005, FY2006 and FY2007, and the unaudited consolidated profit and lossaccount of Dimension Data for the six months ended 31 March 2008 (“2Q 2008”) is set out below:

Unaudited2Q 2008

AuditedFY2007

(Restated)AuditedFY2006

(Restated)AuditedFY2005

US$’000 US$’000 US$’000 US$’000

Revenue 2,171,212 3,773,156 3,067,962 2,646,083

Cost of sales (1,709,002) (2,960,169) (2,420,565) (2,090,098)

Gross profit 462,210 812,987 647,397 555,985

Profit before tax 89,788 150,505 65,468 44,839

Tax (22,885) (36,034) (8,310) (20,556)

Profit after tax for the year/period 66,903 114,471 57,158 24,283

Attributable to:

Equity holders 55,881 92,528 40,602 13,802

Minority interest 11,022 21,943 16,556 10,481

66,903 114,471 57,158 24,283

Profit after tax attributable toequity holders 55,881 92,528 40,602 13,802

Less: net exceptional items 3,691(1) 6,432(2) 10,423(3) 2,943(4)

Adjusted profit after taxattributable to equity holders(after adjusting for the netexceptional items above) 52,190 86,096 30,179 10,859

Earnings per share (US cents)

Basic(5) 3.7 6.0 2.7 1.0

Diluted(6) 3.4 5.6 2.6 1.0

Dividends per share (US cents) 0 1.5 1.0 0

Notes:

(1) Consists of other exceptional gains and losses.

(2) Consists of exceptional operating costs, exceptional associate cost, other exceptional gains, exceptional tax itemsand after minorities’ share of exceptional items.

(3) Consists of exceptional operating costs, exceptional tax item and after minorities’ share of exceptional items.

(4) Consists of exceptional income.

(5) Excludes exceptional items and based on the weighted average number of ordinary shares for the purposes of basicearnings per share.

(6) Excludes exceptional items and based on the weighted average number of ordinary shares for the purposes of dilutedearnings per share.


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This summary financial information should be read together with the audited consolidatedfinancial statements of Dimension Data for the relevant years and related notes thereto, copies ofwhich are available for inspection at the registered office of Datacraft at 6 Temasek Boulevard,#26-01/05 Suntec Tower Four, Singapore 038986 during normal business hours.

The unaudited profit and loss account of Dimension Data for 2Q 2008 and the correspondingperiod in the preceding year is set out in Annex 2 of this Letter.

9.2 Statement of Assets and Liabilities. A summary of the audited consolidated balance sheet ofDimension Data as at 30 September 2007 and the unaudited consolidated balance sheet ofDimension Data as at 31 March 2008 is set out below:

UnauditedSix months ended

31 March 2008

AuditedYear ended

30 September 2007US$’000 US$’000

ASSETS

Non-current assets

Property, plant and equipment 161,207 165,014

Investment property 80,156 92,805

Goodwill 95,414 90,557

Other intangible assets 11,807 16,914

Investments in associates 33,708 30,381

Other investments 4,753 6,971

Deferred tax assets 40,386 41,248

Trade and other receivables 49,432 36,804

476,863 480,694

Current assets

Inventories 198,472 192,658

Trade and other receivables 1,070,609 968,336

Other financial instruments – 2,505

Taxation authorities receivable – 32,713

Cash and cash equivalents 396,716 459,197

1,665,797 1,655,409

Total assets 2,142,660 2,136,103

EQUITY AND LIABILITIES

Capital and reserves

Share capital 15,371

Share premium 180,794

Total other reserves 261,703

Retained earnings 104,079

Equity attributable to equity shareholders of parent 560,701 561,947

Minority interest 130,473 128,242

Total equity 691,174 690,189


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UnauditedSix months ended

31 March 2008

AuditedYear ended

30 September 2007US$’000 US$’000

Non-current liabilities

Bank overdrafts and loans 4,034 4,144

Other long term liabilities 42,156 31,207

Obligations under finance leases 132,944 149,919

Deferred tax liabilities 1,773 2,295

Provisions 8,568 9,517

189,475 197,082

Current liabilities

Trade and other payables 1,230,913 1,080,486

Other financial instruments – 3,975

Taxation authorities payable – 128,692

Bank loans 14,869 20,475

Bank overdrafts 1,022 3,439

Provisions 15,207 11,765

1,262,011 1,248,832

Total liabilities 1,451,486 1,445,914

Total equity and liabilities 2,142,660 2,136,103

This summary financial information should be read together with the audited consolidatedfinancial statements of Dimension Data for FY2007 and related notes thereto, copies of which areavailable for inspection at the registered office of Datacraft at 6 Temasek Boulevard, #26-01/05Suntec Tower Four, Singapore 038986 during normal business hours.

The unaudited consolidated balance sheet of Dimension Data as at 31 March 2008 and thecorresponding period in the preceding year is set out in Annex 2 of this Letter.

9.3 Material Changes in Financial Position of Dimension Data. As at the Latest Practicable Date,save as disclosed below and save for the unaudited consolidated financial statements ofDimension Data for 2Q 2008 announced on 14 May 2008 set out in Annex 2 of this Letter, as wellas save for the making and financing of purchases of Shares by Dimension Data and the Scheme,there have been no material changes to the financial position of Dimension Data since 30September 2007, being the date of the last audited accounts of Dimension Data laid beforeshareholders of Dimension Data in general meeting.

9.4 Significant Accounting Policies. The significant accounting policies of Dimension Data havebeen extracted from Note 2 to the audited consolidated financial statements of Dimension Datafor FY2007 and are set out in Annex 3 of this Letter.


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10. DISCLOSURE OF INTERESTS AND DEALINGS IN SECURITIES

10.1 Holdings of Shares. As at the Latest Practicable Date, save as disclosed below and in theDocument, none of Dimension Data, the Dimension Data Directors or any party deemed to beacting in concert with Dimension Data, owns or controls or has agreed to acquire any Shares orsecurities which carry voting rights in Datacraft, or instruments convertible into, rights to subscribefor or options in respect of such Shares or such securities.

Direct Interest Deemed Interest Total Interest

NameNo. ofShares %

No. ofShares %

No. ofShares %

Dimension Data Holdings plc(1) 254,453,105 55.08 98,514 0.02 254,551,619 55.10

William B. G. Padfield(2) 110,000 0.024 – – 110,000 0.024

Notes:

(1) Dimension Data is deemed to be interested in 98,514 Shares, representing approximately 0.02 per cent. of theDatacraft Shares in issue (excluding treasury shares), held by its wholly-owned subsidiary, Dimension Data AustraliaPty Limited.

(2) Mr William B. G. Padfield is an Executive Director and the Chief Executive Officer of Datacraft, and a member of theGroup Executive Committee of Dimension Data. Mr Padfield has also been granted Options to subscribe for3,040,000 Datacraft Shares and conditional awards of 708,000 performance shares under the Datacraft Share Planto be released from 28 March 2011. Datacraft Shares which are the subject of Awards will be released to Participantafter a vesting period if certain pre-determined performance targets as determined by the committee administeringthe Datacraft Share Plan are achieved by the relevant Participant or otherwise in accordance with the Datacraft SharePlan.

10.2 Dealings. As at the Latest Practicable Date, save as disclosed in the Document, none ofDimension Data, the Dimension Data Directors or any party deemed to be acting in concert withDimension Data has dealt for value in any Shares during period commencing three months priorto the Joint Announcement Date and ending on the Latest Practicable Date.

10.3 Irrevocable Commitments. As at the Latest Practicable Date, none of Dimension Data, theDimension Data Directors or any party deemed to be acting in concert with Dimension Data hasreceived any irrevocable undertaking to vote in favour of the Scheme at the Court Meeting and/orthe Capital Distribution Resolution at the EGM.

10.4 Arrangements relating to the Shares. As at the Latest Practicable Date, neither Dimension Datanor any party deemed to be acting in concert with it has entered into any arrangement with anyperson of the kind referred to in Note 7 of Rule 12 of the Code, including indemnity or optionarrangements, and any kind of agreement or understanding, formal or informal, of whatevernature, relating to the Datacraft Shares which may be an inducement to deal or refrain fromdealing in the Datacraft Shares.

11. SPECIAL ARRANGEMENTS

11.1 No Agreement having Connection with or Dependence upon the Scheme. As at the LatestPracticable Date, there is no agreement, arrangement or understanding between Dimension Dataor any party acting in concert with it and (a) any of the current or recent directors of Datacraft or(b) any of the current or recent shareholders of Datacraft having any connection with ordependence upon the Scheme.


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11.2 Transfer of Scheme Shares. As at the Latest Practicable Date, there is no agreement,arrangement or understanding whereby any Scheme Shares acquired by Dimension Data and/orits nominees pursuant to the Scheme would be transferred to any other person. However,Dimension Data reserves the right to transfer any of the Scheme Shares to any of its relatedcompanies or for the purpose of granting security in favour of financial institutions which haveextended credit facilities to it.

11.3 No Payment or Benefit to the Directors of Datacraft. As at the Latest Practicable Date, thereis no agreement, arrangement or understanding for any payment or other benefit to be made orgiven to any director of Datacraft or any director of its related corporations as compensation forloss of office or otherwise in connection with the Scheme.

11.4 No Agreement Conditional upon Outcome of the Scheme. As at the Latest Practicable Date,there is no agreement, arrangement or understanding between Dimension Data and any of thedirectors of Datacraft or any other person in connection with or conditional upon the outcome ofthe Scheme or otherwise connected with the Scheme.

12. GENERAL AND FINANCIAL INFORMATION RELATING TO DATACRAFT

12.1 Transfer Restrictions. The Memorandum and Articles of Association of Datacraft do not containany restrictions on the right to transfer the Scheme Shares which has the effect of requiringScheme Shareholders, before transferring them, to offer them for purchase to other members ofDatacraft or to any person.

12.2 Material Changes in the Financial Position of Datacraft. Save as disclosed in the Documentand in the announcement by Datacraft on 13 August 2008 of its unaudited consolidated financialstatements for the nine months ended 30 June 2008, within the knowledge of Dimension Data,there are no material changes in the financial position or prospects of Datacraft since 30September 2007, being the date of the last balance sheet laid before Datacraft in general meeting,which is reproduced in Appendix 5 of the Document.

13. SHAREHOLDINGS OF DIMENSION DATA PRIOR TO, AND FOLLOWING, COMPLETION OFTHE SCHEME

Based on the holdings of Datacraft Shares of Dimension Data and the number of Datacraft Sharesin issue as at the Latest Practicable Date, the shareholdings of Dimension Data in Datacraft priorto, and following, completion of the Scheme are as follows:

Prior to the completion ofthe Scheme

Following the completionof the Scheme

No. of Datacraft Sharesheld directly and indirectly

No. of Datacraft Sharesheld directly and indirectly

Dimension Data 254,551,619 461,981,427


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14. DATACRAFT MARKET QUOTATIONS

14.1 Transacted Prices. The high, low (on the daily closing prices for the monthly market data) andlast closing prices and transacted volume of the Shares on the SGX-ST on a monthly basis fromJanuary 2008 to August 2008 and on a daily basis from 1 September 2008 to the LatestPracticable Date, are set out below:

High(US$)

Low(US$)

Closing(US$)

Volume(’000)

(No. of Shares)

Monthly Trades

January 2008 1.240 1.070 1.070 11,259

February 2008 1.140 1.070 1.120 5,537

March 2008 1.130 0.875 0.890 14,280

April 2008 0.980 0.885 0.915 15,907

May 2008 1.060 0.915 1.040 11,850

June 2008 1.080 1.010 1.020 6,704

July 2008 1.290 0.985 1.280 9,683

August 2008 1.290 1.260 1.270 20,927

Daily Trades

1 September 2008 1.280 1.270 1.270 144

2 September 2008 1.280 1.260 1.280 1,098

3 September 2008 1.280 1.270 1.270 495

4 September 2008 1.280 1.270 1.280 169

5 September 2008 1.280 1.270 1.270 659

8 September 2008 1.290 1.280 1.280 968

9 September 2008 1.290 1.270 1.270 5,706

10 September 2008 1.280 1.270 1.280 256

11 September 2008 1.280 1.280 1.280 487

12 September 2008 1.290 1.280 1.280 236

15 September 2008 1.280 1.270 1.280 759

Source: Bloomberg

14.2 Closing Prices. The closing prices of the Shares on the SGX-ST on (a) the last trading day priorto the Announcement Date was US$0.990 per Share and (b) the Latest Practicable Date wasUS$1.280 per Share.

14.3 Highest and Lowest Prices. During the period commencing six months prior to 22 July 2008(being the Announcement Date) and ending on the Latest Practicable Date, the highest closingprice of the Shares on the SGX-ST was US$1.290 per Share transacted on 25 July 2008, 6 August2008, 11 August 2008 and 12 August 2008, and the lowest closing price of the Shares on theSGX-ST was US$0.875 per Share transacted on 28 March 2008.


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15. CONFIRMATION OF FINANCIAL RESOURCES

Cazenove, as financial adviser to Dimension Data, confirms that sufficient financial resources areavailable to Dimension Data to satisfy in full the cash consideration to be paid to SchemeShareholders pursuant to the Scheme.

16. RESPONSIBILITY STATEMENT

The directors of Dimension Data (including any director who may have delegated detailedsupervision of this Letter) have taken all reasonable care to ensure that the facts stated andopinions expressed in this Letter (other than those relating to Datacraft, the Datacraft Group andCazenove) are fair and accurate and that no material facts have been omitted from this Letter, andthey jointly and severally accept responsibility accordingly. Where any information has beenextracted from published or publicly available sources, the sole responsibility of the directors ofDimension Data has been to ensure through reasonable enquiries that such information isaccurately extracted from such sources or, as the case may be, reflected or reproduced in thisLetter.

Yours faithfullyFor and on behalf ofDIMENSION DATA HOLDINGS PLC

Brett William DawsonExecutive Director and Chief Executive Officer


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ANNEX 1

Part A

The terms of the Options Proposal are as follows:

(a) In-the-Money Vested Options. In respect of the In-the-Money Vested Options, subject to:

(i) the Scheme becoming effective and binding; and

(ii) such In-the-Money Vested Options continuing to be exercisable into new Datacraft Sharesas at the Effective Date,

Dimension Data will pay In-the-Money Vested Optionholders a cash amount calculated basedupon the “see-through” price, being the excess of the Cash Consideration payable under theScheme for each Scheme Share over the exercise price of the respective In-the-Money VestedOptions, in consideration for such In-the-Money Vested Optionholders agreeing:

(A) not to exercise all or any of such In-the-Money Vested Options into new Datacraft Shares;and

(B) not to exercise all or any of their other rights as Optionholders,

in each case from the date of their acceptance of the Options Proposal to the respective dates ofexpiry of such In-the-Money Vested Options. In addition, in the event that the Scheme becomeseffective, In-the-Money Vested Optionholders who have accepted the Options Proposal will alsobe required to surrender all of their In-the-Money Vested Options for cancellation.

(b) Out-of-the-Money Vested Options. In respect of the Out-of-the-Money Vested Options, subjectto:

(i) the Scheme becoming effective and binding;

(ii) such Out-of-the-Money Vested Options continuing to be exercisable into new DatacraftShares as at the Effective Date; and

(iii) the auditors of Datacraft (acting only as experts and not as arbitrators) confirming in writingthat the following arrangements are fair and reasonable,

Dimension Data will procure that, instead of receiving new Datacraft Shares issued by Datacrafton any exercise of such Out-of-the-Money Vested Options after the Effective Date, Out-of-the-Money Vested Optionholders will receive such number of Dimension Data Shares based upon theCash Consideration payable under the Scheme for each Scheme Share and the volume weightedaverage price of a Dimension Data Share on the LSE on the Effective Date, such number ofDimension Data Shares being determined as follows:

A =(B x C)

(D x Exchange Rate)


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Where:

A : Number of Dimension Data Shares to be received on exercise ofOut-of-the-Money Vested Options;

B : Number of new Datacraft Shares originally to be issued by Datacraft onexercise of Out-of-the-Money Vested Options;

C : US$1.33, being the Cash Consideration payable under the Scheme foreach Scheme Share;

D : An amount in £ equivalent to the volume weighted average price of aDimension Data Share on the LSE on the Effective Date; and

Exchange Rate : The rate of exchange between US$ and £ as shown on Bloomberg“GBP Currency QR” at 5.00 p.m. (Singapore time) on the EffectiveDate, provided that if Bloomberg ceases to display such information,such page as displays such information on such other services as maybe selected by Dimension Data,

in consideration of such Out-of-the-Money Vested Optionholders agreeing:

(A) not to exercise all or any such Out-of-the-Money Vested Options into new Datacraft Shares;and

(B) not to exercise all or any of their rights as holders of such Out-of-the-Money Vested Options,

in each case from the date of their acceptance of the Options Proposal up to and including theEffective Date. In the event the Scheme becomes effective and the auditors of Datacraft confirmin writing that the above arrangements are fair and reasonable, the Out-of-the-Money VestedOptions will not lapse and will continue until the expiry of the relevant option period(s). Datacraftwill deliver, and/or Dimension Data will procure that Datacraft delivers, Dimension Data Sharespursuant to any exercise of Out-of-the-Money Vested Options after the Effective Date in the formof existing Dimension Data Shares purchased from the market. Fractions of a Dimension DataShare will not be delivered and will be disregarded.

For the avoidance of doubt, other than the substitution of an equivalent value of Dimension DataShares for the new Datacraft Shares to be issued on exercise of the Out-of-the-Money VestedOptions by Out-of-the-Money Vested Optionholders, all other terms of such Options, including,inter alia, the exercise price, will remain the same.

(c) Unvested Options. In respect of the Unvested Options, subject to:

(i) the Scheme becoming effective and binding;

(ii) such Unvested Options continuing to be exercisable into new Datacraft Shares as at theEffective Date (and where performance conditions are attached to the vesting of suchUnvested Option, such performance conditions having been satisfied by the relevantOptionholder or waived by the Committee); and

(iii) the auditors of Datacraft (acting only as experts and not as arbitrators) confirming in writingthat the following arrangements are fair and reasonable,


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Dimension Data will procure that, instead of receiving new Datacraft Shares issued by Datacrafton any exercise of such Unvested Options after the Effective Date, Unvested Optionholders willreceive such number of Dimension Data Shares based upon the Cash Consideration payableunder the Scheme for each Scheme Share and the volume weighted average price of aDimension Data Share on the LSE on the Effective Date, such number of Dimension Data Sharesbeing determined as follows:

E =(F x G)

(H x Exchange Rate)

Where:

E : Number of Dimension Data Shares to be received on exercise ofUnvested Options;

F : Number of new Datacraft Shares originally to be issued by Datacraft onexercise of Unvested Options;

G : US$1.33, being the Cash Consideration payable under the Scheme foreach Scheme Share;

H : An amount in £ equivalent to the volume weighted average price of aDimension Data Share on the LSE on the Effective Date; and

Exchange Rate : The rate of exchange between US$ and £ as shown on Bloomberg“GBP Currency QR” at 5.00 p.m. (Singapore time) on the EffectiveDate, provided that if Bloomberg ceases to display such information,such page as displays such information on such other services as maybe selected by Dimension Data,

in consideration of such Unvested Optionholders agreeing:

(A) not to exercise all or any such Unvested Options into new Datacraft Shares; and

(B) not to exercise all or any of their rights as holders of such Unvested Options,

in each case from the date of their acceptance of the Options Proposal up to and including theEffective Date. In the event the Scheme becomes effective and the auditors of Datacraft confirmin writing that the above arrangements are fair and reasonable, the Unvested Options will notlapse and will continue until the expiry of the relevant option period(s). Datacraft will deliver,and/or Dimension Data will procure that Datacraft delivers, Dimension Data Shares pursuant toany exercise of Unvested Options after the Effective Date in the form of existing Dimension DataShares purchased from the market. Fractions of a Dimension Data Share will not be delivered andwill be disregarded.

For the avoidance of doubt, other than the substitution of an equivalent value of Dimension DataShares for the new Datacraft Shares to be issued on exercise of the Unvested Options byUnvested Optionholders, all other terms of such Options, including, inter alia, the exercise price,the vesting period(s) and any performance conditions to be satisfied by the UnvestedOptionholder prior to vesting, will remain the same.


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(d) Accelerated Exercise Period. Under Rule 7(b) of the Datacraft Option Schemes, if the Courtsanctions the Scheme, Optionholders (including Optionholders holding Options which are thennot exercisable pursuant to the provisions of the Datacraft Share Option Schemes) shall beentitled to exercise any Options then held by them during the Accelerated Exercise Period. On theexpiry of the Accelerated Exercise Period, any unexercised Options shall lapse and become nulland void.

However, under Rule 7(e) of the Datacraft Share Option Schemes, if arrangements are made(which are confirmed in writing by the auditors of Datacraft, acting only as experts and not asarbitrators, to be fair and reasonable) for the compensation of Optionholders, whether bycontinuation of their Options, or the payment of cash or the grant of other options or otherwise,an Optionholder holding an Option, which is then not exercisable, may not, at the discretion of theCommittee be permitted to exercise that Option during the Accelerated Exercise Period.

(e) Committee and Amendment to Rule 7(e). Pursuant to rules of the Datacraft Share OptionSchemes (“Rules”), the Committee shall have the power, from time to time, to make and varysuch regulations (not being inconsistent with the Scheme) for the implementation andadministration of the Datacraft Share Option Schemes as it thinks fit. Also, save for, inter alia,modifications or alterations (a) which alter adversely the rights attaching to any Options grantedprior to such modification or alteration and (b) to certain definitions in the Rules (including, but notlimited to, “Committee”, “Option Period” and “Participant”) and certain provisions of the Rules(including, but not limited to, Rule 3 “Eligibility of Participants”, Rule 4 “Grant of Options” and Rule6 “Rights to Exercise Options”), any or all of the provisions of the Datacraft Share Option Schemesmay be modified and/or altered at any time and from time to time by resolution of the Committee.

Rule 7(e) currently only refers to “options which are not then exercisable” and is silent on Optionswhich have already vested and are exercisable. Consequently Rule 7(e) as currently provided for,does not apply to arrangements such as the Options Proposal in respect of Options which havealready vested and are exercisable.

As, in the event the Scheme becomes effective, Dimension Data (i) does not intend to implementany changes to the terms and conditions of the employment of Datacraft employees in the nearterm, including the operation of the Datacraft Share Option Schemes, (ii) intends for the Optionsto continue after the Scheme becomes effective and (iii) has agreed in the ImplementationAgreement for the Options Proposal to, inter alia, preserve the position of Optionholders, theCommittee has determined that, to facilitate the making and the implementation of the OptionsProposal in respect of the Out-of-the-Money Vested Options and the Unvested Options, subjectto (A) the Scheme becoming effective and binding, and (B) the auditors of Datacraft (acting onlyas experts and not as arbitrators) confirming in writing that the above arrangements in relation tothe Out-of-Money Vested Options and the Unvested Options are fair and reasonable:

(1) Rule 7(e) be amended to include Options which have already vested and are exercisablewithin its scope, as follows:

“If in connection....with the scheme referred to in paragraph (b) above....arrangements aremade (which are confirmed in writing by the auditors of the Company, acting only as expertsand not as arbitrators, to be fair and reasonable) for the compensation of Participants,whether by continuation of their options, or the payment of cash or the grant of other optionsor otherwise, a Participant holding an option, which is not then exercisable whether ornot such an option is then exercisable, may not, at the discretion of the Committee bepermitted to exercise that option as provided for in this Rule 7.”; and


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(2) where an Out-of-the-Money Vested Optionholder and/or an Unvested Optionholder acceptsthe Options Proposal in respect of his/her Out-of-the-Money Vested Options and/orUnvested Options respectively, such Out-of-the-Money Vested Optionholder and/orUnvested Optionholder shall not, subject to the discretion of the Committee, be permitted toexercise their Options during the Accelerated Exercise Period.

(f) Auditors’ Confirmation. The auditors of Datacraft have, on 10 September 2008, confirmed thatthe above arrangements in the Options Proposal in relation to the Out-of-the-Money VestedOptions and the Unvested Options are fair and reasonable.

(g) SGX-ST. Rule 14(a)(iii) of the Datacraft Share Option Schemes provide, inter alia, that nomodification or alteration shall be made without the prior approval of the SGX-ST. The SGX-SThas granted its in-principle approval for the proposed modification of Rule 7(e) of the DatacraftShare Option Schemes, subject to the Scheme becoming effective.

Part B

The arrangements relating to the Awards are as follows:

In the event that the relevant performance conditions are satisfied and the Awards vest after theEffective Date, instead of receiving Datacraft Shares, Dimension Data will procure that the Granteesreceive such number of Dimension Data Shares based upon the Cash Consideration payable under theScheme for each Scheme Share and the volume weighted average price of a Dimension Data Shareon the LSE on the Effective Date, such number of Dimension Data Shares being determined as follows:

J =(K x L)

(M x Exchange Rate)

Where:

J : Number of Dimension Data Shares to be received on vesting anddelivery of Awards;

K : Number of Datacraft Shares originally to be received on vesting anddelivery of Awards;

L : US$1.33, being the Cash Consideration payable under the Scheme foreach Scheme Share;

M : An amount in £ equivalent to the volume weighted average price of aDimension Data Share on the LSE on the Effective Date; and

Exchange Rate : The rate of exchange between US$ and £ as shown on Bloomberg“GBP Currency QR” at 5.00 p.m. (Singapore time) on the EffectiveDate, provided that if Bloomberg ceases to display such information,such page as displays such information on such other services as maybe selected by Dimension Data.


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Datacraft will deliver, and/or Dimension Data will procure that Datacraft delivers, Dimension DataShares pursuant to any vesting and delivery of Awards after the Effective Date in the form of existingDimension Data Shares purchased from the market. Fractions of a Dimension Data Share will not bedelivered and will be disregarded.

For the avoidance of doubt, other than the substitution of an equivalent value of Dimension Data Sharesfor the Datacraft Shares to be delivered on the vesting and delivery of an Award, all other terms of theAwards, including the vesting period(s) and any performance conditions to be satisfied by theGrantee(s) prior to vesting, will remain the same.


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ANNEX 2

Unaudited consolidated financial statements of Dimension Data Holdings plc for 2Q 2008

Dimension Data Holdings plcUnaudited Interim Results

Six months ended 31 March 2008

Dimension Data Holdings plc (‘Dimension Data’ or the ‘Group’) today announced its results for the sixmonths ended 31 March 2008. The results have been prepared in accordance with InternationalFinancial Reporting Standards, as adopted by the European Union.

Highlights

• Revenue up by 22.7% to $2.2 billion (Product up 22.6%, Services up 22.7%)

• Constant currency revenue(2) up by 16.3% (Product up 15.4%, Services up 17.8%)

• Growth and margin expansion in all Regions

• Supported by Network Integration up 16.6%(2), Security up 35.6%(2) and ConvergedCommunications up 20.9%(2)

• Gross margin increased to 21.3% (H1 2007: 20.9%)

• Operating profit(1) up 54.5% to $85.0 million

• Operating margin(1) increased to 3.9% (H1 2007: 3.1%)

• Earnings per share(1) increased 41.7% to 3.4 cents (H1 2007: 2.4 cents)

Financial Summary

$’000

Six monthsended

31 March 2008

Six monthsended

31 March 2007

Revenue 2,171,212 1,770,140

Operating profit 85,016 48,425

Margin 3.9% 2.7%

Operating profit (before exceptional items) 85,016 55,032

Margin (before exceptional items) 3.9% 3.1%

Profit attributable to equity shareholders of the parent 55,881 32,613

Profit attributable to equity shareholders of the parent(before exceptional items) 52,190 36,647

Earnings per ordinary share (US cents) 3.7 2.1

Earnings per ordinary share (before exceptional items)(US cents) 3.4 2.4

Notes:

(1) Before exceptional items. See reconciliation in Note 3 to the condensed financial statements.

(2) Before eliminating intercompany revenue and adjusted for the impact of currency movements and the disposal of theGroup’s Swedish operations in the prior year.


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Chief Executive Officer’s Review

A SOLID PERFORMANCE

During the first half of FY08, Dimension Data delivered an excellent financial performance. Revenueincreased 23%. Operating profit(1) increased 55% to $85 million, resulting in an operating margin(1)

improvement from 3.1% to 3.9% driven by improved gross margins and operating leverage.

We drive growth in three ways across the Group — through our regions, lines of business, and servicesand during the period achieved a successful performance in all three. All regions performed well withrevenue growth and improved operating margins(1) in all cases. We experienced double digit growthacross all our lines of business with substantial market share gains in Network Integration and Securitywith Services growth at 23%.

While we are driving for growth, it is imperative that we continue to invest for the longer term to be ableto offer an excellent client experience and deliver operational excellence. Notwithstanding ourincreased levels of investment in these areas, we report further operational leverage reflected in adecline in overheads as a percentage of revenue to 17.4% from 17.8%. This improvement flows fromdisciplined cost management, continued productivity improvements and the benefits of increasingscale.

At the core of this performance are our outstanding people whose commitment to delivering anoutstanding result for our clients continues to be the basis of our success in the market.

A CHANGING MARKET ENVIRONMENT

Our success in the first half FY08 has played out against a backdrop of uncertain economic conditionsin global markets. Despite some of the geographies and industry sectors in which we operate feelingthe effects of the credit market related downturn, demand for the Group’s solutions and services hasremained strong. We continue to monitor current market conditions and remain optimistic for ourmedium term prospects, as many of our lines of business and services are intended to improve the costefficiency, effectiveness and performance of our clients’ IT infrastructure.

CIOs and IT directors are at present focused on several key drivers. They are looking to drive costefficiencies through leveraging their existing investments. They are seeking greater effectivenessthrough consolidation, standardisation and virtualisation of their infrastructures. They are focused onthe need to refresh outdated IT infrastructure and on keeping existing operations secure and at therequired state of performance. They are ensuring that any new IT investments are “future ready” tosupport emerging technologies. An important priority for them is the consideration of new sourcingstrategies for support services, managed services adoption and multisourcing. They are beingparticularly cautious in the current macro-economic climate.

Many of the solutions that Dimension Data offers help our clients achieve cost efficiencies and improvethe effectiveness and performance of their existing infrastructures. For example, our NetworkIntegration solutions build and refresh the core communications infrastructure that has become theplatform for all business transactions and communications and must perform optimally, 24 x 7 yearround. In addition, requirements for our clients to refresh existing network infrastructure that is end oflife or end of support is driving growth. Our Data Centre and Storage solutions save costs throughconsolidating server sprawl while reducing energy consumption and improving applicationperformance. With security attacks on corporate networks increasing, our Security solutions continueto be compelling. We are seeing increased interest in Converged Communications solutions and thedeployment of IP Telephony is now mainstream. Demand for visual communications solutions such as


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telepresence and videoconferencing is growing as the technology matures, and clients look to enhancethe effectiveness of their employees whilst reducing the costs and carbon emissions associated with airtravel.

During uncertain economic times, clients look for more flexibility in their IT service and delivery options.Clients are weighing up the cost value relationship of supporting and managing their IT infrastructuresin house versus outsourcing elements of that infrastructure. These trends are generating increasedinterest in Dimension Data’s portfolio of IT services.

Dimension Data’s solutions and services are well-positioned to continue growing in a market that isfocused on cost effectiveness and the efficiency of IT infrastructures. While it is difficult to estimate theduration or magnitude of the current downturn, we believe our offerings to be highly relevant andaligned to our clients’ immediate needs.

CLIENTS AND MARKET SEGMENTS

Our growth has been driven from a number of market segments. Telecommunications service providersaround the world continue to build-out their revenue generating networks. This is particularly true forgeographies like emerging Africa, Europe and Asia. We have seen robust public sector investment ina variety of IT projects including core network infrastructure, IT security, video surveillance and networkperformance optimisation. We have experienced solid growth in the commercial or mid-sized businesssector. We have also experienced good growth in revenues with a number of key global financialinstitutions where our global procurement and logistics services provide differentiation. However,against this backdrop of broader growth, we have seen the rate of growth in some financial servicesclients slow, as they become more cautious. Dimension Data’s presence amongst the largest globalcorporations has grown to include 74% of the Fortune 100 and 60% of the Fortune 500 companies.

OUR EMPLOYEES CREATE OUR SUCCESS

This year marks the fourth consecutive increase in our employee satisfaction scores, suggesting ahighly engaged and motivated employee base. We will continue to invest in our employees, their skills,personal growth, and careers, and in improving the employee experience at Dimension Data, as thisis critical to our success in the market. The value of our solutions and services is realised through thedaily delivery and execution by our 10,600 employees. Our employees bring the Dimension Data clientexperience to life. We continue to develop our 400 key leaders around the globe through the Group’sLeadership Forum programme. The Leadership Forum offers participants the ability to build theirleadership skills through practical experiences and knowledge sharing opportunities with the GroupExecutive. The Group manages a variety of graduate recruitment and training programmes focused ondeveloping the skills of more junior technical employees. We formalised an employee mobilityprogramme to support the knowledge transfer of employees from one region to another region withinthe Group. This programme also supports an employee’s personal development and growth by offeringa work abroad opportunity for our current and future leaders.

ACKNOWLEDGEMENT FROM INDUSTRY LEADERS

Dimension Data’s partnerships with leading IT manufacturers continue to play a key role in theexecution of our strategy. Our understanding of how to make technology work in operational clientenvironments differentiates us in the marketplace. This involves identifying the IT manufacturers thatwill lead their industry sectors and then investing in building the technical skills and expertise so thatDimension Data can offer a superior solution. Being recognised as the best by our IT manufacturingpartners is important because it reflects consistent positive feedback that they receive from their clients


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about our performance. In the first half of FY08 Dimension Data received a record 20 awards fromCisco. In addition, we received several other awards from key partners including McAfee, RSA andNortel. These awards are testament to our ability to partner well for the benefit of our clients.

MOVING FORWARD

Dimension Data’s strategy remains clear and consistent. The markets we target provide attractiveopportunities for growth. The focus of our growth remains primarily organic. In high growth markets,where we believe a direct presence is warranted, we will acquire or partner with local, like-mindedcompanies. We will continue to grow our six global lines of business and attach services to all relatedtechnology sales. Growing our Services revenues remains a priority. Investment in developing ourservices platform, architecture and expanding our service delivery capabilities is vital and on-going.The further expansion of our Managed Services capabilities to allow us to secure more multisourcingopportunities remains important.

The Group’s growth into new markets including emerging Africa, the Middle East, Canada and Mexicohas been successful to date. After a slow start in Brazil, we are optimistic about our prospects. Ourexisting geographical footprint differentiates us and provides strong balance and exciting growthopportunities. We will continue to invest in expanding our capabilities and presence in selectedgeographies.

Deregulation of the telecommunications markets in general, and across Africa specifically, representsan area of significant opportunity to Dimension Data in two key ways. Through Dimension Data andPlessey we offer telecommunications service providers a unique combination of capabilities to assistthem with building and managing their revenue generating networks. Through Internet Solutions, weare a telecommunications service provider in our own right.

From the implementation of basic IP telephony solutions to real-time collaboration, we see theemerging unified communications market as highly attractive. Our historical areas of expertise in ITinfrastructure including networking, IP telephony and IT services, coupled with our growing strengthsin Microsoft technologies, makes the unified communications market ideally suited to us. As the marketopportunity materialises over the next few years we are well positioned to succeed.

We believe environmentally friendly IT solutions will increasingly be a priority for our clients around theworld as they target lower carbon emissions and energy consumption from their IT infrastructure. Weare actively developing solutions like our recently launched power and cooling assessment service andexpanding our offerings in visual communications to help our clients understand and reduce their powerconsumption and travel and, hence, reduce their carbon emissions.

OUTLOOK

Building on our strong progress in H1, the key drivers for our business growth are in place. Whilstrecognising the recent turmoil in financial services, we are optimistic about the remainder of thefinancial year. We believe the economic slowdown in several major markets is having some impact onIT spending. However, Dimension Data is in a strong strategic and operational position, with the benefitof a robust balance sheet. Our strategy remains clear and unchanged and we continuously review ouroperational plans in order to be able to adapt to developing circumstances. We continue to see soliddemand in the market for our industry relevant solutions and service offerings and remain confident thatthe Group is well positioned to drive continued profitable growth.


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Chief Financial Officer’s Review

To review the underlying performance of the business, the following adjustments have been madebelow:

Growth rates, unless otherwise indicated, are in relation to H1 2007, are calculated before eliminatingintercompany revenue and adjusted for the impact of currency movements and the disposal of theGroup’s Swedish operations in the prior year.

Unless specifically indicated, exceptional items are excluded from the analysis.

Income Statement Summary

Revenue for the six months to 31 March 2008 was $2,171 million, an increase of 16.3% over the priorperiod. Revenues from the Americas, Asia and Middle East and Africa were particularly strong, andServices grew by 17.8%. All of the Group’s global lines of business contributed well, with NetworkIntegration’s increase of 16.6% continuing to outperform broader market growth.

Gross profit for the period was $462.2 million, up 19.2%, reflecting a 0.5% improvement in gross marginto 21.3%. Product and Services margins were both firmer, while an improved Services to Product mixalso contributed.

Overheads were contained in relation to revenue growth, increasing by 14.5% to $377.2 million. Of this,variable overheads (including bonuses and sales commission) were up by 19.3% to $58.9 million whilefixed overheads grew by 13.6% to $318.3 million.

Operating profit was strongly up on the prior period to $85.0 million — a year on year increase of 46.0%— and operating margin improved from 3.1% to 3.9%.

The share of results from associates increased to $3.8 million from $3.1 million, while net interest costsreduced to $7.4 million.

Property revaluation and other gains and losses include a gain on revaluation of the investment portionof the Campus property asset of $3.6 million (H1 2007: $13.6 million).

The Group tax charge was $22.9 million, an effective tax rate on profit before tax of 26.6% (2007:28.6%). This improvement was mainly the result of improved profitability from those jurisdictions withinthe Group which are not currently paying tax.

Earnings per share were 3.4 cents per share, an increase of 41.7%.

The only exceptional item reported during the period was a $3.7 million gain on disposal of Automate,a software development company providing solutions to the automotive industry, to Britehouse, aGroup associate.


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Trading and Operations

The revenue and gross margin in the tables below are as reported, whereas the growth rates arecalculated before eliminating intercompany revenue and adjusted for the impact of currencymovements and the disposal of the Group’s Swedish operations in the prior year.

Lines of businessH1 2008

$’000 Growth Revenue streamsH1 2008

$’000 Growth

Network Integration 1,012,417 16.6% Product 1,318,159 15.4%

Global lines of business 715,535 21.6% Managed Services 512,995 18.4%

Regional 443,260 10.0% Professional Services 340,058 17.0%

Total 2,171,212 16.3% Total 2,171,212 16.3%

Regional performance

$’000 Americas Asia Australia Europe

MiddleEast &Africa

Central&

Other* Total

H1 2008

Revenue 346,560 353,787 440,803 564,581 456,297 9,184 2,171,212

Growth % 24.2 29.8 6.8 11.6 19.9 16.3

Product 272,652 225,730 324,887 351,166 139,483 4,241 1,318,159

Growth % 27.9 29.0 1.5 9.6 33.0 15.4

Services 73,908 128,057 115,916 213,415 316,814 4,943 853,053

Growth % 12.4 31.3 28.8 15.1 14.9 17.8

Gross margin % 15.7 18.5 19.0 20.5 28.2 21.3

Operating profit 8,431 23,481 19,164 8,109 40,432 (14,601) 85,016

Operating margin % 2.4 6.6 4.3 1.4 8.9 3.9

Restated**

H1 2007

Revenue 277,977 272,513 358,903 470,046 379,764 10,937 1,770,140

Product 212,131 174,995 279,233 299,016 106,751 3,048 1,075,174

Services 65,846 97,518 79,670 171,030 273,013 7,889 694,966

Gross margin % 15.9 18.9 18.3 20.5 27.1 20.9

Operating profit 5,524 16,606 13,059 4,284 30,679 (15,120) 55,032

Operating margin % 2.0 6.1 3.6 0.9 8.1 3.1

* Includes Central management costs, net of Central trading and Campus income.

** Restated for the reallocation of the Campus from ‘Middle East and Africa’ to ‘Central and Other’ and the reallocation ofcertain African revenues from Product to Services.


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Regions

The Americas region, which incorporates our operations in the US, Canada, Mexico and Brazil, grewrevenues by 24.2% and operating profit expanded by 49.7% to $8.4 million. This growth reflects verystrong performances in Security, Data Centre and Storage (DCS) and particularly in NetworkIntegration where our focus on the network refresh opportunity with our clients compensated for a moredifficult economic environment. Growth was particularly solid within our multinational client base. Goodcontributions were reported by Canada and Mexico, although Brazil disappointed. Gross margins werestable, with a much better performance in the period from Professional Services.

The Group’s Asian subsidiary, Datacraft, had a very strong half, with revenues up by 29.8%. Growthwas robust in both Product and Services, although gross margin declined by 0.4% as a result ofpressures on Managed Services costs. By geography, growth was attributable to strong performancesfrom India, New Zealand, Asean and Greater China, offset by a weaker performance from Korea.Overhead growth was contained and operating profit expanded by 41.4% to $23.5 million.

In Australia, revenues grew by 6.8% with operating profit up by 26.9% to $19.2 million. Productrevenues, particularly in Express Data where growth was flat, were impacted by a stronger Australiandollar and by reduced spend from some of our clients. Our Network Integration business had anexcellent half. Managed Services grew by 22.3% on the back of contract wins and ProfessionalServices were up by 30.8% at improved margins, reflecting solid demand as well as successful effortsto improve delivery efficiencies and processes. Overhead containment ensured an improvement in theoperating margin to 4.3% from 3.6% in H1 2007. We acquired the remaining minority interest in SQLServices, a Group subsidiary providing Microsoft-related solutions.

Europe recorded revenue growth of 11.6% and gross margin improved slightly to 20.5%, a good resultin an environment of ongoing industry consolidation, currency strength and some weakness in thefinancial services sector. Overhead growth was 10.5% and as a result operating profit expanded from$4.3 million in the prior period to $8.1 million. The Security, Converged Communications, DCS andCustomer Interactive Solutions (CIS) lines of business all performed very strongly. Services revenueswere up by 15.1%, reflecting growth in both Managed and Professional Services. While ManagedServices margins declined in the face of pricing pressure and increased costs, Professional Servicesmargins improved significantly. Notable performances were recorded by Germany, the UK and theBenelux countries.

Middle East and Africa’s revenues grew by 19.9% to $456.3 million, and operating profit expandedfrom $30.7 million to $40.4 million at a margin of 8.9%. All four key components of the business —Dimension Data, Plessey, Internet Solutions and Merchants — performed well.

The Dimension Data brand business grew by 26.6%. Growth on the African continent and in the MiddleEast gained momentum, while South Africa remains the key contributor. Strong performances wererecorded by the Network Integration, Converged Communications and Security lines of business, aswell as from the cabling division. By revenue stream, Product sales were up by 33.0% and Services by14.9%. Results from the Professional Services division were much improved, while lower ManagedServices margins were reported for the period.

Plessey’s revenues declined by 4.9% compared to a very strong revenue performance in thecomparable period, but gross profit was up strongly by 45.4%. This reflected a change in mix ofrevenues in favour of more profitable territories, as well as some benefit during the period from aweaker South African Rand. The business continues to enjoy significant opportunities in South Africa,particularly in the rollout of fibre infrastructure, and in the provision of mobile infrastructure servicesthroughout Africa.


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Internet Solutions (IS) delivered another strong performance, expanding revenues by 29.6%, withgross margins remaining stable. Demand in the core internet access, Virtual Private Network andhosting lines of business was robust. IS’s African operations also expanded, supported by theacquisition at the end of the period of Accelon, a broadband communications service provider operatingin Nigeria and in Ghana.

Merchants South Africa had a good half, with continued demand for its outsourced call centre offeringsleading to revenue growth of 12.5% for the half year.

In Central and Other, net costs reduced from $15.1 million to $14.6 million. Within this, the contributionfrom the Campus property was up by 25.8% for the period to $8.3 million, reflecting firmer rental ratesand near full occupation. Central management costs, net of trading income, increased by 10.0% to$22.9 million. Apart from the normal holding company costs, the Group continued to invest in itsServices and Lines of Business strategies, and in the standardisation of Group-wide systems andprocesses.

Lines of Business

The Group’s Network Integration line of business grew by 16.6%, extending the strong performancereported last year and retaining our global leadership in the plan, build, support and management ofnetworks. Growth was underpinned by the refresh cycle and supported by our investment in newtechnologies, including wireless networks to support mobility, performance optimisation to improve theperformance of services and applications over networks, and operations management to drive servicesefficacy and service level adherence.

Security had an excellent half, growing by 35.6%. Security technology continues to permeate allaspects of the corporate infrastructure, including the network, the data centre, the desktop and mobiledevices. This is increasingly important as organisations seek to enable convergence and morecollaborative and mobile business models.

The security industry remains characterised by multiple technologies and vendors, and the Group isextremely well positioned to provide integrated solutions to local and multinational clients.

Converged Communications grew by 20.9%, as mainstream adoption of IP-based telephonycontinued. Growth was supported by our ongoing investment in enhancing our IP telephonydeployment methodologies and managed IP telephony services. Visual communications solutions werean increasing component of this line of business.

The Microsoft Solutions line of business grew by 15.4%, with strong performances in Africa andAustralia. The gross profit contribution from this line of business was significantly higher, a result ofincreased professional services business in these two regions. In addition, our recent investments inAsia and the UK are starting to show encouraging signs of growth and sustainability. The Group hasseen a considerable increase in clients piloting and deploying Unified Communications solutions andhas consequently benefited from projects upgrading and managing core Microsoft infrastructure. Thiscombined with the accelerated deployment of Microsoft Vista means that the Group is well positionedto benefit from its investments in this line of business.

The CIS line of business was up by 13.7%. The continued migration to IP-based contact centres, thedemand for process improvement solutions and the consolidation of vendor platforms positions theGroup well to benefit from growth in this market. The results for the half were mixed, with Africa, Europe


96

and Asia performing strongly, while Australia was disappointing. Merchants, the outsourcing businessperformed well, particularly in South Africa.

Our DCS line of business grew by 16.6% fuelled by demand for our server virtualisation, storageconsolidation, and backup and recovery solutions. The line of business was also supported byincreased interest in ‘green IT’ solutions as clients investigate ways to reduce the carbon footprint oftheir data management infrastructure.

Revenue Streams

Product revenues grew by 15.4%, supported by solid growth across all of our lines of business andgross margins were firmer. By geography, growth in the Americas, Middle East and Africa, and Asia wasmost pronounced, while in Europe and Australia growth was in single digits. Good demand wasexperienced in the public sector and service provider segments, while the financial services segmentwas resilient despite challenging macro economic conditions. In addition, our offerings to multinationalclients continued to expand and to differentiate us in the marketplace.

Services growth of 17.8% reflected strong performances in all regions. Growth in Managed andProfessional Services of 18.4% and 17.0% respectively, was supported by good contributions from theregional services businesses, including Internet Solutions.

Managed Services growth was particularly strong in Africa, Asia and Australia, reflecting the ongoingstrength of the Dimension Data offering in the market place. Changing buying patterns within our clientstowards the selective outsourcing of distinct elements of their infrastructure, as well as the introductionof new Managed Services offerings, drove growth. Managed Services margins were lower for theperiod, as the Group was less able to pass on increased costs to its clients in tougher economicconditions.

Professional Services growth across the board was coupled with a strong improvement in grossmargin, the result of a focused effort to improve processes and efficiencies in the delivery ofProfessional Services engagements. This resulted in improved project management, better utilisationof resources and reduced attrition rates within the organisation.

Share of Profit of Associates

The share of profit of associates increased to $3.8 million from $3.1 million in 2007.

Good contributions were made by Dataflo, Marpless and Britehouse.

Interest Income and Finance Costs

The Group earned interest of $6.5 million (H1 2007: $5.5 million) on its cash holdings, which were$396.7 million at 31 March 2008 (31 March 2007: $357.0 million). Total finance costs were $15.3 million(H1 2007: $13.6 million), including $12.0 million (H1 2007: $11.2 million) on the capitalised propertyfinance lease in South Africa.

Property Revaluation and Other Gains and Losses

Based on the Directors’ assessment of fair value at 31 March 2008, a gain on revaluation of theinvestment portion of the Campus of $3.6 million (H1 2007: $13.6 million) was recorded.


97

A similar revaluation arose in H1 2007, which was previously disclosed as exceptional, has beenrestated as a normal gain, consistent with the treatment for the full year in 2007.

Acquisitions and Disposals

During the period, the Group concluded a few small acquisitions, none of which were material. OurAsian subsidiary acquired a small security practice in New Zealand. In Australia, we acquired Viiew, anIT recruitment and resourcing company, and the remaining minority interest in SQL Services, aMicrosoft solutions provider. In Africa we acquired Accelon, a broadband communications serviceprovider operating in Nigeria and in Ghana.

Automate, a software development company providing solutions to the automotive industry, was soldto Britehouse during the period.

Balance Sheet

Non-current assets

Capital expenditure on property, plant and equipment (net of disposals) was $39.9 million, comparedto $25.3 million in the same period last year. The biggest increase came from South Africa, whereInternet Solutions invested in its network as a consequence of growth in its client base and to upgradeits voice capabilities. Dimension Data in South Africa refreshed its network, invested in powergeneration facilities at the Campus to support increased demand and in land adjacent to the Campusto be used for future expansion.

In addition, Merchants in the UK invested in the establishment of a stand-alone IP call centre hostingcapability.

Capex Depreciation

$ million

Six monthsended

March 2008

Six monthsended

March 2007Year endedSept 2007

Six monthsended

March 2008

Six monthsended

March 2007Year endedSept 2007

Americas 1 1 3 1 1 2

Asia 4 5 8 4 3 8

Australia 3 1 4 3 2 4

Europe 6 2 8 3 4 8

ME&A, excluding IS 8 5 4 5 4 3

Internet Solutions 16 12 31 9 6 16

Central and Other 2 – – 1 – 6

Group 40 26 58 26 20 47

Long term trade and other receivables increased to $49.4 million from $36.8 million at the end of lastyear as a result of the upfront purchase of vendor support services associated with multi-year managedservices contracts, mainly in the UK and the US.


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Current assets

The 6.1% year on year increase in inventories to $198.5 million (H1 2007: $187.0 million) is a goodresult given the much higher revenue growth in the business. This reflects ongoing focus on inventorymanagement, but also lower revenue growth in some of the inventory intensive businesses, notablyExpress Data. Trade and other receivables grew by 24.7%, with trade receivables themselves up by27.6%. This reflects weaker than expected collections at period end in the US, Australia, the UK andItaly, which have been largely resolved subsequent to period end.


Obligations under finance lease of $132.9 million relate predominantly to the property finance lease inSouth Africa. Other long term liabilities of $42.2 million, up from $31.2 million at the end of last year,include vendor financing relating to the purchase of vendor services for long term maintenancecontracts, mainly in the UK and the US.

Current liabilities

Trade and other payables of $1,230.9 million, were up 20.5% compared to 31 March 2007. Tradepayables themselves of $452.3 million were up 19.3%, in line with the increase in revenue. There wereno material changes in the underlying payment terms with our vendors.

Cash Flow

Net cash from operating activities was $40.1 million (H1 2007: $56.2 million). The increase in networking capital of $58.9 million was the result of a higher growth in trade and other receivables than intrade and other payables, offset by lower growth in inventories. While we expect some seasonalincrease in working capital in the first half, the investment in working capital does reflect weakerreceivables collections in a few territories at the end of the period. A significant portion of the collectiondelays were resolved subsequent to period end.

The Group used $41.9 million in investing activities, including $39.9 million of capital expenditure onproperty, plant and equipment and intangibles, and $4.9 million on acquisitions.

In addition, $26.8 million was invested in shares in the Employee Share Trust to settle employee shareincentive obligations. This resulted in a net decrease in share capital and share premium of $6.9 million.

At the end of the year, cash and cash equivalents were $396.7 million compared to $459.2 million at30 September 2007, while bank overdrafts decreased from $3.4 million to $1.0 million.

Principal Risks and Uncertainties

The principal risks and uncertainties which could impact the Group for the remainder of the currentfinancial year are those detailed on pages 23 and 24 of the Group’s 2007 Annual Report. The identifiedrisks are: execution and delivery, people retention, currency, vendor, liquidity, business continuity andnew product and technology. A copy of the Group’s 2007 Annual Report is available on our website atwww.dimensiondata.com. Additional operational risk factors which could impact the Group areaddressed in the Chief Executive Officer’s Review. These include: uncertain global market conditions,the extent of future IT Infrastructure spend and growth in the financial services sector.


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Exchange rates

The following table reflects the average and period end exchange rates against the US dollar for SArand, Australian dollar, Sterling and Euro:

Six months ended31 March 2008


Year ended30 September 2007

AveragePeriod

End AveragePeriod

End AveragePeriod

End

Australian dollar 1.105 1.090 1.278 1.237 1.229 1.126

Euro 0.669 0.633 0.772 0.749 0.746 0.701

South African rand 7.244 8.123 7.273 7.256 7.142 6.871

Sterling 0.495 0.501 0.518 0.508 0.509 0.488


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CONDENSED CONSOLIDATED INCOME STATEMENT

For the six months ended 31 March 2008

Six monthsended

31 March2008

Six monthsended

31 March2007

Year ended30 September

2007Notes $’000 $’000 $’000

Revenue 2 2,171,212 1,770,140 3,773,156

Cost of sales (1,709,002) (1,399,873) (2,960,169)

Gross profit 462,210 370,267 812,987

Administrative, selling and distribution expenses (377,194) (321,842) (689,120)

Operating profit 85,016 48,425 123,867

Share of results of associates 3,751 3,103 5,740

Interest and investment income 7,841 5,480 15,446

Finance costs (15,276) (13,559) (30,315)

Property revaluation and other gains and losses 8,456 13,141 35,767

Profit before tax 89,788 56,590 150,505

Tax 4 (22,885) (14,260) (36,034)

Profit for the period 66,903 42,330 114,471

Attributable to:

– Equity shareholders of the parent 55,881 32,613 92,528

– Minority shareholders 11,022 9,717 21,943

66,903 42,330 114,471

Earnings per ordinary share: US cents US cents US cents

– Basic 6 3.7 2.1 6.0

– Diluted 6 3.4 2.0 5.6


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CONDENSED CONSOLIDATED BALANCE SHEET

As at 31 March 2008

Six monthsended

31 March2008

Six monthsended

31 March2007


2007Notes $’000 $’000 $’000

Non-current assets

Property, plant and equipment 161,207 145,552 165,014

Investment property 80,156 79,670 92,805

Goodwill 95,414 84,826 90,557

Other intangible assets 11,807 13,630 16,914

Investments in associates 33,708 20,999 30,381

Other investments 4,753 7,627 6,971

Deferred tax assets 40,386 28,101 41,248

Trade and other receivables 7 49,432 47,539 36,804

476,863 427,944 480,694

Current assets

Inventories 198,472 187,012 192,658

Trade and other receivables 7 1,070,609 858,441 1,003,554

Cash and cash equivalents 396,716 357,038 459,197

1,665,797 1,402,491 1,655,409

TOTAL ASSETS 2,142,660 1,830,435 2,136,103

Equity

Equity attributable to equity shareholdersof the parent 560,701 491,838 561,947

Minority interests 130,473 105,881 128,242

Total equity 691,174 597,719 690,189


Bank loans 4,034 3,509 4,144

Other long term liabilities 42,156 27,581 31,207

Obligations under finance leases 132,944 139,033 149,919

Deferred tax liabilities 1,773 1,493 2,295

Provisions 8,568 6,258 9,517

189,475 177,874 197,082

Current liabilities

Trade and other payables 8 1,230,913 1,021,454 1,213,153

Bank loans 14,869 22,589 20,475

Bank overdrafts 1,022 5,337 3,439

Provisions 15,207 5,462 11,765

1,262,011 1,054,842 1,248,832

Total liabilities 1,451,486 1,232,716 1,445,914

TOTAL EQUITY AND LIABILITIES 2,142,660 1,830,435 2,136,103


102

CONDENSED CONSOLIDATED CASH FLOW STATEMENT


Six monthsended

31 March2008

Six monthsended

31 March2007


2007*$’000 $’000 $’000

Cash flows from operating activitiesOperating profit 85,016 48,425 123,867Adjustments for:

Depreciation and amortisation 30,174 23,054 52,680Movement in provisions 2,218 2,305 9,492Share-based payment expensed 9,211 9,212 24,457Other non-cash items (1,620) (993) 2,684

Operating cash flows before movements in working capital 124,999 82,003 213,180(Increase)/decrease in inventories (6,869) (4,518) 1,349Increase in trade and other receivables (78,687) (68,930) (168,037)Increase in trade and other payables 26,686 69,073 185,837

Cash generated from operations 66,129 77,628 232,329Income taxes paid (13,385) (11,007) (30,619)Interest paid (12,683) (10,439) (24,609)

Net cash from operating activities 40,061 56,182 177,101

Cash flows from investing activitiesInterest received 7,841 5,274 15,445Net investment in business interests and intangible assets (4,932) (5,855) (1,240)Acquisition of property, plant and equipment, net of proceeds

on disposal (39,890) (25,303) (59,712)Treasury share buy back by a subsidiary (1,169) (4,762) (6,854)Deferred consideration paid (3,748) (5,500) (5,500)

Net cash used in investing activities (41,898) (36,146) (57,861)

Cash flows from financing activitiesShares purchased by Employee Share Trust (26,774) – (25,476)Repayment of borrowings (4,962) (3,776) (7,338)New bank loans and finance leases 4,507 2,885 16,476Dividends paid to ordinary shareholders (23,282) (15,170) (15,170)Dividends paid to minorities (9,366) (9,896) (10,602)Proceeds on issue of new shares net of expenses 2,907 2,757 6,712

Net cash used in financing activities (56,970) (23,200) (35,398)

Net movement in cash and cash equivalents (58,807) (3,164) 83,842Cash and cash equivalents at beginning of period 455,758 341,673 341,673Exchange differences on cash and cash equivalents (1,257) 13,192 30,243

Cash and cash equivalents at end of period 395,694 351,701 455,758

Cash and cash equivalents is made up as follows:Cash and cash equivalents 396,716 357,038 459,197Bank overdrafts (1,022) (5,337) (3,439)

395,694 351,701 455,758

* Restated

Cash flows on shares purchased by the Employee Share Trust have been reclassified in FY2007 from investing to financingactivities to more accurately reflect their nature.


103

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Sharecapital

andPremium

Totalother

reserves*Retainedearnings

Attributableto equityholders

of parentMinorityinterests

Totalequity

$’000 $’000 $’000 $’000 $’000 $’000

1 October 2006 214,929 200,597 22,022 437,548 105,540 543,088

Profit for the period – – 32,613 32,613 9,717 42,330

Items recognised directly inequity 2,757 38,611 (19,691) 21,677 (9,376) 12,301

Share incentive schemes – 7,338 – 7,338 – 7,338

Currency adjustments – 24,601 – 24,601 144 24,745

Deferred tax arising onrevaluation of loans – 589 – 589 – 589

Dividends paid – – (15,170) (15,170) (9,896) (25,066)

Shares issued 2,757 – – 2,757 – 2,757

Subsidiaries acquired/changesin holdings – – – – 347 347

Net losses on cash flowhedging – (2,046) – (2,046) – (2,046)

Revaluation of investmentproperty – 5,584 – 5,584 – 5,584

Deferred tax on revaluation ofinvestment property – (1,619) – (1,619) – (1,619)

Other – (710) 353 (357) 29 (328)

Transfers – 4,874 (4,874) – – –

31 March 2007 217,686 239,208 34,944 491,838 105,881 597,719


104

Sharecapital

andPremium

Totalother




Totalequity

$’000 $’000 $’000 $’000 $’000 $’000

1 October 2006 214,929 200,597 22,022 437,548 105,540 543,088


Items recognised directly inequity (18,764) 61,106 (10,471) 31,871 759 32,630


Deferred tax on share incentiveschemes – 7,336 – 7,336 – 7,336

Share option reserve utilised – (1,020) – (1,020) – (1,020)

Currency adjustments – 52,467 – 52,467 441 52,908

Deferred tax arising onrevaluation of loans – (471) – (471) – (471)

Dividends paid – – (15,170) (15,170) (10,600) (25,770)

Shares issued 6,712 – – 6,712 – 6,712

Shares held in employee trust (25,476) – – (25,476) – (25,476)

Subsidiaries acquired/changesin holdings – 262 – 262 3,645 3,907

Vesting under BEE scheme – (8,260) – (8,260) 8,260 –

Revaluation of investmentproperty – 5,756 – 5,756 – 5,756

Deferred tax on revaluation ofinvestment property – (1,669) – (1,669) – (1,669)

Movement in investmentvaluations – 255 – 255 – 255

Transfers to income statement – (4,260) – (4,260) – (4,260)

Other – (172) – (172) (987) (1,159)

Transfers – (4,699) 4,699 – – –

30 September 2007 196,165 261,703 104,079 561,947 128,242 690,189


105

Sharecapital

andpremium

Totalother




Totalequity

$’000 $’000 $’000 $’000 $’000 $’000

1 October 2007 196,165 261,703 104,079 561,947 128,242 690,189


Items recognised directly inequity (3,972) (14,575) (38,580) (57,127) (8,791) (65,918)


Deferred tax on share incentiveschemes – 1,307 – 1,307 – 1,307

Settlement of share schemes – (7,556) (12,866) (20,422) – (20,422)

Currency adjustments – (20,902) – (20,902) (1,517) (22,419)

Deferred tax arising onrevaluation of loans – 415 – 415 – 415

Dividends paid – – (23,282) (23,282) (4,244) (27,526)

Shares issued 2,907 – – 2,907 – 2,907

Net movement in sharesheld in employee trust (6,879) – – (6,879) – (6,879)

Subsidiaries acquired/changesin holdings – – – – (3,030) (3,030)

Net gains on cash flowhedging – 2,429 – 2,429 – 2,429

Movement in investmentvaluations – (429) – (429) – (429)

Transfers to income statement – 291 – 291 – 291

Other – (84) – (84) – (84)

Transfers – 2,432 (2,432) – – –

31 March 2008 192,193 247,128 121,380 560,701 130,473 691,174

* Other reserves principally comprise consolidation reserves arising prior to the unbundling of the underlying assets into theCompany at the time of its LSE listing in 2000.


106

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


1. BASIS OF PREPARATION

Statutory financial information

The unaudited interim results have been prepared in accordance with accounting policies andmethods of computation based on International Financial Reporting Standards (IFRS’s) asadopted by the European Union, and presented in terms of IAS 34 ‘Interim Financial Reporting’which has been applied for the first time. The unaudited interim results have been prepared on abasis consistent with the accounting policies set out in the Dimension Data Holdings plc AnnualReport for the year ended 30 September 2007, with the following exceptions:

• IFRS 7 ‘Financial Instruments: Disclosures’. This standard was adopted from 1 October2007. This has not had an impact on measurement, but will necessitate additionaldisclosures as prescribed by the standard to be reflected in the 2008 Annual Report.

• IFRIC 11 ‘IFRS 2: Group and Treasury Share Transactions’. This interpretation was adoptedfrom 1 October 2007 and has not had a material effect on the Group.

The tax charge on underlying business performance is calculated by reference to the estimatedeffective tax rate for each jurisdiction for the full year 2008. Tax on disposal and exceptional itemsis based on the expected tax impact of each item.

The preparation of the interim financial statements in conformity with the Group’s accountingpolicies requires the Directors to make estimates and assumptions that affect the reportedamounts of assets and liabilities, and disclosure of contingent assets and liabilities at the balancesheet date, and the reported amounts of revenue and expenses during the reported period. Whilstthese estimates and assumptions are based on the Directors’ best knowledge of the amount,events or actions, actual results may differ from those estimates.

The unaudited interim condensed consolidated financial statements for the six months ended 31March 2008, which were approved by the Board of Directors on 13 May 2008 and which includecertain comparative information with respect to the year ended 30 September 2007, do notconstitute statutory accounts within the meaning of section 240 of the Companies Act 1985 (‘theAct’). Full accounts for the year ended 30 September 2007, prepared in accordance withInternational Financial Reporting Standards, incorporating an unqualified independent auditors’report, have been filed with the Registrar of Companies and did not contain a statement undersection 237(2) or (3) of the Act.

The Group has a balance of businesses globally. Historically, the Northern hemisphere operationshave, ignoring underlying growth trends, reflected a bias of trading towards the first half of thefinancial year, and our Southern hemisphere businesses towards the second half. In recentperiods, at a Group level, on balance there has been a slight bias in trading towards the secondhalf of the year, although there is no guarantee that in an uncertain economic environment thistrend will continue.

Copies of this report are being sent to shareholders, and are available to the public at theCompany’s registered office, Fleet Place House, 2 Fleet Place, London EC4M 7RT.


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2. SEGMENTAL ANALYSIS

Americas Asia Australia Europe

MiddleEast &Africa

Central &other*

Inter-Company

sales Total

$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000


Revenue 349,261 353,787 511,303 577,377 511,794 12,169 (144,479) 2,171,212

Operating profit 8,431 23,481 19,164 8,109 40,432 (14,601) – 85,016


Revenue** 279,889 272,513 413,972 480,465 426,636 6,808 (110,143) 1,770,140

Operating profit*** 5,524 16,606 13,059 4,284 30,679 (15,120) – 55,032

Twelve months ended30 September 2007

Revenue 585,043 580,829 912,004 981,683 931,582 16,065 (234,050) 3,773,156

Operating profit*** 17,398 36,456 29,169 8,522 70,877 (31,428) – 130,994

* Includes Central management costs, net of Central trading and Campus income.

** Restated for certain inter-company revenue in line with treatment for the full year.

*** Before exceptional items.


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3. EXCEPTIONAL INCOME/(COSTS)

Six monthsended

31 March2008

Six monthsended

31 March2007


2007Note $’000 $’000 $’000

Exceptional operating costs

Foreign exchange loss on loans – (6,607) (6,617)

Other – – (510)

Total exceptional operating costs – (6,607) (7,127)

Other exceptional gains and losses (a) 3,691 – 13,736

Exceptional tax

Deferred tax credit – 3,817 4,197

Capital gains tax on sale of shares

Tax on withholding costs refund – – (2,055)

– – (965)

Total exceptional tax – 3,817 1,177

Exceptional items after tax 3,691 (2,790) 7,786

Minorities’ share – (1,244) (1,354)

Net exceptional income/(costs) 3,691 (4,034) 6,432

(a) Profit on sale of the Group’s 92.3% interest in Automate to Britehouse (see Note 9). Theamount in respect of 30 September 2007 includes the profit on sale of subsidiaries.

At the interim to 31 March 2007, the revaluation of the Campus property was disclosed asexceptional. However for the full year ended 30 September 2007 the amount was disclosedas a normal gain, as such revaluations are likely to be a recurring feature of the Group’sresults. As a consequence the results to 31 March 2007 have been restated.

Reconciliation of reported amounts to adjusted amounts

Six monthsended

31 March2008

Six monthsended

31 March2007


2007$’000 $’000 $’000

Statutory operating profit 85,016 48,425 123,867

Exceptional operating costs – 6,607 7,127

Adjusted operating profit 85,016 55,032 130,994


109

Six monthsended

31 March2008

Six monthsended

31 March2007


2007$’000 $’000 $’000

Statutory attributable profit after tax 55,881 32,613 92,528

– Exceptional operating costs – 6,607 7,127

– Other exceptional gains and losses (3,691) – (13,736)

– Exceptional tax credits – (3,817) (1,177)

– Minorities’ share – 1,244 1,354

Adjusted attributable profit after tax 52,190 36,647 86,096

4. TAXSix months

ended31 March

2008

Six monthsended

31 March2007


2007$’000 $’000 $’000

Current tax 23,692 11,556 37,715

Deferred tax – current period (3,098) 6,697 854

Deferred tax – prior periods* 2,291 (3,993) (2,535)

Total tax expense 22,885 14,260 36,034

This expense relates predominantly to tax jurisdictions outside of the United Kingdom.

5. DIVIDENDS PER SHARE

A final dividend of 1.5 cents per share was paid on 14 March 2008. No interim dividend isproposed.

6. EARNINGS PER SHARESix months

ended31 March

2008

Six monthsended

31 March2007


2007’000 ’000 ’000

Weighted average number of ordinary shares:

– for basic earnings per share 1,526,817 1,542,114 1,539,744

– for diluted earnings per share 1,650,092 1,648,975 1,657,256

$’000 $’000 $’000

Earnings for basic and diluted earnings per share 55,881 32,613 92,528

Exceptional items (3,691) 4,034 (6,432)

Adjusted earnings 52,190 36,647 86,096


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Six monthsended

31 March2008

Six monthsended

31 March2007


2007US Cents US Cents US Cents

Basic earnings per share 3.7 2.1 6.0

Diluted earnings per share 3.4 2.0 5.6

Adjusted basic earnings per share 3.4 2.4 5.6

Adjusted diluted earnings per share 3.2 2.2 5.2

The weighted average number of ordinary shares in issue excludes the shares held by theEmployee Share Trust.

7. TRADE AND OTHER RECEIVABLES

31 March2008

31 March2007

30 September2007

$’000 $’000 $’000

Trade receivables 832,847 652,617 767,654

Other receivables 105,968 92,503 96,916

Prepayments and accrued income 157,866 141,374 143,075

Taxation authorities 23,360 19,486 32,713

1,120,041 905,980 1,040,358

Analysed as follows:

Long term portion 49,432 47,539 36,804

Short term portion 1,070,609 858,441 1,003,554

1,120,041 905,980 1,040,358

8. TRADE AND OTHER PAYABLES

31 March2008

31 March2007

30 September2007

$’000 $’000 $’000

Trade payables 452,314 379,168 448,828

Other payables 164,356 149,028 178,555

Accruals 282,235 204,382 266,741

Deferred income 200,936 177,733 188,625

Deferred consideration – 2,476 1,712

Taxation authorities 131,072 108,667 128,692

1,230,913 1,021,454 1,213,153


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9. ACQUISITIONS AND DISPOSALS

With effect from 1 February 2008 the Group disposed of its 92.3% interest in Automate toBritehouse for a total consideration of $15.4 million, settled partly in cash and partly in shares.

During the period, the Group made several small acquisitions of subsidiaries for an aggregateconsideration of $10.6 million, with $14.2 million recognised as goodwill on acquisition. The totalassets and liabilities, in aggregate for these acquisitions amounted to $7.1 million and $10.7million, respectively. These did not have a significant impact on the reported results.

10. POST BALANCE SHEET EVENTS

There have been no material events requiring disclosure after balance sheet date and up to thedate of approval of these financial statements.

11. CONTINGENT ASSETS AND LIABILITIES

The Group is subject to various claims and litigation which arise in the ordinary course ofbusiness. Each claim is evaluated by management, together with their legal advisers, and adecision is made on whether financial settlement is probable, in which case appropriate provisionshave been made. The Directors believe that, subject to a reasonable outcome on the matters stillto be determined, the provisions are sufficient to meet the likely outcomes of such claims.

There is an ongoing legal claim in South Africa where the plaintiff is claiming $17.9 million andinterest for an issue that dates back to 2001. The case has two elements, merit and quantum, anda trial date has now been set for November 2008 to hear the merit case. Based on our legaladvice, the Group continues to believe that the claim is without merit and will vigorously defendits position. Accordingly no provision has been made for this claim.

12. RELATED PARTY TRANSACTIONS

During the interim period the Group sold its 92.3% interest in Automate to Britehouse, in which theGroup holds an effective 40% interest. VenFin Limited, a shareholder of Dimension Data Holdingsplc, holds an effective 30% interest in Britehouse and a BEE consortium owns the remaining 30%.Moss Ngoasheng, a director of Dimension Data Holdings plc, is an indirect shareholder of theconsortium.

There were no other changes during the period in the related party transactions described in thelast Annual Report that could have a material effect on the financial position or performance of theGroup.


112

13. JSE LIMITED REQUIREMENTS

Disclosure of headline earnings per share is a requirement for entities listed on the JSE Limitedin South Africa and as a result, the Group has calculated and presented a headline earningsreconciliation below. Headline earnings are arrived at in terms of the guidance in Circular 8/2007issued by the South African Institute of Chartered Accountants.

Six monthsended

31 March2008

Six monthsended

31 March2007


2007’000 ’000 ’000

Weighted average number of ordinary shares:

– for headline earnings per share 1,526,817 1,542,114 1,539,744

– for diluted headline earnings per share 1,650,092 1,648,975 1,657,256

$’000 $’000 $’000

Earnings for basic and diluted earnings per share 55,881 32,613 92,528

Adjustments for headline earnings (6,112) (7,906) (27,075)

Headline earnings 49,769 24,707 65,453

US Cents US Cents US Cents

Headline earnings per share 3.3 1.6 4.3

Diluted headline earnings per share 3.0 1.5 3.9

The adjustments for headline earnings include the revaluation of the Campus investmentproperty, profits and losses on the sale of subsidiaries and the loss on sale of property, plant andequipment, net of tax and minorities.

CAUTIONARY STATEMENT

This Interim Management Report (‘IMR’) has been prepared solely to provide additionalinformation to shareholders to assess the Group’s strategies and the potential for thosestrategies to succeed. The IMR should not be relied on by any other party or for any otherpurpose.

The IMR contains certain forward-looking statements. These statements are made by theDirectors in good faith based on the information available to them up to the time of theirapproval of this report and such statements should be treated with caution due to the inherentuncertainties, including both economic and business risk factors, underlying any suchforward-looking information.


113

STATEMENT OF DIRECTORS’ RESPONSIBILITIES

We confirm that to the best of our knowledge:

(a) the condensed set of financial statements which has been prepared in accordance with IAS 34,gives a true and fair view of the assets, liabilities, financial position and profit of Dimension DataHoldings plc, as required by DTR 4.2.4R;

(b) the interim management report includes a fair review of important events during the first sixmonths and a description of the principal risks and uncertainties for the remaining six months ofthe year, as required by DTR 4.2.7R; and

(c) the interim management report includes a fair review of the disclosure of related parties’transactions and changes therein, as required by DTR 4.2.8R.

By order of the Board

Brett Dawson Dave SherriffsChief Executive Officer Chief Financial Officer

13 May 2008


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INDEPENDENT REVIEW REPORT TO DIMENSION DATA HOLDINGS PLC

We have been engaged by the Company to review the condensed set of financial statements in thehalf-yearly financial report for the six months ended 31 March 2008 which comprises the condensedconsolidated income statement, the condensed consolidated balance sheet, the condensedconsolidated statement of changes in equity, the condensed consolidated cash flow statement andrelated notes 1 to 13. We have read the other information contained in the half-yearly financial reportand considered whether it contains any apparent misstatements or material inconsistencies with theinformation in the condensed set of financial statements.

This report is made solely to the Company in accordance with International Standard on ReviewEngagements (UK and Ireland) 2410 issued by the Auditing Practices Board. Our work has beenundertaken so that we might state to the Company those matters we are required to state to them inan independent review report and for no other purpose. To the fullest extent permitted by law, we donot accept or assume responsibility to anyone other than the Company, for our review work, for thisreport, or for the conclusions we have formed.

Directors’ responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the Directors. TheDirectors are responsible for preparing the half-yearly financial report in accordance with the Disclosureand Transparency Rules of the United Kingdom’s Financial Services Authority.

As disclosed in note 1, the annual financial statements of the Group are prepared in accordance withIFRS’s as adopted by the European Union. The condensed set of financial statements included in thishalf-yearly financial report has been prepared in accordance with International Accounting Standard 34,‘Interim Financial Reporting’, as adopted by the European Union.

Our responsibility

Our responsibility is to express to the Company a conclusion on the condensed set of financialstatements in the half-yearly financial report based on our review.

Scope of Review

We conducted our review in accordance with International Standards on Review Engagements (UKand Ireland) 2410, ‘Review of Interim Financial Information Performed by the Independent Auditor ofthe Entity’ issued by the Auditing Practices Board for use in the United Kingdom. A review of interimfinancial information consists of making inquiries, primarily of persons responsible for financial andaccounting matters, and applying analytical and other review procedures. A review is substantially lessin scope than an audit conducted in accordance with International Standards on Auditing (UK andIreland) and consequently does not enable us to obtain assurance that we would become aware of allsignificant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.


115

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensedset of financial statements in the half-yearly financial report for the six months ended 31 March 2008is not prepared, in all material respects, in accordance with International Accounting Standard 34 asadopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom’sFinancial Services Authority.

Deloitte & Touche LLPChartered Accountants and Registered Auditor13 May 2008LondonUnited Kingdom


116

ANNEX 3

Significant accounting policies of Dimension Data as extracted from Note 2 to the auditedfinancial statements of Dimension Data for FY2007

“2 SIGNIFICANT ACCOUNTING POLICIES

The accounting policies set out below have been used in preparation of the consolidated financialstatements and the Company financial statements where applicable. The consolidated financialinformation has been prepared on the historical cost basis, except for the revaluation of certainfinancial instruments and the investment property. The principal accounting policies adopted areset out below.

Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Company andentities (including special purpose entities) controlled by the Company (its subsidiaries). Controlis achieved where the Company has the power to govern the financial and operating policies ofan investee enterprise so as to obtain benefits from its activities.

The results of subsidiaries acquired or disposed of during the year are included in theconsolidated income statement from the effective date of acquisition or up to the effective date ofdisposal, as appropriate.

Where necessary, adjustments are made to the financial statements of subsidiaries to bring theaccounting policies used into line with those used by other members of the Group.

All intra-group transactions, balances, income and expenses are eliminated on consolidation.

Minority interests in the net assets of consolidated subsidiaries are identified separately from theGroup’s equity therein. Minority interests consist of the amount of those interests at the date of theoriginal business combination and the minority’s share of changes in equity since thecombination. Losses applicable to the minority in excess of the minority’s interest in thesubsidiary’s equity are allocated against the interest of the Group except to the extent that theminority has a binding legal obligation and is able to make additional investment to cover thelosses.

Business combinations

The acquisition of subsidiaries is accounted for using the purchase method. The cost of theacquisition is measured at the aggregate of the fair values, at the date of exchange, of assetsgiven, liabilities incurred or assumed, and equity instruments issued by the Group in exchange forcontrol of the acquiree, plus any costs directly attributable to the business combination.

On acquisition, the assets and liabilities and contingent liabilities of a subsidiary are measured attheir fair values at the date of acquisition, except for non-current assets (or disposal groups) thatare classified as held for sale in accordance with IFRS 5 ‘Non- Current Assets Held for Sale andDiscontinued Operations’, which are recognised and measured at fair value less cost to sell.


117

Any excess of the cost of acquisition over the fair values of the identifiable net assets acquired isrecognised as goodwill. Any deficiency of the cost of acquisition below the fair values of theidentifiable net assets acquired (i.e. discount on acquisition) is credited to the income statementin the period of acquisition.

The interest of minority shareholders in the acquiree is initially measured at the minority’sproportion of the net fair value of the assets, liabilities and contingent liabilities recognised.

Investments in associates

An associate is an entity over which the Group is in a position to exercise significant influence, butnot control, through participation in the financial and operating policy decisions of the investee.

The results and assets and liabilities of associates are incorporated in these financial statementsusing the equity method of accounting except when classified as held for sale (see below).Investments in associates are carried in the balance sheet at cost as adjusted by post-acquisitionchanges in the Group’s share of the net assets of the associate, less any impairment in the valueof individual investments. Losses of the associate in excess of the Group’s interest in thoseassociates are not recognised.

Any excess of the cost of acquisition over the Group’s share of the fair values of the identifiableassets, liabilities and contingent liabilities of the associate at the date of acquisition is recognizedas goodwill. Any deficiency of the cost of acquisition below the Group’s share of the fair values ofthe identifiable net assets of the associate at the date of acquisition (i.e. discount on acquisition)is credited in the income statement in the period of acquisition. The goodwill is included within thecarrying amount of the investment and is assessed for impairment as part of the investment.

Where a Group company transacts with an associate of the Group, profits and losses areeliminated to the extent of the Group’s interest in the relevant associate. Losses may provideevidence of an impairment of the asset transferred, in which case appropriate provision is madefor impairment.

Non-current assets held for sale

Non-current assets (and disposal groups) classified as held for sale are measured at the lower ofcarrying amount and fair value less costs to sell.

Non-current assets and disposal groups are classified as held for sale if their carrying amounts willbe recovered through a sale transaction rather than through continuing use. This condition isregarded as being met only when the sale is highly probable and the asset (or disposal group) isavailable for immediate sale in its present condition. Management must be committed to the salewhich should be expected to qualify for recognition as a completed sale within one year from thedate of classification.

Goodwill

Goodwill arising on consolidation represents the excess of the cost of acquisition over the Group’sinterest in the fair value of the identifiable assets, liabilities and contingent liabilities of a subsidiaryor associate at the date of acquisition.

Goodwill is recognised as an asset at cost and is subsequently measured at cost less anyaccumulated impairment losses.


118

For the purpose of the annual impairment testing, goodwill is allocated to each of the Group’scash-generating units expected to benefit from the combination. Cash-generating units to whichgoodwill has been allocated are tested for impairment annually, or more frequently when there isan indication that the unit may be impaired. If the recoverable amount of the cash-generating unitis less than the carrying amount of the unit, the impairment loss is allocated first to reduce thecarrying amount of any goodwill allocated to the unit and then to the other assets of the unitpro-rata on the basis of the carrying amount of each asset in the unit. Any impairment isrecognised immediately in the income statement and is not subsequently reversed.

On disposal of a subsidiary or associate, the attributable amount of goodwill is included in thedetermination of the profit or loss on disposal.

Goodwill arising on acquisitions before the date of transition to IFRS has been retained at theprevious UK GAAP amounts subject to being tested for impairment at that date. Goodwill writtenoff to reserves under UK GAAP has not been reinstated and is not included in determining anysubsequent profit or loss on disposal.

Revenue recognition

Revenue is measured at the fair value of the consideration received or receivable and representsamounts receivable for goods and services provided in the normal course of business, net ofdiscounts, VAT and other sales related taxes.

Sales of goods are recognised when goods are delivered and title has passed.

Revenue from contracts is recognised in accordance with the Group’s accounting policy oncontracts (see below).

Maintenance revenue and licence fees are brought to account over the relevant contract periods.

Where the Group acts as agent and is remunerated on a commission basis, the commission isincluded in revenue. Where the Group acts as principal, the total value of business handled isincluded in revenue.

Interest income is accrued on a time basis, by reference to the principal outstanding and at theeffective interest rate applicable, which is the rate that exactly discounts estimated future cashreceipts through the expected life of the financial asset to that asset’s net carrying amount.

Dividend income from investments is recognised when the shareholders’ rights to receivepayment have been established.

Contracts

Where the outcome of a contract can be estimated reliably, revenue and costs are recognised byreference to the stage of completion of the contract activity at the balance sheet date. This isnormally measured by the proportion that contract costs incurred for work performed to date bearto the estimated total contract costs, except where this would not be representative of the stageof completion. Variations in contract work, claims and incentive payments are included to theextent that it is probable that they will result in revenue, and they are capable of being reliablymeasured.


119

Where the outcome of a contract cannot be estimated reliably, contract revenue is recognised tothe extent of contract costs incurred that it is probable will be recoverable. Contract costs arerecognised as expenses in the period in which they are incurred.

When it is probable that total contract costs will exceed total contract revenue, the expected lossis recognised as an expense immediately.

Contact centre revenue is recognised according to the stage of completion of the contract byreference to the value of work performed. The amount by which revenue differs from paymentson account is shown under receivables as accrued revenue, or under payables as deferredrevenue, as appropriate.

Leasing

Leases are classified as finance leases whenever the terms of the lease transfer substantially allthe risks and rewards of ownership to the lessee.

All other leases are classified as operating leases.

The Group as lessor

Amounts due from lessees under finance leases are recorded as receivables at the amount of theGroup’s net investment in the leases. Finance lease income is allocated to accounting periods soas to reflect a constant periodic rate of return on the Group’s net investment outstanding in respectof the leases.

Rental income from operating leases is recognised on a straight line basis over the term of therelevant lease. Initial direct costs incurred in negotiating and arranging an operating lease areadded to the carrying amount of the leased asset and recognized on a straight line basis over thelease term.

The Group as lessee

Assets held under finance leases are recognised as assets of the Group at their fair value or, iflower, at the present value of the minimum lease payments, each determined at the inception ofthe lease. The corresponding liability to the lessor is included in the balance sheet as a financelease obligation. Lease payments are apportioned between finance charges and reduction of thelease obligation so as to achieve a constant rate of interest on the remaining balance of theliability. Finance charges are charged directly in the income statement.

Rentals payable under operating leases are charged to income on a straight line basis over theterm of the relevant lease.

Benefits received and receivable as an incentive to enter into an operating lease are also spreadon a straight line basis over the lease term.

Foreign currencies

The individual financial statements of each Group entity are presented in the currency of primaryeconomic environment in which the entity operates (its functional currency). For the purpose ofthe consolidated financial statements, the results and financial position of each entity areexpressed in US dollars, which is the functional currency of the Company, and the presentation


120

currency for the consolidated financial statements. The Group has elected to present its resultsin US dollars as this is the currency predominantly used when the Group transacts.

Transactions in currencies other than the functional currency of the entities are recorded at therates of exchange prevailing on the dates of the transactions. At each balance sheet date,monetary assets and liabilities that are denominated in foreign currencies are retranslated at therates prevailing on the balance sheet date. Non-monetary assets and liabilities carried at fairvalue that are denominated in foreign currencies are translated at the rates prevailing at the datewhen the fair value was determined. Gains and losses arising on retranslation are included in theincome statement for the period, except for exchange differences arising on non-monetary assetsand liabilities where the changes in fair value are recognised directly in equity.

Non-monetary items that are measured in terms of historical cost in foreign currency are notretranslated.

In order to hedge its exposure to certain foreign exchange risks, the Group enters into forwardcontracts and options (see below for details of the Group’s accounting policies in respect of suchderivative financial instruments).

For the purpose of presenting consolidated financial statements, the assets and liabilities of theGroup’s foreign operations are translated at exchange rates prevailing on the balance sheet date.Income and expense items are translated at the average exchange rates for the period, unlessexchange rates fluctuate significantly. Exchange differences arising, if any, are classified as equityand transferred to the Group’s translation reserve. Such translation differences are recognised asincome or as expenses in the period in which the operation is disposed of.

The financial statements of foreign subsidiaries and associates that report in the currency of ahyperinflationary economy are restated in terms of the measuring unit current at the balance sheetdate before they are translated into US dollars.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated asassets and liabilities of the foreign entity and translated at the closing rate.

Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of qualifyingassets, which are assets that necessarily take a substantial period of time to get ready for theirintended use or sale, are added to the cost of those assets, until such time as the assets aresubstantially ready for their intended use or sale. Investment income earned on the temporaryinvestment in specific borrowings pending their expenditure on qualifying assets is deducted fromthe borrowing costs eligible for capitalisation.

All other borrowing costs are recognised in the income statement in the period in which they areincurred.

Government grants

Government grants towards staff re-training costs are recognised as income over the periodsnecessary to match them with the related costs and are deducted in reporting the relatedexpense.


121

Government grants relating to property, plant and equipment are treated as deferred income andreleased to the income statement over the expected useful lives of the assets concerned.

Operating profit

Profit from operations is stated after charging restructuring costs but before the share of resultsof associates, investment income and finance costs.

Exceptional items

Exceptional items are those items of financial performance that are material and non-recurring innature that the Group believes should be disclosed separately within the financial statements toassist in the understanding of the financial performance of the Group.

Retirement benefit costs

Payments to defined contribution retirement benefit plans are charged as an expense as they falldue. Payments made to state-managed retirement benefit schemes are dealt with as paymentsto defined contribution plans where the Group’s obligations under the schemes are equivalent tothose arising in a defined contribution retirement benefit plan.

Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from netprofit as reported in the income statement because it excludes items of income or expense thatare taxable or deductible in other years and it further excludes items that are never taxable ordeductible. The Group’s liability for current tax is calculated using tax rates that have beenenacted or substantively enacted by the balance sheet date.

Deferred tax is the tax expected to be payable or recoverable on differences between the carryingamounts of assets and liabilities in the financial statements and the corresponding tax bases usedin the computation of taxable profit, and is accounted for using the balance sheet liability method.

Deferred tax liabilities are generally recognised for all taxable temporary differences and deferredtax assets are recognised to the extent that it is probable that taxable profits will be availableagainst which deductible temporary differences can be utilised. Such assets and liabilities are notrecognised if the temporary difference arises from goodwill or from the initial recognition (otherthan in a business combination) of other assets and liabilities in a transaction that affects neitherthe tax profit nor the accounting profit.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments insubsidiaries and associates, and interests in joint ventures, except where the Group is able tocontrol the reversal of the temporary difference and it is probable that the temporary difference willnot reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reducedto the extent that it is no longer probable that sufficient taxable profits will be available to allow allor part of the asset to be recovered.


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Deferred tax is calculated at the tax rates that are expected to apply in the period when the liabilityis settled or the asset realised. Deferred tax is charged or credited in the income statement,except when it relates to items charged or credited directly to equity, in which case the deferredtax is also dealt with in equity.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set offcurrent tax assets against current tax liabilities and when they relate to income taxes levied by thesame taxation authority and the Group intends to settle its current tax assets and liabilities on anet basis.

Deferred tax assets and liabilities are not discounted.

Property, plant and equipment

Items of property, plant and equipment are carried at cost less accumulated depreciation and anyaccumulated impairment losses. Depreciation is charged so as to write off the depreciable valueof the assets over their estimated useful lives, using the straight line method, on the followingbasis:

Capitalised property finance lease 2% per annum

Leasehold land, buildings and improvements Over the lease term

Computer and workshop equipment 14%–33% per annum

Motor vehicles 25% per annum

Office furniture and equipment 10% per annum

Certain costs of purchase, development and installation of major information systems (includingpackaged software) are capitalised and amortised over their expected useful lives (generally threeto five years) on a straight line basis.

Assets held under finance leases are depreciated over their expected useful lives on the samebasis as owned assets or, where shorter, the term of the relevant lease.

The gain or loss arising on the disposal or retirement of an asset is determined as the differencebetween the sales proceeds and the carrying amount of the asset and is recognised in the incomestatement.

The estimated useful lives, residual values and depreciation methods are reviewed at each yearend, with the effect of any changes in estimates accounted for on a prospective basis.

Investment property

Investment property, which is property held to earn rentals and/or for capital appreciation, ismeasured initially at its cost, including transaction costs. Subsequent to initial recognition,investment property is measured at fair value. Gains and losses arising from changes in the fairvalue of investment property are included in the income statement for the period in which theyarise.


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Intangible assets

Acquired intangible assets

Purchased intangible assets, which include customer lists and intellectual property, arecapitalised and amortised over their useful economic lives on a straight line basis.

Computer software

Computer software is stated at cost less accumulated amortisation and, where appropriate,provision for impairment in value or estimated loss on disposal.

Acquired computer software is capitalised on the basis of costs incurred to acquire and bring intouse the specific software. Amortisation is provided to write off the cost of assets on a straight linebasis over their estimated useful lives of between three to five years. The SAP software is writtenoff over seven years. Costs associated with developing or maintaining computer software arerecognised as an expense as incurred, unless they increase the future economic benefits of theasset, in which case they are capitalised.

Internally generated computer software is capitalised at cost if the project is technically andcommercially feasible and the economic benefits that are expected to be generated exceed oneyear. The expenditure capitalised includes the cost of materials, direct labour and an appropriateproportion of overheads. Subsequent expenditure is capitalised only when it increases the futureeconomic benefits embodied in the specific assets to which it relates. Amortisation is provided towrite off the cost of assets on a straight line basis between three and seven years.

Internally-generated intangible assets — research and development

Expenditure on research activities is recognised as an expense in the period in which it isincurred.

An internally-generated intangible asset arising from the Group’s Solutions business isrecognised only if all of the following conditions are met:

• An asset is created that can be identified (such as software and new processes);

• It is probable that the asset created will generate future economic benefits; and

• The development cost of the asset can be measured reliably.

Internally-generated intangible assets are amortised on a straight line basis over their useful lives,generally between three and five years. Where no internally-generated intangible asset can berecognised, development expenditure is recognised as an expense in the period in which it isincurred.

Patents and trademarks

Patents and trademarks are measured initially at purchase cost and are amortised on a straightline basis over their estimated useful lives.

The estimated useful lives, residual values and depreciation methods are reviewed at each yearend, with the effect of any changes in estimates accounted for on a prospective basis.


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Impairment of tangible and intangible assets excluding goodwill

At each balance sheet date, the Group reviews the carrying amounts of its tangible and intangibleassets to determine whether there is any indication that those assets have suffered an impairmentloss. If any such indication exists, the recoverable amount of the asset is estimated in order todetermine the extent of the impairment loss (if any). Where the asset does not generate cashflows that are independent from other assets, the Group estimates the recoverable amount of thecash-generating unit to which the asset belongs. An intangible asset with an indefinite useful lifeis tested for impairment annually and whenever there is an indication that the asset may beimpaired.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessingvalue in use, the estimated future cash flows are discounted to their present value using a pre-taxdiscount rate that reflects current market assessments of the time value of money and the risksspecific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than itscarrying amount, the carrying amount of the asset (cash-generating unit) is reduced to itsrecoverable amount. An impairment loss is recognised as an expense immediately.

Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that theincreased carrying amount does not exceed the carrying amount that would have beendetermined had no impairment loss been recognised for the asset (cash-generating unit) in prioryears. A reversal of an impairment loss is recognised as income immediately.

Inventories

Inventories are stated at the lower of cost and net realisable value. Cost comprises directmaterials and, where applicable, direct labour costs and those overheads that have been incurredin bringing the inventories to their present location and condition. Cost is calculated using theweighted average method.

Net realisable value represents the estimated selling price less all estimated costs of completionand costs to be incurred in marketing, selling and distribution.

Financial instruments

Financial instruments

Financial assets and financial liabilities are recognised in the Group’s balance sheet when theGroup becomes a party to the contractual provisions of the instrument.

Trade receivables

Trade receivables are measured at initial recognition at fair value, and are subsequentlymeasured at amortised cost using the effective interest rate method. Appropriate allowances forestimated irrecoverable amounts are recognised in the income statement when there is evidencethat the asset is impaired. The allowance recognised is measured as the difference between theasset’s carrying amount and the present value of estimated future cash flows discounted at theeffective interest rate computed at initial recognition.


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Investments

Investments are recognised and derecognised on a trade date where a purchase or sale of aninvestment is under a contract whose terms require delivery of the investment within thetimeframe established by the market concerned, and are initially measured at cost, includingtransaction costs.

At subsequent reporting dates, debt securities that the Group has the expressed intention andability to hold to maturity (held-to-maturity debt securities) are measured at amortised cost usingthe effective interest rate method, less any impairment loss recognised to reflect irrecoverableamounts. An impairment loss is recognised in the income statement when there is objectiveevidence that the asset is impaired, and is measured as the difference between the investment’scarrying amount and the present value of estimated future cash flows discounted at the effectiveinterest rate computed at initial recognition.

Impairment losses are reversed in subsequent periods when an increase in the investment’srecoverable amount can be related objectively to an event occurring after the impairment wasrecognised, subject to the restriction that the carrying amount of the investment at the date theimpairment is reversed shall not exceed what the amortised cost would have been had theimpairment not been recognised.

Investments other than held-to-maturity debt securities are classified as either investments heldfor trading or as available for sale, and are measured at subsequent reporting dates at fair value.Where securities are held for trading purposes, gains and losses arising from changes in fair valueare included in the income statement for the period. For available for sale investments, gains andlosses arising from changes in fair value are recognised directly in equity, until the security isdisposed of or is determined to be impaired, at which time the cumulative gain or loss previouslyrecognised in equity is included in the income statement for the period. Impairment lossesrecognised in the income statement for equity investments classified as available for sale are notsubsequently reversed through the income statement. Impairment losses recognised in theincome statement for debt instruments classified as available for sale are subsequently reversedif an increase in the fair value of the instrument can be objectively related to an event occurringafter the recognition of the impairment loss.

Investments in subsidiaries are carried in the parent Company balance sheet at cost lessprovisions for impairments.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and demand deposits, and other short termhighly liquid investments that are readily convertible to a known amount of cash and are subjectto an insignificant risk of changes in value.

Financial liabilities and equities

Financial liabilities and equity instruments are classified according to the substance of thecontractual arrangements entered into. An equity instrument is any contract that evidences aresidual interest in the assets of the Group after deducting all of its liabilities.

Bank borrowings

Interest-bearing bank loans and overdrafts are initially measured at fair value, and aresubsequently measured at amortised cost, using the effective interest rate method. Any difference


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between the proceeds (net of transaction costs) and the settlement or redemption of borrowingsis recognised over the term of the borrowings in accordance with the Group’s accounting policyfor borrowing costs (see above).

Convertible loan notes

Convertible loan notes are regarded as compound instruments, consisting of a liability componentand an equity component. At the date of issue, the fair value of the liability component is estimatedusing the prevailing market interest rate for similar non-convertible debt. The difference betweenthe proceeds of issue of the convertible loan notes and the fair value assigned to the liabilitycomponent, representing the embedded option to convert the liability into equity of the Group, isincluded in equity.

Issue costs are apportioned between the liability and equity components of the convertible loannotes based on their relative carrying amounts at the date of issue. The portion relating to theequity component is charged directly against equity.

The interest expense on the liability component is calculated by applying the prevailing marketinterest rate for similar non-convertible debt to the liability component of the instrument. Thedifference between this amount and the interest paid is added to the carrying amount of theconvertible loan note.

On conversion of the instruments the value of the debt is transferred to equity reserves.

Trade payables

Trade payables are initially measured at fair value, and are subsequently measured at amortisedcost, using the effective interest rate method.

Equity instruments

Equity instruments issued by the Company are recorded at the proceeds received, net of directissue costs.

Derivative financial instruments

The Group uses derivative financial instruments (primarily foreign currency forward contracts) tohedge its risks associated with foreign currency fluctuations relating to certain firm commitmentsand forecasted transactions. Such derivatives are initially recorded at fair value, if any, and areremeasured to fair value at subsequent reporting dates. The Group does not use derivativefinancial instruments for speculative purposes. The use of financial derivatives is governed by theGroup’s policies approved by the Board of Directors, which provide written principles on the useof financial derivatives.

Changes in the fair value of derivative financial instruments that are designated and effective ashedges of future cash flows are recognised directly in equity and the ineffective portion isrecognised immediately in the income statement. If the cash flow hedge of a firm commitment orforecasted transaction results in the recognition of an asset or a liability, then, at the time the assetor liability is recognised, the associated gains or losses on the derivative that had previously beenrecognised in equity are included in the initial measurement of the asset or liability. For hedgesthat do not result in the recognition of an asset or a liability, amounts deferred in equity arerecognised in the income statement in the same period in which the hedged item affects theincome statement.


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Changes in the fair value of designated fair value hedges and derivative financial instruments thatdo not qualify for hedge accounting are recognised in the income statement as they arise.

Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated orexercised, or no longer qualifies for hedge accounting. At that time, any cumulative gain or losson the hedging instrument recognised in equity is retained in equity until the forecastedtransaction occurs. If a hedged transaction is no longer expected to occur, the net cumulative gainor loss recognised in equity is transferred to the income statement for the period.

Derivatives embedded in other financial instruments or non-derivative host contracts are treatedas separate derivatives when their risks and characteristics are not closely related to those of hostcontracts and the host contracts are not carried at fair value with unrealised gains or lossesreported in the income statement.

Provisions

Provisions are recognised when the Group has a present legal or constructive obligation, as aresult of past events, for which it is probable that an outflow of economic benefits will be requiredto settle the obligation, and a reliable estimate can be made for the amount of the obligation.Where the effect of discounting to present value is material, provisions are adjusted to reflect thetime value of money.

Provisions for warranty costs are recognised at the date of sale of the relevant products, at theDirectors’ best estimate of the expenditure required to settle the Group’s liability.

Provisions for restructuring costs are recognised when the Group has a detailed formal plan forthe restructuring that has been communicated to affected parties.

Share-based payment

The Group has applied the requirements of IFRS 2 ‘Share-based Payment’. In accordance withthe transitional provisions, IFRS 2 has been applied to all grants of equity instruments after 7November 2002 that were unvested as of 1 January 2005.

The Group issues equity-settled share-based payments to certain employees. Equity-settledshare-based payments are measured at fair value at the date of grant. The fair value determinedat the grant date of the equity-settled share-based payments is expensed on a straight line basisover the vesting period, based on the Group’s estimate of the shares that will eventually vest.

Fair value is measured by use of a binomial model. The expected life used in the model has beenadjusted, based on management’s best estimate, for the effects of non-transferability, exerciserestrictions and behavioural considerations.”


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1. DIRECTORS

The names, addresses and designations of the Directors as at the Latest Practicable Date areset out below:

Name Address Designation

Patrick Keith Quarmby 108 Mount Street, Bryanston,South Africa

Non-ExecutiveChairman

William Bruce GrahamePadfield

99 Namly Avenue,Shamrock Park,Singapore 267668

Executive Director andChief Executive Officer

Frank Yung-Cheng Yung 61 Grange Road,#09-02 Beverly Hill Apartments,Singapore 249570

Independent Director

Chew Kia Ngee 10A Rochalie Drive,Singapore 248243


Ronald John Cattell 8 Wharf Road, Vaucluse, Sydney,NSW 2030, Australia


Lal Chandra Singh 303/304, Lyra Satellite Towers,Koregaon Park Annexe,Pune 411036, India


Jeremy John Ord 19A Coronation Road,Sandhurst, South Africa


Josua Malherbe 27 Bulties Ave, Parel Valley,Somerset West, 7130, South Africa


Brett William Dawson 20A Ormonde Street,Bryanston, 2021,South Africa

Alternate Director toJeremy John Ord

Stephen Michael Joubert 128 Trafalgar Place,Sandhurst Gauteng, South Africa

Alternate Director toJosua Malherbe

2. PRINCIPAL ACTIVITIES

The Company was incorporated in Singapore on 29 March 1993 and was listed on theMainboard of the SGX-ST in 1995. The Company is an independent IT services and solutionsprovider in Asia-Pacific. As a pioneer in systems and network integration, the Company hasdesigned, implemented and managed network infrastructure for many global corporations andleading service providers, as well as the equivalent of the “Fortune 200 companies” in everycountry throughout Asia-Pacific. Dimension Data presently holds in aggregate approximately55.10 per cent. of the Company. The Company is headquartered in Singapore and has morethan 50 major offices and over 1,450 employees across 13 Asia-Pacific markets.

APPENDIX 3: GENERAL INFORMATION

129

Details of the subsidiaries of the Company, as at the Latest Practicable Date, including theprincipal activities of the subsidiaries, are set out below:

Name of Subsidiary Principal Activities

Country ofIncorporation/Place of Business

Group’sEffective Equity

Interest (%)

Communication Powerand Design Pte Ltd

Investment holding Singapore 100

Datacraft AdvancedNetwork Services SdnBhd

Provision of softwareconsultancy services anddesigning, development,marketing and servicing of datacommunication systems

Malaysia 100

Datacraft AsiaInvestments B.V.

Investment holding Netherlands 100

Datacraft Asia Trust PteLtd

Trustees to employees of theGroup in their acquisition orproposed acquisition of fully-paid shares of Datacraft AsiaLtd pursuant to the DatacraftAsia Share Option Schemes

Singapore 100

Datacraft China/HongKong Limited

Designing, development,marketing and servicing of datacommunication systems

Hong Kong 100

Datacraft Philippines,Inc.


Philippines 100

Datacraft Holdings (NZ)Limited

Investment holding New Zealand 100

Datacraft Holdings(Thailand) Ltd

Investment holding Thailand 49(1)

Datacraft (Hong Kong)Limited

Inactive Hong Kong 100

Datacraft India Limited Designing, development,marketing and servicing of datacommunication systems

India 100

Datacraft InformationTechnology (Beijing)Ltd

Sale of networking equipment,software services and systemintegration

The People’sRepublic of China

100

Datacraft Japan Inc.[Shares held byDatacraft Asia Ltd andDatacraft AsiaInvestments B.V.]

Designing, developmentmarketing and servicing of datacommunication systems

Japan 93

Datacraft Korea Inc. Sale and servicing of datacommunication systems

Korea 100

Datacraft (Malaysia)Sdn Bhd


Malaysia 100


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Interest (%)

Datacraft Networks(China) Inc.[Shares held byDatacraft China/HongKong Limited]

Designing, marketing, sellingand servicing communicationproducts and systems

Republic ofMauritius

100

Datacraft (NZ) Limited[Shares held byDatacraft Holdings(NZ) Limited]


New Zealand 100

Datacraft (Singapore)Pte Ltd


Singapore 100

Datacraft Taiwan Limited Designing, development,marketing and servicing of datacommunication systems

Taiwan 100

Datacraft (Thailand)Limited[Preference sharesheld by DatacraftHoldings (Thailand)Ltd]


Thailand 74

Datacraft Vietnam Ltd[Shares held byCommunicationPower and DesignPte Ltd]

Provision of informationtechnology services, computersystem and software designconsultancy services

The SocialistRepublic of Vietnam

100

DFI ConsultingPhilippines Inc.[Shares held byDatacraft AdvancedNetwork Services SdnBhd]

Inactive Philippines 100

DFI Consulting(Thailand) Co., Ltd[Ordinary shares heldby DatacraftAdvanced NetworkSdn Bhd. Preferenceshares held byDatacraft Holdings(Thailand) Ltd]

Inactive Thailand 74

JQ Network Pte Ltd Sale of data communicationsystems

Singapore 100

Multisoft IT SolutionsPte Ltd[Shares held byDatacraft (Singapore)Pte Ltd]

Sale of computer hardware,software and licences and theprovision of ancillary services

Singapore 100


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Interest (%)

PlaNET Solutions(International) Ltd

Computer systems consultants Malaysia 60

PlaNET Solutions (M)Sdn Bhd[Shares held byPlaNET TechnologySolutions Pte Ltd]

Sale of data communicationsystems

Malaysia 60

PlaNET TechnologySolutions Pte Ltd

Sale of data communicationsystems

Singapore 60

P.T. Datacraft Indonesia[Shares jointly held byDatacraft Asia Ltd andCommunicationPower & Design PteLtd]


Indonesia 100

TP Network Consulting(Shanghai) Co Ltd

Inactive The People’sRepublic of China

100

Training Partners Co.,Ltd[Shares jointly held byDatacraft Asia Ltd andDatacraft Holdings(Thailand) Ltd]

Provision of training,consultancy, systemdevelopment and projectmanagement in computers,computer software andcommunications

Thailand 74

Training Partners PteLtd

Provision of training Singapore 100

Note:

(1) Datacraft Holdings (Thailand) Ltd is treated as a subsidiary as the Company controls the composition of its boardof directors and its financing and operating decisions.

3. SHARE CAPITAL

3.1 Number and Class of Shares. The Company has only one class of Shares, comprising ordinaryshares. As at the Latest Practicable Date, the issued share capital of the Company is as follows:

As at the Latest Practicable Date No. of ordinary shares Amount

Issued and fully paid-up(excluding 23,230,000 treasury shares) 461,981,427 US$134,313,000

3.2 Rights and Privileges of the Shares. The rights and privileges of the Shares as extracted fromthe Memorandum and Articles of Association of the Company are set out in Appendix 4 to thisDocument.


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3.3 Issue of Shares. Since 30 September 2007, 17,198,744 new Shares have been issued for cashby the Company pursuant to the allotment of Shares under the Datacraft Scrip DividendScheme, the details of which are as follows:

Allotment Date No. of Shares Reasons for issuance

19 Mar 2008 17,198,744 Issue of new Shares at US$1.097 per Share pursuant to the DatacraftScrip Dividend Scheme

3.4 Convertible Instruments. Save as disclosed below, as at the Latest Practicable Date, there areno outstanding instruments convertible into, rights to subscribe for, or options in respect of, theShares which carry voting rights affecting the Shares.

As at the Latest Practicable Date, there are outstanding Options under the Datacraft ShareOption Schemes entitling holders thereof to subscribe for a total of 27,726,000 Shares, thedetails of which are as follows:

Date of Grant

No. of outstandingOptions as at

the Latest PracticableDate

ExercisePrice (US$)

Exercise Period

From To

Datacraft Asia Share Option Scheme 1996

28 Jan 1999 500,000 1.770 28 Jan 2000 27 Jan 2009

3 Sep 1999 307,000 3.920 3 Sep 2000 2 Sep 2009

10 Apr 2000 14,000 8.080 10 Apr 2001 9 Apr 2010

28 Aug 2000 160,000 7.880 28 Aug 2001 27 Aug 2010

13 Feb 2001 110,000 5.880 13 Feb 2002 12 Feb 2011

12 Apr 2001 111,000 3.950 12 Apr 2002 11 Apr 2011

29 Jun 2001 772,000 4.100 29 Jun 2002 28 Jun 2011

25 Jan 2002 4,186,000 2.180 25 Jan 2003 24 Jan 2012

28 Nov 2002 2,047,000 0.725 28 Nov 2003 27 Nov 2012

Total 8,207,000


29 Dec 2003 2,225,000 1.147 29 Dec 2004 28 Dec 2013

23 Nov 2004 2,249,000 0.835 23 Nov 2005 22 Nov 2014

20 Feb 2006 3,086,000 1.140 20 Feb 2007 19 Feb 2013

15 Mar 2007 4,612,000 1.080 15 Mar 2008 14 Mar 2014

27 Dec 2007 7,147,000 1.230 27 Dec 2008 26 Dec 2014

1 Apr 2008 200,000 0.885 1 Apr 2009 31 Mar 2015

Total 19,519,000


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3.5 Share Awards. Save as disclosed below, as at the Latest Practicable Date, there are nooutstanding awards of Shares which carry voting rights affecting the Shares.

As at the Latest Practicable Date, there are outstanding awards for 1,098,000 Shares under theDatacraft Share Plan, the details of which are as follows:

Date of GrantNo. of Shares subject to award as at the

Latest Practicable Date Date of Release

28 Mar 2008 1,098,000 28 Mar 2011(1)

Note:

(1) Shares which are the subject of the Awards will be released to a Participant, after the vesting period, if certainpredetermined performance targets as determined by the Committee administering the Share Plan are achieved bythe relevant Participant or otherwise in accordance with the Share Plan.

4. DISCLOSURE OF INTERESTS IN SECURITIES

4.1 Interests in Shares. As at the Latest Practicable Date, save as disclosed in this paragraph 4.1and paragraph 4.2, as well as based on the Register of Directors and Register of SubstantialShareholders maintained by the Company, none of the Directors or the SubstantialShareholders has any interest, direct or indirect, in the Shares or securities which carry votingrights in the Company, or instruments convertible into, rights to subscribe for or options inrespect of such Shares or such securities:

NameDirect Interest as at theLatest Practicable Date

Deemed Interest as at theLatest Practicable Date

No. of Shares %(1) No. of Shares %(1)

Directors

William Bruce Grahame Padfield 110,000 0.024 – –

Frank Yung-Cheng Yung 100,000 0.022 56,259(2) 0.012

Ronald John Cattell 394,072 0.085 1,009,075(3) 0.218

Substantial Shareholders (Other Than Directors)

Dimension Data Holdings plc 254,453,105 55.079 98,514 0.021

Invesco Hong Kong Limited(in its capacity as manager/advisor of various accounts) – – 42,226,768 9.140

Notes:

(1) Based on the 461,981,427 issued Shares (excluding treasury shares) as at the Latest Practicable Date.

(2) Frank Yung-Cheng Yung is deemed to have an interest in the 56,259 Shares held by Winseng Pte Ltd by virtue ofSection 7 of the Companies Act.

(3) Ronald John Cattell is deemed to have an interest in the 9,075 Shares held by his spouse, Lynne Cattell and in the1,000,000 Shares held by Citibank N.A. Singapore on behalf of FIRST Trustee Company (NZ) Limited, by virtue ofSection 7 of the Companies Act.


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4.2 Interests in Options. Save as disclosed below, as at the Latest Practicable Date, none of theDirectors or the Substantial Shareholders owns, controls or has agreed to acquire any Options.

Director

No. of outstandingOptions as at theLatest Practicable

DateDate ofGrant

ExercisePrice (US$)

Exercise Period

From To



660,000 28 Nov 2002 0.725 28 Nov 2003 27 Nov 2012

Ronald John Cattell 500,000 28 Jan 1999 1.770 28 Jan 2000 27 Jan 2009

750,000 28 Nov 2002 0.725 28 Nov 2003 27 Nov 2012



520,000 29 Dec 2003 1.147 29 Dec 2004 28 Dec 2013

600,000 23 Nov 2004 0.835 23 Nov 2005 22 Nov 2014

250,000 20 Feb 2006 1.140 20 Feb 2007 19 Feb 2013

500,000 15 Mar 2007 1.080 15 Mar 2008 14 Mar 2014

510,000 27 Dec 2007 1.230 27 Dec 2008 26 Dec 2014

Frank Yung-Cheng Yung 50,000 29 Dec 2003 1.147 29 Dec 2004 28 Dec 2008

Ronald John Cattell 50,000 29 Dec 2003 1.147 29 Dec 2004 28 Dec 2013

Lal Chandra Singh 50,000 29 Dec 2003 1.147 29 Dec 2004 28 Dec 2008

4.3 Interests in Share Awards. Save as disclosed below, as at the Latest Practicable Date, noneof the Directors or the Substantial Shareholders has been granted any awards of Shares underthe Datacraft Share Plan.

Director Date of Grant

No. of Shares subject toaward as at the Latest

Practicable Date Date of Release

William Bruce Grahame Padfield 28 Mar 2008 708,000 28 Mar 2011(1)

Note:

(1) Shares which are the subject of the Awards will be released to a participant, after the vesting period, if certainpre-determined performance targets as determined by the Committee administering the Datacraft Share Plan areachieved by the relevant Participant or otherwise in accordance with the Datacraft Share Plan.

4.4 Holdings of Dimension Data Shares by the Company. As at the Latest Practicable Date, noneof the Company or its subsidiaries owns, controls or has agreed to acquire any Dimension DataShares.


135

4.5 Interests of Directors in Dimension Data Shares. As at the Latest Practicable Date, save asdisclosed in this paragraph 4.5 and elsewhere this Document, none of the Directors has anydirect or indirect interests in Dimension Data Shares, or instruments convertible into, or rights tosubscribe for or options in respect of such shares.

Name

Direct Interest as at theLatest Practicable Date

Deemed Interest as at theLatest Practicable Date

No. ofDimension

Data Shares %(1)

No. ofDimension

Data Shares %(1)

Patrick Keith Quarmby 342,165 0.020 256,460(2) 0.015

Ronald John Cattell 29,067 0.002 26,000(3) 0.002

Jeremy John Ord 2,032,095 0.120 8,669,763(4) 0.512

Brett William Dawson 457,532 0.027 – –

Stephen Michael Joubert 455,955 0.027 – –

Notes:

(1) Based on the 1,694,459,681 issued Dimension Data Shares (excluding treasury shares) as at the LatestPracticable Date.

(2) Patrick Keith Quarmby is deemed to have an interest in the 256,460 Dimension Data Shares held by ChesterInterest (Proprietary) Limited.

(3) Ronald John Cattell is deemed to have an interest in the 26,000 Dimension Data Shares held on trust by FIRSTTrustee Company (NZ) Limited by virtue of Section 7 of the Companies Act.

(4) Jeremy John Ord is deemed to have an interest in the 8,669,763 Dimension Data Shares held by Dimension DataInvestments (Proprietary) Limited and Eloff Street Nominees (Proprietary) Limited.

4.6 Interests of Directors in Dimension Data Options. As at the Latest Practicable Date, save asdisclosed in this paragraph 4.6 and elsewhere this Document, none of the Directors has anydirect or indirect interests in the options to acquire Dimension Data Shares.

Director

No. of DimensionData Options

outstanding as atthe Latest

Practicable DateDate ofGrant

ExercisePrice

Exercise Period

From To

Dimension Data Share Option Scheme 1995 (ZAR)

Patrick Keith Quarmby 604,545 1 Oct 1998 22.00 1 Oct 1998 1 Oct 2008

725,000 17 May 1999 24.00 17 May 1999 17 May 2009

766,255 1 Oct 1999 24.30 1 Oct 1999 1 Oct 2009

Jeremy John Ord 1,625,000 1 Oct 1998 22.00 1 Oct 1998 1 Oct 2008

1,360,000 17 May 1999 24.00 17 May 1999 17 May 2009

2,222,222 1 Oct 1999 24.30 1 Oct 1999 1 Oct 2009

Brett William Dawson 45,350 3 May 2000 43.50 3 May 2000 3 May 2010

70,000 20 Jul 2001 15.25 20 Jul 2001 20 Jul 2011

83,509 1 Oct 2001 9.35 1 Oct 2001 1 Oct 2011


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Director

No. of DimensionData Options

outstanding as atthe Latest

Practicable DateDate ofGrant

ExercisePrice

Exercise Period

From To

Stephen Michael Joubert 811,363 1 Oct 1998 22.00 1 Oct 1998 1 Oct 2008

625,000 17 May 1999 24.00 17 May 1999 17 May 2009

662,551 1 Oct 1999 24.30 1 Oct 1999 1 Oct 2009

Dimension Data Share Option Scheme 2000 (£)

Patrick Keith Quarmby 200,000 21 Nov 2002 0.25 21 Nov 2002 21 Nov 2012

500,000 21 Nov 2002 0.25 21 Nov 2002 21 Nov 2012

300,000 11 Dec 2003 0.37 11 Dec 2003 11 Dec 2013


100,000 18 Nov 2003 0.36 18 Nov 2003 18 Nov 2013

Jeremy John Ord 200,000 21 Nov 2002 0.25 21 Nov 2002 21 Nov 2012

1,500,000 21 Nov 2002 0.25 21 Nov 2002 21 Nov 2012

750,000 11 Dec 2003 0.37 11 Dec 2003 11 Dec 2013

Brett William Dawson 300,000 28 Sep 2001 0.70 28 Sep 2001 28 Sep 2011

100,000 3 Oct 2001 0.70 3 Oct 2001 3 Oct 2011

200,000 21 Nov 2002 0.25 21 Nov 2002 21 Nov 2012

500,000 1 Apr 2003 0.16 1 Apr 2003 1 Apr 2013

1,000,000 20 Aug 2003 0.26 20 Aug 2003 20 Aug 2013

600,000 18 Nov 2003 0.36 18 Nov 2003 18 Nov 2013

300,000 18 Nov 2003 0.36 18 Nov 2003 18 Nov 2013

1,200,000 3 Aug 2004 0.28 3 Aug 2004 3 Aug 2014

Stephen Michael Joubert 200,000 21 Nov 2002 0.25 21 Nov 2002 21 Nov 2012

500,000 21 Nov 2002 0.25 21 Nov 2002 21 Nov 2012

300,000 11 Dec 2003 0.37 11 Dec 2003 11 Dec 2013

4.7 Interests of Directors in the Dimension Data Long-Term Incentive Plan. Save as disclosedbelow, as at the Latest Practicable Date, none of the Directors has been granted any awards ofDimension Data Shares under the Dimension Data Long-Term Incentive Plan.

Director

No. of Dimension Data Sharessubject to award as at the Latest

Practicable Date Date of Grant Date of Vesting

Patrick Keith Quarmby 115,000 22 Nov 2005 12 Nov 2008

460,000 22 Nov 2005 11 Dec 2008

30,000 8 Mar 2006 12 Nov 2008

109,250 1 Dec 2006 11 Nov 2009

437,000 1 Dec 2006 10 Dec 2009

415,000 10 Dec 2007 9 Dec 2010


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Director

No. of Dimension Data Sharessubject to award as at the Latest

Practicable Date Date of Grant Date of Vesting

Jeremy John Ord 230,000 22 Nov 2005 12 Nov 2008

920,000 22 Nov 2005 11 Dec 2008

150,000 8 Mar 2006 12 Nov 2008

218,500 1 Dec 2006 11 Nov 2009

874,000 1 Dec 2006 10 Dec 2009

825,000 10 Dec 2007 9 Dec 2010

Brett William Dawson 230,000 22 Nov 2005 12 Nov 2008

920,000 22 Nov 2005 11 Dec 2008

150,000 8 Mar 2006 12 Nov 2008

218,500 1 Dec 2006 11 Nov 2009

874,000 1 Dec 2006 10 Dec 2009

621,518 10 Dec 2007 10 Nov 2010

825,000 10 Dec 2007 9 Dec 2010

Stephen Michael Joubert 153,000 22 Nov 2005 12 Nov 2008

615,000 22 Nov 2005 11 Dec 2008

75,000 8 Mar 2006 12 Nov 2008

145,350 1 Dec 2006 11 Nov 2009

584,250 1 Dec 2006 10 Dec 2009

550,000 10 Dec 2007 9 Dec 2010

4.8 Interests of Directors in the Dimension Data Share Appreciation Rights Scheme. Save asdisclosed below, as at the Latest Practicable Date, none of the Directors has been granted anyShare Appreciation Rights under the Dimension Data Share Appreciation Scheme.

Director

No. of ShareAppreciation

Rights grantedas at the LatestPracticable Date

Date ofGrant

ExercisePrice

(£)

Exercise Period

From To

Patrick Keith Quarmby 300,000 15 Feb 2005 0.39 14 Nov 2007 14 Nov 2010


50,000 5 Jan 2005 0.36 14 Nov 2007 14 Nov 2010

Jeremy John Ord 600,000 15 Feb 2005 0.39 14 Nov 2007 14 Nov 2010

Brett William Dawson 600,000 15 Feb 2005 0.39 14 Nov 2007 14 Nov 2010

Stephen Michael Joubert 400,000 15 Feb 2005 0.39 14 Nov 2007 14 Nov 2010


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5. DEALINGS IN SECURITIES

5.1 Dealings in Dimension Data Shares by the Company. Neither Datacraft nor its subsidiarieshave dealt for value in Dimension Data Shares during the period commencing six (6) monthsprior to the Announcement Date and ending on the Latest Practicable Date.

5.2 Dealings in Dimension Data Shares by the Directors. Save as disclosed below, none of theDirectors has dealt for value in Dimension Data Shares during the period commencing six (6)months prior to the Announcement Date and ending on the Latest Practicable Date.

DirectorNumber of Dimension Data

Shares Sold Date of DealingConsiderationReceived (£)

Patrick Keith Quarmby 96,000 17 Dec 2007 0.61

Jeremy John Ord 180,000 17 Dec 2007 0.61

Brett William Dawson 144,000 17 Dec 2007 0.61

Stephen Michael Joubert 107,200 17 Dec 2007 0.61

5.3 Dealings in the Shares by the Directors. Save as disclosed below, none of the Directors hasdealt for value in any Shares during the period commencing six (6) months prior to theAnnouncement Date and ending on the Latest Practicable Date.

Director Number of Shares Sold Date of DealingConsideration

Received (US$)

Ronald John Cattell 2,000 16 Jun 2008 1.03

Ronald John Cattell 8,000 17 Jun 2008 1.01(1)

Note:

(1) US$1.01 is the average price received for each of the 8,000 Shares.

6. INTERESTS OF INDEPENDENT FINANCIAL ADVISER

6.1 Interests of PwCCF in Shares and Voting Rights. PwCCF (i) does not own, control and hasnot agreed to acquire any Shares or securities which carry voting rights or are convertible intoShares or securities which carry voting rights or any rights to subscribe for or options in theShares or in respect of securities which carry voting rights in the Company as at the LatestPracticable Date, (ii) has not received any irrevocable undertaking from any party to vote infavour of the Scheme at the Court Meeting as at the Latest Practicable Date.

6.2 Dealings in Shares by PwCCF. PwCCF has not dealt for value in the Shares during the periodcommencing six (6) months prior to the Announcement Date, and ending on the LatestPracticable Date.

6.3 No Discretionary Funds. PwCCF does not manage the investments of any fund.


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7. FINANCIAL INFORMATION

7.1 Financial Information of the Group

A summary of the audited financial information of the Group for the FY 2005, FY 2006 and FY2007 (based on the audited financial statements), together with the unaudited financialinformation of the Group for Q3 2007 and Q3 2008 is set out below.

The following summary is extracted from, and should be read in conjunction with, the auditedfinancial statements (or unaudited financial statements, as the case may be) for the relevantfinancial periods and related notes thereto.

(a) Profit and Loss Accounts

<- - - - - - - - - - -Audited- - - - - - - - - - -> <- - - - -Unaudited- - - - ->FY 2005US$’000

FY 2006US$’000

FY 2007US$’000

Q3 2007US$’000

Q3 2008US$’000

Revenue 455,977 482,157 580,829 419,849 541,038

Cost of sales (378,183) (391,722) (470,009) (340,561) (441,067)

Gross profit 77,794 90,435 110,820 79,288 99,971

Other operating income(1) 3,944 9,544(2) 4,226 3,154 4,469

Other expenses:

Distribution and sales (41,039) (40,832) (46,757) (33,617) (43,134)

Administrative(3) (22,611) (23,772) (27,063) (19,652) (22,714)

Finance costs (102) (104) (50) (50) (1)

Profit before income tax 17,986 35,271 41,176 29,123 38,591

Income Tax (7,838) (9,012) (10,872) (7,957) (10,649)

Profit for the year 10,148 26,259 30,304 21,166 27,942

Attributable to:

Equity holders of theCompany 10,216 26,314 30,316 21,172 27,940

Minority interests (68) (55) (12) (6) 2

10,148 26,259 30,304 21,166 27,942

Earnings per share(US cents)

Basic(4) 2.19 5.68 6.76 4.71 6.19

Fully diluted(5) 2.17 5.66 6.71 4.68 6.16

Dividends per share(US cents) – 4.71 6.30 – –

Notes:

(1) This includes interest income, foreign exchange gain/loss, investment income and others.

(2) In FY 2006, the Company received US$5,150,000 from its insurers as payment for loss from thenon-recoverability of certain accounts receivables in China which were provided for in full in the previousfinancial years.

(3) This includes the share-based payments expenses.

(4) Based on the weighted average number of ordinary shares in issue during the financial year/period.

(5) Based on the weighted average number of ordinary shares for diluted earnings per share during the financialyear/period.


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(b) Balance Sheets

Audited UnauditedFY 2007US$’000

Q3 2008US$’000

ASSETSCurrent assetsCash and cash equivalents 150,491 167,520Trade receivables 134,494 152,751Other receivables and prepayments 35,818 34,565Inventories 10,163 9,162

Total current assets 330,966 363,998

Non-current assetsPlant and equipment 14,337 13,533Goodwill 648 4,419Available-for-sale investments 1,216 1,253Deferred tax assets 1,533 1,792

Total non-current assets 17,734 20,997

Total assets 348,700 384,995

LIABILITIES AND EQUITYCurrent liabilitiesTrade and other payables 133,929 86,444Income tax payables 9,128 11,083Provisions 1,521 67,368

Total current liabilities 144,578 164,895

Non-current liabilitiesDeferred tax liabilities 634 362

Total non-current liabilities 634 362

Capital and reservesIssued capital 139,999 158,866Treasury shares (23,697) (24,649)Share options settlement reserve (37) (22)Share options reserve 4,596 5,351Statutory reserve 500 536Exchange difference reserve 6,696 4,348Goodwill on consolidation (130,415) (130,415)Retained earnings 204,894 204,672

Equity attributable to equity holders of the Company 202,536 218,687Minority interests 952 1,051

Total equity 203,488 219,738

Total liabilities and equity 348,700 384,995

Net assets 203,488 219,738

Net asset value per share (US cents) 45.30 46.39


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7.2 Material Changes in Financial Position

Save as disclosed in this Document, there are no publicly known material changes in thefinancial position of the Group as at the Latest Practicable Date since the date of the lastpublished audited accounts of the Group.

7.3 Accounting Policies

The significant accounting policies together with any points from the notes of the accounts of theGroup which are of major relevance for the interpretation of the accounts of the Group are setout in the audited consolidated financial statements of the Group for FY2007 in Appendix 5 tothis Document.

There is no change in the accounting policies of the Group which will cause the figures disclosedin Appendix 5 to this Document not to be comparable to a material extent.

8. MATERIAL CONTRACTS

Neither the Company nor any of its subsidiaries has entered into any material contracts (notbeing contracts entered into in the ordinary course of business) with any interested personduring the three (3) years preceding the Latest Practicable Date.

9. MATERIAL LITIGATION

As at the Latest Practicable Date:

(a) neither the Company nor any of its subsidiaries is engaged in any material litigation orarbitration proceedings, as plaintiff or defendant, which might materially and adverselyaffect the financial position of the Company and its subsidiaries taken as a whole; and

(b) the Directors are not aware of any litigation, claim or proceeding pending or threatenedagainst the Company or any of its subsidiaries or of any fact likely to give rise to anyproceeding which might materially and adversely affect the financial position of theCompany and its subsidiaries taken as a whole.

10. GENERAL DISCLOSURE

10.1 Financial Statements for FY 2007. The audited consolidated financial statements of the Groupfor FY 2007 are set out in Appendix 5 to this Document.

10.2 Directors’ Service Contracts. There (i) are no service contracts between any Director orproposed director with the Company or any of its subsidiaries with more than twelve (12) monthsto run, which the employing company cannot, within the next twelve (12) months, terminatewithout payment of compensation and (ii) were no service contracts entered into or amendedbetween any of the Directors or proposed director and the Company or any of its subsidiariesduring the period between the start of the six (6) months immediately preceding theAnnouncement Date and the Latest Practicable Date.

10.3 No Payment or Benefit to Directors. There are no payments or other benefits which will bemade or given to any Director or to any director of any other corporation which is, by virtue ofSection 6 of the Companies Act, deemed to be related to the Company as compensation for lossof office or otherwise in connection with the Scheme.


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10.4 No Agreement Conditional upon Outcome of the Scheme. Save as disclosed in thisDocument, there are, as at the Latest Practicable Date, no agreements or arrangements madebetween any Director and any other person in connection with or which are conditional upon theoutcome of the Scheme.

10.5 No Material Interest in Material Contracts Entered into by Dimension Data. None of theDirectors has a personal interest, whether direct or indirect, in any material contract entered intoby Dimension Data.

10.6 All Independent Directors to vote in favour of the Scheme. All the Independent Directorswho have beneficial shareholdings in the Company will vote in favour of the Scheme. As theExcluded Directors are deemed to be acting in concert with Dimension Data, they will abstainfrom voting any of their beneficial shareholdings in the Scheme.

All of the Directors who hold Options pursuant to the Datacraft Share Option Schemes will alsobe accepting the Options Proposal in relation to their Options held as at the Latest PracticableDate.

All of the Directors who hold Share Awards pursuant to the Datacraft Share Plan will also beaccepting the proposal in relation to their Share Awards held as at the Latest Practicable Date.

11. MARKET QUOTATIONS

11.1 Transacted Prices. The high, low (on the daily closing prices for the monthly market data) andlast closing prices and transacted volume of the Shares on SGX-ST on a monthly basis fromJanuary 2008 to August 2008 and on a daily basis from 1 September 2008 to the LatestPracticable Date, are set out below:

High(US$)

Low(US$)

Closing(US$)

Volume (’000)(No. of Shares)

Monthly Trades

January 2008 1.240 1.070 1.070 11,259

February 2008 1.140 1.070 1.120 5,537

March 2008 1.130 0.875 0.890 14,280

April 2008 0.980 0.885 0.915 15,907

May 2008 1.060 0.915 1.040 11,850

June 2008 1.080 1.010 1.020 6,704

July 2008 1.290 0.985 1.280 9,683

August 2008 1.290 1.260 1.270 20,927

Daily Trades

1 September 2008 1.280 1.270 1.270 144

2 September 2008 1.280 1.260 1.280 1,098

3 September 2008 1.280 1.270 1.270 495

4 September 2008 1.280 1.270 1.280 169

5 September 2008 1.280 1.270 1.270 659

8 September 2008 1.290 1.280 1.280 968

9 September 2008 1.290 1.270 1.270 5,706

10 September 2008 1.280 1.270 1.280 256

11 September 2008 1.280 1.280 1.280 487


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High(US$)

Low(US$)

Closing(US$)

Volume (’000)(No. of Shares)

12 September 2008 1.290 1.280 1.280 236

15 September 2008 1.280 1.270 1.280 759

Source: Bloomberg

11.2 Closing Prices. The closing prices of the Shares on SGX-ST on (i) the Market Day precedingthe Announcement Date was US$0.990 per Share and (ii) the Latest Practicable Date wasUS$1.280.

11.3 Highest and Lowest Prices. During the period commencing six (6) months prior to theAnnouncement Date and ending on the Latest Practicable Date, the highest closing price of theShares on SGX-ST was transacted on 25 July 2008, 6 August 2008, 11 August 2008 and 12August 2008 at US$1.290 and the lowest closing price of the Shares on SGX-ST was transactedon 28 March 2008 at US$0.875.

12. CONSENTS

12.1 Deloitte & Touche LLP has given and has not withdrawn its written consent to the issue of thisDocument with the inclusion herein of the Audited Consolidated Financial Statements ofDatacraft and its subsidiaries for the FY 2005, FY 2006 and FY 2007 in the form and context inwhich they appear in this Document and all references to its name in the form and context inwhich it appears in this Document.

12.2 PricewaterhouseCoopers Corporate Finance Pte. Ltd. (as independent financial adviser to theIndependent Directors in connection with the Scheme) has given and has not withdrawn itswritten consent to the issue of this Document with the inclusion of its name and its letter dated22 September 2008, setting out, inter alia, its advice to the Independent Directors in respect ofthe Scheme and all references to its name in the form and context in which it appears in thisDocument.

12.3 Stamford Law Corporation and the Share Registrar have each given and have not withdrawntheir respective written consents to the issue of this Document with the inclusion herein of theirnames and the references to their names, in the form and context in which they respectivelyappear in this Document.

13. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection at the registered office of theCompany at 6 Temasek Boulevard, #26-01/05 Suntec Tower Four, Singapore 038986 duringbusiness hours on any weekday (public holidays excepted) from the date of this Document upto and including the date of the Court Meeting and the EGM:

(a) The Memorandum and Articles of Association of Datacraft;

(b) The Audited Financial Statements of Datacraft and its subsidiaries for FY 2005, FY 2006and FY 2007;

(c) The Implementation Agreement; and

(d) The letters of consent referred to in paragraph 12 above.


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The selected texts of the Articles relating to the rights of the Shareholders in respect of capital,dividends and voting are set out below.

The Rights of Shareholders in respect of Capital

“Article 8

Subject to the Act, no shares may be issued by the Directors without the prior sanction of an OrdinaryResolution of the Company in General Meeting but subject thereto and to Article 52, and to any specialrights attached to any shares for the time being issued, the Directors may issue, allot or grant optionsover or otherwise deal with or dispose of the same to such persons on such terms and conditions andat such time and subject or not to the payment of any part of the amount thereof in cash as the Directorsmay think fit, and any shares may be issued in such denominations or with such preferential, deferred,qualified or special rights, privileges or conditions as the Directors may think fit, and preference sharesmay be issued which are or at the option of the Company are liable to be redeemed, the terms andmanner of redemption being determined by the Directors, provided always that:–

(i) the total nominal value of issued preference shares shall not exceed the total nominal value of theissued ordinary shares at any time;

(ii) the rights attaching to shares of a class other than ordinary shares shall be expressed in theresolution creating the same;

(iii) where the capital of the Company consists of shares of different monetary denominations, thevoting rights shall be prescribed in such manner that a unit of capital in each class when reducedto a common denominator, shall carry the same voting power when such right is exercisable;

(iv) no shares shall be issued at a discount, except in accordance with the Act; and

(v) any issue of shares for cash to Members holding shares of any class shall be offered to suchMembers in proportion as nearly as may be to the number of shares of such class then held bythem and the second sentence of Article 52(1) with such adaptations as are necessary shall apply.

Article 50

The Company in General Meeting may from time to time by Ordinary Resolution, whether all the sharesfor the time being authorised shall have been issued or all the shares for the time being issued shallhave been fully called up or not, increase its capital by the creation of new shares of such amount asmay be deemed expedient.

Article 51

Subject to any special rights for the time being attached to any existing class of shares, the new sharesshall be issued upon such terms and conditions and with such rights and privileges annexed thereto asthe General Meeting resolving upon the creation thereof shall direct and if no direction be given as theDirectors shall determine; subject to the provisions of these Articles and in particular (but withoutprejudice to the generality of the foregoing) such shares may be issued with a preferential or qualifiedright to dividends and in the distribution of assets of the Company or otherwise.

APPENDIX 4: RELEVANT EXCERPTS FROMTHE COMPANY’S ARTICLES OF ASSOCIATION

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Article 52

(1) Subject to any direction to the contrary that may be given by the Company in General Meeting,all new shares shall before issue be offered to the Members in proportion, as nearly as thecircumstances admit, to the amount of the existing shares to which they are entitled or hold. Theoffer shall be made by notice specifying the number of shares offered, and limiting a time withinwhich the offer, if not accepted, will be deemed to be declined, and, after the expiration of thattime, or on the receipt of an intimation from the person to whom the offer is made that he declinesto accept the shares offered, the Directors may dispose of those shares in such manner as theythink most beneficial to the Company. The Directors may likewise so dispose of any new shareswhich (by reason of the ratio which the new shares bear to shares held by persons entitled to anoffer of new shares) cannot, in the opinion of the Directors, be conveniently offered under thisArticle.

(2) Notwithstanding Article 52(1) above but subject to the Act and the byelaws and listing rules of theExchange, the Company may by Ordinary Resolution in General Meeting give to the Directors ageneral authority, either unconditionally or subject to such conditions as may be specified in theOrdinary Resolution to:–

(i) issue shares in the capital of the Company (whether by way of rights, bonus or otherwise);and/or

(ii) make or grant Instruments; and/or

(iii) (notwithstanding the authority conferred by the Ordinary Resolution may have ceased to bein force) issued shares in pursuance of any Instrument made or granted by the Directorswhile the Ordinary Resolution was in force;

Provided that the aggregate number of shares to be issued pursuant to the Ordinary Resolution(including shares to be issued in pursuance of Instrument made or granted pursuant to theOrdinary Resolution but excluding shares which may be issued pursuant to any adjustmentseffected under any relevant Instrument) does not exceed any applicable limits prescribed by theExchange.

(3) Notwithstanding Article 52(1) above but subject to the Act, the Directors shall not be required tooffer any new shares to members to whom by reason of foreign securities laws such offers maynot be made without registration of the shares or a prospectus or other document, but to sell theentitlements to the new shares on behalf of such Members in such manner as they think mostbeneficial to the Company.

Article 53

Except so far as otherwise provided by the conditions of issue or by these Articles, any capital raisedby the creation of new shares shall be considered part of the original ordinary capital of the Companyand shall be subject to the provisions of these Articles with reference to allotments, payment of calls,lien, transfer, transmission, forfeiture and otherwise.

Article 54

The Company may by Ordinary Resolution:–

(i) consolidate and divide all or any of its share capital into shares of larger amount than its existingshares;


146

(ii) cancel any shares which, at the date of the passing of the Resolution, have not been taken oragreed to be taken by any person or which have been forfeited and diminish the amount of itsshare capital by the amount of the shares so cancelled;

(iii) subdivide its shares or any of them into shares of a smaller amount than is fixed by theMemorandum of Association (subject, nevertheless, to the provisions of the Act), provided alwaysthat in such subdivision the proportion between the amount paid and the amount (if any) unpaidon each reduced share shall be the same as it was in the case of the share from which thereduced share is derived; and

(iv) subject to the provisions of these Articles and the Act, convert any class of shares into any otherclass of shares.

Article 55

(1) The Company may by Special Resolution reduce its share capital, any capital redemption reservefund or share premium account in any manner authorised and subject to any conditionsprescribed, or consent required, by law. Without prejudice to the generality of the foregoing, uponcancellation of any share purchased or otherwise acquired by the Company pursuant to theseArticles, the nominal amount of the issued share capital of the Company shall be diminished bythe nominal amount of the share so cancelled.

(2) Subject to and in accordance with the Act, the listing rules of the Exchange, and other written law,the Company may purchase or otherwise acquire shares in the issued share capital of theCompany on such terms and in such manner as the Company may from time to time think fit. Ifrequired by the Act, any share which is so purchased or acquired by the Company shall bedeemed cancelled immediately on purchase or acquisition by the Company. On the cancellationof any share as aforesaid, the rights and privileges attached to that share shall expire. In any otherinstance, the Company may deal with any such share which is so purchased or acquired by it insuch manner as may be permitted by, and in accordance with, the Act, the listing rules of theExchange, and other written law.”

The Rights of Shareholders in respect of Voting

“Article 76

Subject and without prejudice to any special privileges or restrictions as to voting for the time beingattached to any special class of shares for the time being forming part of the capital of the Companyeach Member entitled to vote may vote in person or by proxy or attorney, and (in the case of acorporation) by a representative. On a show of hands every Member who is present in person or byproxy or attorney, or in the case of a corporation by a representative, shall have one vote provided thatif a Member is represented by two proxies, only one of the two proxies as determined by their appointorshall vote on a show of hands and in the absence of such determination, only one of the two proxiesas determined by the Chairman (or by a person authorised by him) shall vote on a show of hands andon a poll, every Member who is present in person or by proxy, attorney or representative shall have onevote for each share which he holds or represents Provided Always That notwithstanding anythingcontained in these Articles, a Depositor shall not be entitled to attend any General Meeting and to speakand vote thereat unless his name is certified by the Depository to the Company as appearing on theDepository Register not earlier than 48 hours before that General Meeting (the “cut-off time”) as aDepositor on whose behalf the Depository holds shares in the Company. For the purpose ofdetermining the number of votes which a Depositor or his proxy may cast on a poll, the Depositor orhis proxy shall be deemed to hold or represent that number of shares entered in the Depositor’s


147

Securities Account at the cut-off time as certified by the Depository to the Company, or where aDepositor has apportioned the balance standing to his Securities Account as at the cut-off time betweentwo proxies, to apportion the said number of shares between the two proxies in the same proportion asspecified by the Depositor in appointing the proxies; and accordingly no instrument appointing a proxyof a Depositor shall be rendered invalid merely by reason of any discrepancy between the number ofshares standing to the credit of that Depositor’s Securities Account as at the cut-off time, and the truebalance standing to the Securities Account of a Depositor as at the time of the relevant generalmeeting, if the instrument is dealt with in such manner as aforesaid.

Article 77

Where there are joint holders of any share any one of such persons may vote and be reckoned in aquorum at any Meeting either personally or by proxy or by attorney or in the case of a corporation bya representative as if he were solely entitled thereto but if more than one of such joint holders is sopresent at any meeting then the person present whose name stands first in the Register of Membersor the Depository Register (as the case may be) in respect of such share shall alone be entitled to votein respect thereof. Several executors or administrators of a deceased Member in whose name anyshare stands shall for the purpose of this Article be deemed joint holders thereof.

Article 78

If a Member be a lunatic, idiot or non-compos mentis, he may vote whether on a show of hands or ona poll by his committee, curator bonis or such other person as properly has the management of hisestate and any such committee, curator bonis or other person may vote by proxy or attorney, providedthat such evidence as the Directors may require of the authority of the person claiming to vote shallhave been deposited at the Office not less than forty-eight hours before the time appointed for holdingthe Meeting.

Article 79

Subject to the provisions of these Articles, every Member either personally or by attorney or in the caseof a corporation by a representative and every proxy shall be entitled to be present and to vote at anyGeneral Meeting and to be reckoned in the quorum thereat in respect of shares fully paid and in respectof partly paid shares where calls are not due and unpaid.

Article 80

No objection shall be raised to the qualification of any voter except at the Meeting or adjourned Meetingat which the vote objected to is given or tendered and every vote not disallowed at such Meeting shallbe valid for all purposes. Any such objection made in due time shall be referred to the Chairman of theMeeting whose decision shall be final and conclusive.

Article 81

On a poll votes may be given either personally or by proxy or by attorney or in the case of a corporationby its representative and a person entitled to more than one vote need not use all his votes or cast allthe votes he uses in the same way.


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Article 82

(1) A Member may appoint not more than two proxies to attend and vote at the same GeneralMeeting.

(2) If the Member is a Depositor, the Company shall be entitled:–

(i) to reject any instrument of proxy lodged if the Depositor is not shown to have any sharesentered in its Securities Account as at the cut-off time as certified by the Depository to theCompany; and

(ii) to accept as validly cast by the proxy or proxies appointed by the Depositor on a poll thatnumber of votes which corresponds to or is less than the aggregate number of sharesentered in its Securities Account of that Depositor as at the cut-off time as certified by theDepository to the Company, whether that number is greater or smaller than the numberspecified in any instrument of proxy executed by or on behalf of that Depositor.

(3) Where a Member appoints more than one proxy, he shall specify the proportion of hisshareholding to be represented by each proxy. If no such proportion or number is specified thefirst named proxy may be treated as representing 100% of the shareholding and any secondnamed proxy as an alternate to the first named.

(4) Voting right(s) attached to any shares in respect of which a Member has not appointed a proxymay only be exercised at the relevant general meeting by the member personally or by hisattorney, or in the case of a corporation by its representative.

(5) Where a Member appoints a proxy in respect of more shares than the shares standing to his namein the Register of Members, or in the case of a Depositor, standing to the credit of that Depositor’sSecurities Account, such proxy may not exercise any of the votes or rights of the shares notregistered to the name of that Member in the Register of Members or standing to the credit of thatDepositor’s Securities Account as at the cut-off time, as the case may be.

Article 83

A proxy or attorney need not be a Member, and shall be entitled to vote on a show of hands on anyquestion at any General Meeting.

Article 84

Any instrument appointing a proxy shall be in writing in the common form approved by the Directorsunder the hand of the appointor or his attorney duly authorised in writing or, if the appointor is acorporation, under seal or under the hand of its attorney duly authorised and the Company shall acceptas valid in all respects the form of proxy approved by the Directors for use at the date relevant to theGeneral Meeting in question.

Article 85

The instrument appointing a proxy, together with the power of attorney or other authority, if any, underwhich the instrument of proxy is signed or a duly certified copy of that power of attorney or otherauthority (failing previous registration with the Company) shall be attached to the instrument of proxyand must be left at the Office or such other place (if any) as is specified for the purpose in the noticeconvening the Meeting not less than forty-eight hours before the time appointed for the holding of theMeeting or adjourned Meeting (or in the case of a poll before the time appointed for the taking of thepoll) at which it is to be used failing which the instrument may be treated as invalid. An instrumentappointing a proxy shall, unless the contrary is stated thereon, be valid as well for any adjournment of


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the Meeting as for the Meeting to which it relates Provided that an instrument of proxy relating to morethan one meeting (including any adjournment thereof) having once been so delivered for the purposesof any meeting shall not be required again to be delivered for the purposes of any subsequent meetingto which it relates. An instrument of proxy shall be deemed to include the power to demand or concurin demanding a poll on behalf of the appointer. Unless otherwise instructed, a proxy shall vote as hethinks fit. The signature on an instrument appointing a proxy need not be witnessed.

Article 86

A vote given in accordance with the terms of an instrument of proxy (which for the purposes of theseArticles shall also include a power of attorney) shall be valid notwithstanding the previous death orinsanity of the principal or revocation of the proxy, or of the authority under which the proxy wasexecuted or the transfer of the share in respect of which the proxy is given, provided that no intimationin writing of such death, insanity, revocation or transfer shall have been received by the Company atthe Office (or such other place as may be specified for the deposit of instruments appointing proxies)before the commencement of the Meeting or adjourned Meeting (or in the case of a poll before the timeappointed for the taking of the poll) at which the proxy is used.

Article 87

Any corporation which is a Member may by resolution of its directors or other governing body authorisesuch person as it thinks fit to act as its representative at any Meeting of the Company or of any classof Members and the persons so authorised shall be entitled to exercise the same powers on behalf ofthe corporation as the corporation could exercise if it were an individual Member of the Company. TheCompany shall be entitled to treat a certificate under the seal of the corporation as conclusive evidenceof the appointment or revocation of appointment of a representative under this Article.”

The Rights of Shareholders in respect of Dividends

“Article 129

The Directors may, with the sanction of the Company, by Ordinary Resolution declare dividends but(without prejudice to the powers of the Company to pay interest on share capital as hereinbeforeprovided) no dividend shall be payable except out of the profits of the Company.

Article 130

Subject to the rights of holders of shares with special rights as to dividend (if any), all dividends shallbe declared and paid according to the amounts paid on the shares in respect whereof the dividend ispaid, but (for the purposes of this Article only) no amount paid on a share in advance of calls shall betreated as paid on the share. All dividends shall be apportioned and paid pro rata according to theamount paid on the shares during any portion or portions of the period in respect of which the dividendis paid, but if any share is issued on terms providing that it shall rank for dividend as from a particulardate such shares shall rank for dividend accordingly.

Article 131

Notwithstanding Article 130, if, and so far as in the opinion of the Directors, the profits of the Companyjustify such payments, the Directors may pay fixed preferential dividends on any express class ofshares carrying a fixed preferential dividend expressed to be payable on a fixed date on the half-yearlyor other dates (if any) prescribed for the payment thereof by the terms of issue of the shares, and


150

subject thereto may also from time to time pay to the holders of any other class of shares interimdividends thereon of such amounts and on such dates as they may think fit.

Article 132

If the Company issues shares at a premium, whether for cash or otherwise, the Directors shall transfera sum equal to the aggregate amount or value of the premiums to an account called the “SharePremium Account” and any amount for the time being standing to the credit of such account shall notbe applied in the payment of any cash dividend.

Article 133

No dividend or other moneys payable on or in respect of a share shall bear interest against theCompany.

Article 134

The Directors may deduct from any dividend or other moneys payable to any Member on or in respectof a share all sums of money (if any) presently payable by him to the Company on account of calls orin connection therewith, or any other account which the Company is required by law to withhold ordeduct.

Article 135

The Directors may retain any dividend or other moneys payable on or in respect of a share on whichthe Company has a lien and may apply the same in or towards satisfaction of the debts, liabilities orengagements in respect of which the lien exists.

Article 136

The Directors may retain the dividends payable on shares in respect of which any person is under theseArticles, as to the transmission of shares, entitled to become a Member, or which any person underthese Articles is entitled to transfer, until such person shall become a Member in respect of such sharesor shall duly transfer the same.

Article 137

The payment by the Directors of any unclaimed dividends or other moneys payable on or in respect ofa share into a separate account shall not constitute the Company a trustee in respect thereof. Alldividends unclaimed after being declared may be invested or otherwise made use of by the Directorsfor the benefit of the Company and any dividend unclaimed after a period of six years from the date ofdeclaration of such dividend may be forfeited and if so shall revert to the Company but the Directorsmay at any time thereafter at their absolute discretion annul any such forfeiture and pay the dividendso forfeited to the person entitled thereto prior to the forfeiture. For the avoidance of doubt no Membershall be entitled to any interest, share of revenue or other benefit arising from any unclaimed dividends,howsoever and whatsoever.

Article 138

The Company may, upon the recommendation of the Directors, by Ordinary Resolution direct paymentof a dividend in whole or in part by the distribution of specific assets and in particular of paid up sharesor debentures of any other company or in any one or more of such ways, and the Directors shall give


151

effect to such Resolution, and where any difficulty arises in regard to such distribution, the Directorsmay settle the same as they think expedient and in particular may issue fractional certificates and fixthe value for distribution of such specific assets or any part thereof and may determine that cashpayments shall be made to any Members upon the footing of the value so fixed in order to adjust therights of all parties and may vest any such specific assets in trustees as may seem expedient to theDirectors.

Article 138A

(1) Whenever the Directors or the Company in General Meeting have resolved or proposed that adividend (including an interim, final, special or other dividend) be paid or declared on the ordinaryshare capital of the Company, the Directors may further resolve that Members entitled to suchdividend be entitled to elect to receive an allotment of ordinary shares credited as fully paid in lieuof cash in respect of the whole or such part of the dividend as the Directors may think fit. In suchcase, the following provisions shall apply:

(i) the basis of any such allotment shall be determined by the Directors;

(ii) the Directors shall determine the manner in which Members shall be entitled to elect toreceive an allotment of ordinary shares credited as fully paid in lieu of cash in respect of thewhole or such part of any dividend in respect of which the Directors shall have passed sucha resolution as aforesaid, and the Directors may make such arrangements as to the givingof notice to Members, providing for forms of election for completion by Members (whetherin respect of a particular dividend or dividends or generally), determining the procedure formaking such elections or revoking the same and the place at which and the latest date andtime by which any forms of election or other documents by which elections are made orrevoked must be lodged, and otherwise make all such arrangements and do all such things,as the Directors consider necessary or expedient in connection with the provisions of thisArticle;

(iii) the right of election may be exercised in respect of the whole of that portion of the dividendin respect of which the right of election has been accorded provided that the Directors maydetermine, either generally or in any specific case, that such right shall be exercisable inrespect of the whole or any part of that portion;

(iv) the dividend (or that part of the dividend in respect of which a right of election has beenaccorded) shall not be payable in cash on ordinary shares in respect whereof the shareelection has been duly exercised (the “elected ordinary shares”) and in lieu and insatisfaction thereof ordinary shares shall be allotted and credited as fully paid to the holdersof the elected ordinary shares on the basis of allotment determined as aforesaid and for suchpurpose and notwithstanding the provisions of Article 142, the Directors shall (a) capitaliseand apply the amount standing to the credit of any of the Company’s reserve accounts(including share premium account and any capital redemption reserve funds) or any sumstanding to the credit of the profit and loss account or otherwise for distribution as theDirectors may determine, such sum as may be required to pay up in full (to the nominal valuethereof) the appropriate number of ordinary shares for allotment and distribution to andamong the holders of the elected ordinary shares on such basis or (b) apply the sum whichwould otherwise have been payable in cash to the holders of the elected ordinary sharestowards payment of the appropriate number of ordinary shares for allotment and distributionto and among the holders of the elected ordinary shares on such basis.


152

(2) (i) The ordinary shares allotted pursuant to the provisions of Article 138A(1) shall rank paripassu in all respects with the ordinary shares then in issue save only as regards participationin the dividend which is the subject of the election referred to above (including the right tomake the election referred to above) or any other distributions, bonuses or rights paid, made,declared or announced prior to or contemporaneous with the payment or declaration of thedividend which is the subject of the election referred to above, unless the Directors shallotherwise specify.

(ii) The Directors may do all acts and things considered necessary or expedient to give effectto any capitalisation pursuant to the provisions of Article 138A(1), with full power to makesuch provisions as they think fit in the case of shares becoming distributable in fractions(including, notwithstanding any provision to the contrary in these Articles, provisionswhereby, in whole or in part, fractional entitlements are aggregated and sold and the netproceeds distributed to those entitled, or are disregarded or rounded up or down, or wherebythe benefit of fractional entitlements accrues to the Company rather than to the Membersconcerned).

(3) The Directors may, on any occasion when they resolve as provided in Article 138A(1), determinethat rights of election under that paragraph shall not be made available to the persons who areregistered as holders of ordinary shares in the Register of Members or (as the case may be) inthe Depository Register, or in respect of ordinary shares the transfer of which is registered, aftersuch date as the Directors may fix subject to such exceptions as the Directors think fit, and in suchevent the provisions of this Article shall be read and construed subject to such determination.

(4) The Directors may, on any occasion when they resolve as provided in Article 138A(1), furtherdetermine that no allotment of shares or rights of election for shares under that paragraph shallbe made available or made to Members whose registered addresses entered in the Register ofMembers or (as the case may be) the Depository Register is outside Singapore or to such otherMembers or class of Members as the Directors may in their sole discretion decide and in suchevent the only entitlement of the Members aforesaid shall be to receive in cash the relevantdividend resolved or proposed to be paid or declared.

(5) Notwithstanding the foregoing provisions of this Article, if at any time after the Directors’ resolutionto apply the provisions of Article 138A(1) in relation to any dividend but prior to the allotment ofordinary shares pursuant thereto, the Directors shall consider that by reason of any event orcircumstance (whether arising before or after such resolution) or by reason of any matterwhatsoever it is no longer expedient or appropriate to implement that proposal, the Directors mayat their absolute discretion and without assigning any reason therefor, cancel the proposedapplication of Article 138A(1).

Article 139

Any dividend or other moneys payable in cash on or in respect of a share may be paid by cheque orwarrant sent through the post to the registered address of the Member or person entitled thereto or, ifseveral persons are registered as joint holders of the share or are entitled thereto in consequence ofthe death or bankruptcy of the holder, to any one of such persons or to such person and such addressas such persons may by writing direct Provided that where the Member is a Depositor, the payment bythe Company to the Depository of any dividend payable to a Depositor shall to the extent of thepayment discharge the Company from any further liability in respect of the payment. Every such chequeand warrant shall be made payable to the order of the person to whom it is sent or to such person asthe holder or joint holders or person or persons entitled to the share in consequence of the death orbankruptcy of the holder may direct and payment of the cheque if purporting to be endorsed or the


153

receipt of any such person shall be a good discharge to the Company. Every such cheque and warrantshall be sent at the risk of the person entitled to the money represented thereby.

Article 140

A transfer of shares shall not pass the right to any dividend declared on such shares before theregistration of the transfer.”


154

The audited consolidated financial statements of the Company for FY 2007 and the accompanyingreport by the auditors of the Company to the members of the Company have been extracted from theCompany’s 2007 Annual Report (“Annual Report”) and pages mentioned herein refer to thecorresponding pages in the Annual Report.

INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OFDATACRAFT ASIA LTD

We have audited the accompanying financial statements of Datacraft Asia Ltd (the Company) and itssubsidiaries (the Group) which comprise the balance sheets of the Group and the Company as atSeptember 30, 2007, the profit and loss statement, statement of changes in equity and cash flowstatement of the Group and the statement of changes in equity of the Company for the year then ended,and a summary of significant accounting policies and other explanatory notes, as set out on pages 82to 130.

Directors’ Responsibility

The Company’s directors are responsible for the preparation and fair presentation of these financialstatements in accordance with Singapore Financial Reporting Standards and the SingaporeCompanies Act, Cap. 50 (the “Act”). This responsibility includes: designing, implementing andmaintaining internal control relevant to the preparation and fair presentation of financial statements thatare free from material misstatement, whether due to fraud or error; selecting and applying appropriateaccounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. Weconducted our audit in accordance with Singapore Standards on Auditing. Those standards require thatwe comply with ethical requirements and plan and perform the audit to obtain reasonable assurancewhether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosuresin the financial statements. The procedures selected depend on the auditor’s judgement, including theassessment of the risks of material misstatement of the financial statements, whether due to fraud orerror. In making those risk assessments, the auditor considers internal control relevant to the entity’spreparation and fair presentation of the financial statements in order to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectivenessof the entity’s internal control. An audit also includes evaluating the appropriateness of accountingpolicies used and the reasonableness of accounting estimates made by directors, as well as evaluatingthe overall presentation of the financial statements. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion.

APPENDIX 5: AUDITED CONSOLIDATED FINANCIAL STATEMENTS OFTHE COMPANY FOR FY 2007

155

Opinion

In our opinion,

(a) the consolidated financial statements of the Group and the balance sheet and statement ofchanges in equity of the Company are properly drawn up in accordance with the provisions of theAct and Singapore Financial Reporting Standards so as to give a true and fair view of the stateof affairs of the Group and of the Company as at September 30, 2007 and of the results, changesin equity and cash flows of the Group and changes in equity of the Company for the year endedon that date; and

(b) the accounting and other records required by the Act to be kept by the Company and by thosesubsidiaries incorporated in Singapore of which we are the auditors have been properly kept inaccordance with the provisions of the Act.

Deloitte & ToucheCertified Public AccountantsSingapore

Prakash Ambelal DesaiPartnerAppointed on February 27, 2003

November 28, 2007


156

DATACRAFT ASIA LTD

BALANCE SHEETSSeptember 30, 2007

The Group The CompanyNote 2007 2006 2007 2006

US$’000 US$’000 US$’000 US$’000(restated)(a)

ASSETS

Current assets

Cash and cash equivalents 6 150,491 151,364 10,785 8,267

Trade receivables 7 134,494 112,145 45,566 73,145

Other receivables and prepayments 8 35,818 29,846 2,903 1,925

Inventories 9 10,163 9,524 – –

Total current assets 330,966 302,879 59,254 83,337

Non-current assets

Investment in associates 10 – – – –

Investment in subsidiaries 11 – – 107,727 99,602

Investment in joint venture 12 – – 408 –

Amount due from subsidiary 13 – – 9,966 3,170

Plant and equipment 14 14,337 12,934 2,364 2,316

Goodwill 15 648 648 – –

Available-for-sale investments 16 1,216 1,157 – –

Deferred tax assets 17 1,533 2,592 – –

Total non-current assets 17,734 17,331 120,465 105,088

Total assets 348,700 320,210 179,719 188,425

LIABILITIES AND EQUITY

Current liabilities

Trade and other payables 18 133,929 118,780 23,105 32,128

Income tax payable 9,128 7,877 3,107 3,165

Provisions 19 1,521 1,063 213 122

Current portion of finance leases 20 – 26 – –

Total current liabilities 144,578 127,746 26,425 35,415


Finance leases 20 – 19 – –

Deferred tax liabilities 17 634 795 268 346

Total non-current liabilities 634 814 268 346


157

The Group The CompanyNote 2007 2006 2007 2006

US$’000 US$’000 US$’000 US$’000(restated)(a)

Capital and reserves

Issued capital 22 139,999 139,999 139,999 139,999

Treasury shares 23 (23,697) (17,462) (23,697) (17,462)

Share options settlement reserve (37) (28) (37) (28)

Share options reserve 4,596 4,258 4,596 4,258

Statutory reserve 500 405 – –

Exchange difference reserve 6,696 (1,776) – –

Goodwill on consolidation (130,415) (149,751) – –

Retained earnings 204,894 215,172 32,165 25,897

Equity attributable to equity holders of theCompany 202,536 190,817 153,026 152,664

Minority interests 952 833 – –

Total equity 203,488 191,650 153,026 152,664

Total liabilities and equity 348,700 320,210 179,719 188,425

(a) Restated to include effects of adoption of the Amendments to FRS 39 relating to financial guarantee contracts applicableto the Company. Please refer to Note 2.

See accompanying notes to financial statements.


158

DATACRAFT ASIA LTD

CONSOLIDATED PROFIT AND LOSS STATEMENTYear ended September 30, 2007

The GroupNote 2007 2006

US$’000 US$’000

Revenue 24 580,829 482,157

Cost of sales (470,009) (391,722)

Gross profit 110,820 90,435

Other operating income 25 4,226 9,544

Other expenses:

Distribution and sales (46,757) (40,832)

Administrative(b) (27,063) (23,772)

Finance costs 26 (50) (104)

Profit before income tax 41,176 35,271

Income tax 27 (10,872) (9,012)

Profit for the year 28 30,304 26,259

Attributable to:

Equity holders of the Company 30,316 26,314

Minority interests (12) (55)

30,304 26,259

Earnings per ordinary share US Cents US Cents

Basic 30 6.76 5.68

Fully diluted 30 6.71 5.66

(b) Included in the administrative expenses is the share-based payments expense of US$1,352,000 (2006: US$1,537,000).



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DATACRAFT ASIA LTD

CONSOLIDATED CASH FLOW STATEMENTYear ended September 30, 2007

Note 2007 2006US$’000 US$’000

Operating activitiesProfit before income tax 41,176 35,271Adjustments for:

Allowance for inventories 317 422Share options expense 1,352 1,537Depreciation 7,772 7,915Interest expense 50 104Interest income (4,143) (3,549)Loss on disposal of plant and equipment 26 208Allowance for doubtful trade receivables 250 199Provision for employees’ benefits 19 444 128Loss on liquidation of subsidiaries (Note A) 524 –

Operating profit before working capital changes 47,768 42,235Inventories (645) 6,258Trade and other receivables (19,360) 649Trade and other payables 10,048 16,768

Cash generated from operations 37,811 65,910Interest paid (50) (104)Interest received 4,143 3,549Income tax paid (11,948) (8,726)Employees’ benefits utilised 19 (57) (316)

Net cash from operating activities 29,899 60,313

Investing activitiesProceeds from disposal of plant and equipment 75 37Purchase of plant and equipment (8,648) (6,223)Increase in available-for-sale investment – (32)

Net cash used in investing activities (8,573) (6,218)

Financing activitiesNet proceeds from reissue of treasury shares upon option exercise 457 667Payment of finance leases (45) (2)Fixed deposits pledged as security – 1,204Cash settlement of share options exercised by employees (862) (120)Purchase of treasury shares (6,853) (17,689)Dividends paid 29 (21,250) –

Net cash used in financing activities (28,553) (15,940)

Net effect of exchange rate changes in consolidating subsidiaries 6,354 778Net (decrease) increase in cash and cash equivalents (873) 38,933Cash and cash equivalents at beginning of financial year 151,364 112,431

Cash and cash equivalents at end of financial year 6 150,491 151,364

Note

(A) In the current financial year, the Group commenced liquidation procedures for two subsidiaries. As at September 30, 2007,one of the subsidiaries was still in the process of liquidation. There is no material effect on the Group’s cash flow statement.Translation differences of these subsidiaries amounting to US$524,000 were recognised in the profit and loss statement inaccordance with the Group’s accounting policies.



164

DATACRAFT ASIA LTD

NOTES TO FINANCIAL STATEMENTSSeptember 30, 2007

1 GENERAL

The Company (Registration No. 199301842Z) is incorporated in Singapore with its registeredoffice and principal place of business at 6 Temasek Boulevard, #26-01/05 Suntec Tower Four,Singapore 038986. The Company is listed on the mainboard of the Singapore ExchangeSecurities Trading Limited. The financial statements are expressed in United States dollars.

The principal activities of the Company are those of a management and investment holdingcompany.

The principal activities of the subsidiaries are set out in Note 11 to the financial statements.

The consolidated financial statements of the Group and balance sheet and statement of changesin equity of the Company for the year ended September 30, 2007 were authorised for issue by theBoard of Directors on November 28, 2007.

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF ACCOUNTING — The financial statements are prepared in accordance with thehistorical cost convention, except as described in the accounting policies below, and are drawn upin accordance with the provisions of the Singapore Companies Act and Singapore FinancialReporting Standards (“FRS”).

In the current financial year, the Group has adopted all the new and revised FRSs andInterpretations of FRS (“INT FRS”) issued that are relevant to its operations and effective forannual periods beginning on or after October 1, 2006. The adoption of these new/revised FRSsand INT FRSs does not result in changes to the Group’s and Company’s accounting policies andhas no material effect on the amounts reported for the current or prior years except as disclosedbelow and in the notes to the financial statements.

Amendments to FRS 39 relating to financial guarantee contracts

The amendments require certain financial guarantee contracts to be recognised in accordancewith FRS 39 and measured initially at fair values, and subsequently at the higher of the amountrecognised as a provision and the amount initially recognised less cumulative amortisation inaccordance with the revenue recognition policies described below. The changes introduced bythese amendments are applied by the Company with effect from the beginning of the comparativereporting period presented in the financial statements (that is, with effect from October 1, 2005).The Company is a party to a financial guarantee contract where the Company has providedfinancial guarantees to certain banks or financial institutions in respect of banking or creditfacilities provided to certain subsidiaries.

The impact of this change in accounting policy in the Company’s financial statements at thebeginning of the comparative period is the recognition of a deemed investment in subsidiaries forfinancial guarantee contracts of US$164,000 with a corresponding adjustment against openingretained earnings. The Company’s profit for the year ended September 30, 2006 is US$494,000higher under the new accounting policy and investments in subsidiaries as at September 30, 2006


165

is higher by US$658,000 from that which was reported in the 2006 financial statements. TheCompany’s profit for the year ended September 30, 2007 is US$499,000 higher under the newaccounting policy.

The adoption of amendments to FRS 39 relating to financial guarantee contracts does not haveany financial impact on the Group’s financial statements.

At the date of authorisation of these financial statements, the following FRSs and INT FRSsrelevant to the Group were issued but not effective:

FRS 107 — Financial Instruments: Disclosures

FRS 108 — Operating Segments

INT FRS 110 — Interim Financial Reporting and Impairment

INT FRS 111 — FRS 102 — Group and Treasury Share Transactions

Amendments to FRS 1 Presentation of Financial Statements on Capital Disclosures.

The application of FRS 107 will not affect any of the amounts recognised in the financialstatements of the Company and of the Group, but will change the disclosures presently made inrelation to the Company and Group’s financial instruments and the objectives, policies andprocesses for managing capital.

Other than FRS 107, the directors anticipate that the adoption of the above FRSs and INT FRSsin future periods will have no material impact on the financial statements of the Company and ofthe Group in the period of their initial adoption.

BASIS OF CONSOLIDATION — The consolidated financial statements incorporate the financialstatements of the Company and entities (including special purpose entities) controlled by theCompany (its subsidiaries). Control is achieved when the Company has the power to govern thefinancial and operating policies of an entity so as to obtain benefits from its activities.

The results of subsidiaries acquired or disposed of during the year are included in theconsolidated profit and loss statement from the effective date of acquisition or up to the effectivedate of disposal, as appropriate.

Where necessary, adjustments are made to the financial statements of subsidiaries to bring theaccounting policies used into line with those used by other members of the Group.

All intra-group transactions, balances, income and expenses are eliminated on consolidation.

Minority interests in the net assets of consolidated subsidiaries are identified separately from theGroup’s equity therein. Minority interests consist of the amount of those interests at the date of theoriginal business combination (see below) and the minority’s share of changes in equity since thedate of the combination. Losses applicable to the minority in excess of the minority’s interest inthe subsidiary’s equity are allocated against the interests of the Group except to the extent thatthe minority has a binding obligation and is able to make an additional investment to cover itsshare of those losses.

In the Company’s financial statements, investments in subsidiaries and joint venture are carriedat cost less any impairment in net recoverable value that has been recognised in the profit andloss statement.


166

When a sale and purchase agreement provides for an adjustment to the purchase considerationcontingent on one or more future events, the Company includes the amount of the adjustmentreferred to as Deferred Purchase Consideration in the cost of investment at the acquisition dateif the adjustment is probable and can be measured reliably. If the future events do not occur or theestimate needs to be revised, the cost of investment is adjusted accordingly.

BUSINESS COMBINATIONS — The acquisition of subsidiaries is accounted for using thepurchase method. The cost of the acquisition is measured at the aggregate of the fair values, atthe date of exchange, of assets given, liabilities incurred or assumed, and equity instrumentsissued by the Group in exchange for control of the acquiree, plus any costs directly attributableto the business combination. The acquiree’s identifiable assets, liabilities and contingent liabilitiesthat meet the conditions for recognition under FRS 103 are recognised at their fair values at theacquisition date, except for non-current assets (or disposal groups) that are classified as held forsale in accordance with FRS 105 Non-Current Assets Held for Sale and Discontinued Operations,which are recognised and measured at fair value less costs to sell.

Goodwill arising on acquisition is recognised as an asset and initially measured at cost, being theexcess of the cost of the business combination over the Group’s interest in the net fair value ofthe identifiable assets, liabilities and contingent liabilities recognised. If, after reassessment, theGroup’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingentliabilities exceeds the cost of the business combination, the excess is recognised immediately inthe consolidated profit and loss statement.

The interest of minority shareholders in the acquiree is initially measured at the minority’sproportion of the net fair value of the assets, liabilities and contingent liabilities recognised.

FINANCIAL INSTRUMENTS — Financial assets and financial liabilities are recognised on theGroup’s balance sheet when the Group becomes a party to the contractual provisions of theinstrument.

Financial assets

Investments are recognised and de-recognised on a trade date where the purchase or sale of aninvestment is under a contract whose terms require delivery of the investment within thetimeframe established by the market concerned, and are initially measured at fair value, net oftransaction costs except for those financial assets classified as at fair value through profit or loss.

Effective interest method

The effective interest method is a method of calculating the amortised cost of a financialinstrument and of allocating interest income or expense over the relevant period. The effectiveinterest rate is the rate that exactly discounts estimated future cash receipts or payments throughthe expected life of the financial instrument, or where appropriate, a shorter period. Income isrecognised on an effective interest rate basis for debt instruments other than those financialinstruments “at fair value through profit or loss”.

Trade and other receivables

Trade and other receivables are measured at initial recognition at fair value, and are subsequentlymeasured at amortised cost using the effective interest rate method. The carrying amounts oftrade and other receivables approximate their fair values due to the relatively short-term maturityof these financial instruments. Appropriate allowances for estimated irrecoverable amounts are


167

recognised in the profit and loss statement when there is objective evidence that the asset isimpaired. The allowance recognised is measured as the difference between the asset’s carryingamount and the present value of estimated future cash flows discounted at the effective interestrate computed at initial recognition.

Impairment of financial assets

Financial assets, other than those at fair value through profit or loss, are assessed for indicatorsof impairment at each balance sheet date. Financial assets are impaired where there is objectiveevidence that, as a result of one or more events that occurred after the initial recognition of thefinancial asset, the estimated future cash flows of the investment have been impacted. Forfinancial assets carried at amortised cost, the amount of the impairment is the difference betweenthe asset’s carrying amount and the present value of estimated future cash flows, discounted atthe original effective interest rate.

The carrying amount of the financial asset is reduced by the impairment loss directly for allfinancial assets with the exception of trade receivables where the carrying amount is reducedthrough the use of an allowance account. When a trade receivable is uncollectible, it is written offagainst the allowance account. Subsequent recoveries of amounts previously written off arecredited to profit or loss. Changes in the carrying amount of the allowance account are recognisedin the profit and loss statement.

With the exception of available-for-sale equity investments, if, in a subsequent period, the amountof the impairment loss decreases and the decrease can be related objectively to an eventoccurring after the impairment loss was recognised, the previously recognised impairment loss isreversed through profit and loss statement to the extent the carrying amount of the financialassets at the date the impairment is reversed does not exceed what the amortised cost wouldhave been had the impairment not been recognised.

In respect of available-for-sale equity instruments, any subsequent increase in fair value after animpairment loss, is recognised directly in equity.

Available-for-sale financial assets

Certain shares and debt securities held by the Group are classified as being available for sale andare stated at fair value. Fair value is determined in the manner described in Note 16. Gains andlosses arising from changes in fair value are recognised directly in the revaluation reserve with theexception of impairment losses, interest calculated using the effective interest method and foreignexchange gains and losses on monetary assets which are recognised directly in profit or loss.Where the investment is disposed of or is determined to be impaired, the cumulative gain or losspreviously recognised in the revaluation reserve is included in profit or loss for the period.Dividends on available-for-sale equity instruments are recognised in profit or loss when theGroup’s right to receive payments is established. The fair value of available-for-sale monetaryassets denominated in a foreign currency is determined in that foreign currency and translated atthe spot rate at reporting date. The change in fair value attributable to translation differences thatresult from a change in amortised cost of the asset is recognised in profit or loss, and otherchanges are recognised in equity.

Cash and cash equivalents

Cash and bank balances comprise cash on hand, bank balances and fixed deposits that arereadily convertible to a known amount of cash and are subject to an insignificant risk of changesin value.


168

Financial liabilities and equity instruments

Classification as debt or equity

Financial liabilities and equity instruments issued by the Group are classified according to thesubstance of the contractual arrangements entered into and the definitions of a financial liabilityand an equity instrument.

Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of the Groupafter deducting all of its liabilities. Equity instruments are recorded at the proceeds received, netof direct issue costs.

Trade and other payables

Trade and other payables are initially measured at fair value, net of transaction costs, and aresubsequently measured at amortised cost, using the effective interest rate method. The carryingamounts of trade and other payables approximate their fair values due to the relatively short-termmaturity of these financial instruments.

Derivative financial instruments and hedge accounting

The Group’s activities expose it primarily to the financial risks of changes in foreign exchangerates.

The Group uses derivative financial instruments (primarily foreign currency forward contracts) tohedge its risks associated with foreign currency fluctuations relating to certain firm commitmentsand forecasted transactions.

The Group does not use derivative financial instruments for speculative purposes.

Derivative financial instruments are initially measured at fair value at the date the derivativecontract is entered, and are subsequently remeasured to their fair value at each balance sheetdate. Changes in the fair value of derivative financial instruments that do not qualify for hedgeaccounting are recognised in the profit and loss statement as they arise.

The Group designates certain hedging instruments, which include derivatives, embeddedderivatives and non-derivatives in respect of foreign currency risk, as either fair value hedges,cash flow hedges, or hedges of net investments in foreign operations. Hedges of foreignexchange risk on firm commitments are accounted for as cash flow hedges.

At the inception of the hedge relationship the entity documents the relationship between thehedging instrument and hedged item, along with its risk management objectives and its strategyfor undertaking various hedge transactions. Furthermore, at the inception of the hedge and on anongoing basis, the Group documents whether the hedging instrument that is used in a hedgingrelationship is highly effective in offsetting changes in fair values or cash flows of the hedged item.

Changes in the fair value of derivative financial instruments that are designated and effective ashedges of future cash flows are recognised directly in equity and the ineffective portion isrecognised immediately in profit or loss. If the cash flow hedge of a firm commitment or forecasttransaction results in the recognition of an asset or a liability, then, at the time the asset or liabilityis recognised, the associated gains or losses on the derivative that had previously been


169

recognised in equity are included in the initial measurement of the asset or liability. For hedgesthat do not result in the recognition of an asset or a liability, amounts deferred in equity arerecognised in profit or loss in the same period in which the hedged item affects the profit and lossstatement.

Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, orexercised, or no longer qualifies for hedge accounting. At that time, for forecast transactions, anycumulative gain or loss on the hedging instrument recognised in equity is retained in equity untilthe forecast transaction occurs. If a hedged transaction is no longer expected to occur, the netcumulative gain or loss recognised in equity is transferred to the profit or loss for the period.

Embedded derivatives

Derivatives embedded in other financial instruments or other non-financial host contracts aretreated as separate derivatives when their risks and characteristics are not closely related tothose of the host contract and the host contract is not carried at fair value with unrealised gainsor losses reported in profit or loss. They are fair valued with the changes in fair values taken tothe profit and loss statement for the period.

Treasury shares

When the Company purchases its own equity shares, the consideration paid, including anydirectly attributable costs, is taken against Treasury Shares within equity. When the shares aresubsequently disposed, the realised gains or losses on disposal of the treasury shares areincluded in capital reserves of the Company.

The Company acquires its own shares from the open market for delivery to employees uponexercise of Options under the Previous Scheme and the Scheme 2003. Such shares aredesignated as treasury shares.

LEASES — Leases are classified as finance leases whenever the terms of the lease transfersubstantially all the risks and rewards of ownership to the lessee. All other leases are classifiedas operating leases.

Assets held under finance leases are recognised as assets of the Group at their fair value at theinception of the lease or, if lower, at the present value of the minimum lease payments. Thecorresponding liability to the lessor is included in the balance sheet as a finance lease obligation.Lease payments are apportioned between finance charges and reduction of the lease obligationso as to achieve a constant rate of interest on the remaining balance of the liability. Financecharges are charged directly to profit and loss statement.

Rental payable under operating leases is charged to profit and loss on a straight-line basis overthe term of the relevant lease.

In the event that lease incentives are received to enter into operating leases, such incentives arerecognised as a liability. The aggregate benefit of incentives is recognised as a reduction of rentalexpense on a straight-line basis, except where another systematic basis is more representativeof the time pattern in which economic benefits from the leased asset are consumed.

INVENTORIES — Inventories, comprising mainly data communication equipment, are stated atthe lower of cost and net realisable value. In general, cost is determined on the first-in, first-outbasis and includes all costs incurred in bringing the inventories to their present location and


170

condition. Net realisable value represents the estimated selling price less all estimated costs andcosts to be incurred in marketing, selling and distribution. Allowance is made where necessary forobsolete, slow-moving and defective inventories.

INTERESTS IN JOINT VENTURES — A joint venture is a contractual arrangement whereby theGroup and other parties undertake an economic activity that is subject to joint control, that is whenthe strategic financial and operating policy decisions relating to the activities require theunanimous consent of the parties sharing control.

Joint venture arrangements that involve the establishment of a separate entity in which eachventurer has an interest are referred to as jointly controlled entities. The Group reports its interestsin jointly controlled entities using proportionate consolidation, except when the investment isclassified as held for sale, in which case it is accounted for under FRS 105 Non-current AssetsHeld for Sale and Discontinued Operations. The Group’s share of the assets, liabilities, incomeand expenses of jointly controlled entities are combined with the equivalent items in theconsolidated financial statements on a line-by-line basis.

Any goodwill arising on the acquisition of the Group’s interest in a jointly controlled entity isaccounted for in accordance with the Group’s accounting policy for goodwill arising on theacquisition of a subsidiary (see below).

Where the Group transacts with its jointly controlled entities, unrealised profits and losses areeliminated to the extent of the Group’s interest in the joint venture.

PLANT AND EQUIPMENT — Plant and equipment are carried at cost, less accumulateddepreciation and any impairment loss where the recoverable amount of the asset is estimated tobe lower than its carrying amount.

Depreciation is charged so as to write off the cost of assets on a straight-line basis over theestimated useful lives of the assets concerned. The annual rates used for this purpose are:

Motor vehicles – 16.67% to 25%

Maintenance, workshop and demonstration equipment – 10% to 40%

Furniture, fittings and equipment – 15% to 30%

Fully depreciated assets are retained in the financial statements until they are no longer in use.

The estimated useful lives, residual values and depreciation method are reviewed at each yearend, with the effect of any changes in estimate accounted for on a prospective basis.

Assets held under finance leases are depreciated over their expected useful lives on the samebasis as owned assets or, where shorter, the term of the relevant lease.

The gain or loss arising on disposal or retirement of an item of plant and equipment is determinedas the difference between the sales proceeds and the carrying amounts of the asset and isrecognised in the profit and loss statement.

GOODWILL — Goodwill arising on the acquisition of a subsidiary or a jointly controlled entityrepresents the excess of the cost of acquisition over the Group’s interest in the net fair value ofthe identifiable assets, liabilities and contingent liabilities of the subsidiary or jointly controlledentity recognised at the date of acquisition. Prior to July 1, 2001, goodwill arising from acquisition


171

of subsidiaries was directly adjusted against shareholders’ equity and such goodwill has not beenretrospectively capitalised and amortised as allowed under Singapore Statements of AccountingStandards (“SAS”) No. 22 – Business Combinations. With effect from July 1, 2001, the Groupadopted SAS 22 and amortised goodwill over a period of 7 years.

With effect from October 1, 2004, the Group adopted FRS 103 Business Combinations andgoodwill is now recognised as an asset at cost and is subsequently measured at cost less anyaccumulated impairment losses. FRS 103 is applied prospectively. The option of limitedretrospective application of FRS 103 has not been taken up, thus avoiding the need to restate pastbusiness combinations.

For the purpose of impairment testing, goodwill is allocated to each of the Group’s cash-generating units expected to benefit from the synergies of the combination. Cash-generating unitsto which goodwill has been allocated are tested for impairment annually, or more frequently whenthere is an indication that the unit may be impaired. If the recoverable amount of thecash-generating unit is less than the carrying amount of the unit, the impairment loss is allocatedfirst to reduce the carrying amount of any goodwill allocated to the unit and then to the otherassets of the unit pro-rata on the basis of the carrying amount of each asset in the unit. Animpairment loss recognised for goodwill is not reversed in a subsequent period.

On disposal of a subsidiary or a jointly controlled entity, the attributable amount of goodwill isincluded in the determination of the profit or loss on disposal. Goodwill on acquisition ofsubsidiaries charged to shareholders’ equity previously is not taken into account in determiningthe profit or loss on disposal or discontinuance of business of the relevant subsidiaries.

IMPAIRMENT OF ASSETS EXCLUDING GOODWILL — At each balance sheet date, theCompany and the Group review the carrying amounts of their tangible assets to determinewhether there is any indication that those assets have suffered an impairment loss. If any suchindication exists, the recoverable amount of the asset is estimated in order to determine the extentof the impairment loss (if any). Where it is not possible to estimate the recoverable amount of anindividual asset, the Company and the Group estimate the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessingvalue in use, the estimated future cash flows are discounted to their present value using a pre-taxdiscount rate that reflects current market assessments of the time value of money and the risksspecific to the asset.

If the recoverable amount of an asset or cash-generating unit is estimated to be less than itscarrying amount, the carrying amount of the asset or cash-generating unit is reduced to itsrecoverable amount. An impairment loss is recognised immediately in the profit and lossstatement.

When an impairment loss subsequently reverses, the carrying amount of the asset or cash-generating unit is increased to the revised estimate of its recoverable amount, but only to theextent that the increased carrying amount does not exceed the carrying amount that would havebeen determined had no impairment loss been recognised for the asset or cash-generating unitin prior years. A reversal of an impairment loss is recognised as income immediately.


172

PROVISIONS — Provisions are recognised when the Company and the Group has a presentobligation (legal or constructive) as a result of a past event, it is probable that the Company andthe Group will be required to settle that obligation, and a reliable estimate can be made of theamount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settlethe present obligation at the balance sheet date, taking into account the risks and uncertaintiessurrounding the obligation. Where a provision is measured using the cash flows estimated tosettle the present obligation, its carrying amount is the present value of those cash flows.

When some or all of the economic benefits required to settle a provision are expected to berecovered from a third party, the receivable is recognised as an asset if it is virtually certain thatreimbursement will be received and the amount of the receivable can be measured reliably.

SHARE-BASED PAYMENTS — The Group issues equity-settled share-based payments tocertain employees. Equity-settled share-based payments are measured at fair value (excludingthe effect of non market-based vesting conditions) at the date of grant. The fair value determinedat the grant date of the equity-settled share-based payments is expensed on a straight-line basisover the vesting period, based on the Group’s estimate of shares that will eventually vest andadjusted for the effect of non market-based vesting conditions.

For cash-settled share-based payments, a liability equal to the portion of the goods or servicesreceived is recognised at the current fair value determined at each balance sheet date.

Fair value is measured using the Binomial pricing model. The assumptions included in the modelare management’s best estimate for the effects of non-transferability, exercise restrictions andbehavioural considerations.

REVENUE RECOGNITION — Revenue is measured at the fair value of the considerationreceived or receivable for goods and services provided in the normal course of business, net ofdiscounts and sales related taxes.

(i) Revenue from sale of products is recognised upon acceptance of delivery by the client whenrevenue and costs of transaction can be measured reliably.

(ii) Income from maintenance contracts is apportioned over the period covered by themaintenance contracts.

(iii) Service income is recognised by reference to the stage of completion of the transaction atthe balance sheet date determined by services performed to date as a percentage of totalservices.

(iv) Revenue from training is recognised in the period in which training is provided.

(v) Management and technical fee income is recognised when services are rendered.

(vi) Dividend income is recognised when the shareholders’ rights to receive payment has beenestablished.

(vii) Income from providing financial guarantee is recognised in profit or loss over the guaranteeperiod on a straight line basis.

(viii) Interest and investment income is accrued on a time basis, by reference to the principaloutstanding and at the effective interest rate.


173

RETIREMENT BENEFIT COSTS — Payments to defined contribution retirement benefit plansare charged as an expense as they fall due. Payments made to state-managed retirement benefitschemes, such as the Singapore Central Provident Fund, are dealt with as payments to definedcontribution plans where the Group’s obligations under the plans are equivalent to those arisingin a defined contribution retirement benefit plan.

TERMINATION BENEFITS — Under the labour laws in certain countries where the Groupoperates, employees are entitled to receive severance indemnities irrespective of the reason forthe employment termination subject to certain minimum service requirements. Provision is madein the financial statements based on the number of years of service rendered by qualifyingemployees and the last-drawn salary at the balance sheet date.

EMPLOYEE LEAVE ENTITLEMENT — Employee entitlements to annual leave are recognisedwhen they accrue to employees. A provision is made for the estimated liability for annual leave asa result of services rendered by employees up to the balance sheet date.

INCOME TAX — Income tax expense represents the sum of the tax currently payable anddeferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from profitas reported in the profit and loss statement because it excludes items of income or expense thatare taxable or deductible in other years and it further excludes items that are not taxable or taxdeductible. The Group’s liability for current tax is calculated using tax rates that have beenenacted or substantively enacted in countries where the Company and the subsidiaries operateby the balance sheet date.

Deferred tax is recognised on differences between the carrying amounts of assets and liabilitiesin the financial statements and the corresponding tax bases used in the computation of taxableprofit, and are accounted for using the balance sheet liability method. Deferred tax liabilities aregenerally recognised for all taxable temporary differences and deferred tax assets are recognisedto the extent that it is probable that taxable profits will be available against which deductibletemporary differences can be utilised. Such assets and liabilities are not recognised if thetemporary difference arises from goodwill or from the initial recognition (other than in a businesscombination) of other assets and liabilities in a transaction that affects neither the taxable profitnor the accounting profit.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments insubsidiaries, except where the Group is able to control the reversal of the temporary differenceand it is probable that the temporary difference will not reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reducedto the extent that it is no longer probable that sufficient taxable profits will be available to allow allor part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liabilityis settled or the asset realised. Deferred tax is charged or credited to profit or loss.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set offcurrent tax assets against current tax liabilities and when they relate to income taxes levied by thesame taxation authority and the Group intends to settle its current tax assets and liabilities on anet basis.


174

FOREIGN CURRENCY TRANSACTIONS AND TRANSLATION — The individual financialstatements of each Group entity are presented in the currency of the primary economicenvironment in which the entity operates (its functional currency). The consolidated financialstatements of the Group and the balance sheet of the Company are presented in United Statesdollars, which is the functional currency of the Company, and the presentation currency for theconsolidated financial statements.

In preparing the financial statements of the individual entities, transactions in currencies otherthan the entity’s functional currency are recorded at the rates of exchange prevailing on the dateof the transaction. At each balance sheet date, monetary items denominated in foreign currenciesare retranslated at the rates prevailing on the balance sheet date. Non-monetary items carried atfair value that are denominated in foreign currencies are retranslated at the rates prevailing on thedate when the fair value was determined. Non-monetary items that are measured in terms ofhistorical cost in a foreign currency are not retranslated.

In order to hedge its exposure to certain foreign exchange risks, the Group enters into forwardcontracts (please see above for details of the Group’s accounting policies in respect of suchderivative financial instruments).

Exchange differences arising on the settlement of monetary items, and on retranslation ofmonetary items are included in profit or loss for the period. Exchange differences arising on theretranslation of non-monetary items carried at fair value are included in profit or loss for the periodexcept for differences arising on the retranslation of non-monetary items in respect of which gainsand losses are recognised directly in equity. For such non-monetary items, any exchangecomponent of that gain or loss is also recognised directly in equity.

For the purpose of presenting consolidated financial statements, the assets and liabilities of theGroup’s foreign operations (including comparatives) are expressed in United States dollars usingexchange rates prevailing on the balance sheet date. Income and expense items (includingcomparatives) are translated at the average exchange rates for the period, unless exchange ratesfluctuated significantly during that period, in which case the exchange rates at the dates of thetransactions are used. Exchange differences arising, if any, are classified as equity andtransferred to the Group’s foreign exchange translation reserve. Such translation differences arerecognised in profit or loss in the period in which the foreign operation is disposed of.

On consolidation, exchange differences arising from the translation of the net investment inforeign entity (including monetary items that, in substance, form part of the net investment inforeign entity), are taken to the foreign currency translation reserve.

Exchange differences arising on a monetary item that forms part of the Company’s net investmentin a foreign operation is recognised in profit or loss in the separate financial statements of theCompany.

Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treatedas assets and liabilities of the foreign operation and translated at the closing rate.


175

3 CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATIONUNCERTAINTY

In the application of the Group’s accounting policies, which are described in Note 2, managementis required to make judgements, estimates and assumptions about the carrying amounts of assetsand liabilities that are not readily apparent from other sources. The estimates and associatedassumptions are based on historical experience and other factors that are considered to berelevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions toaccounting estimates are recognised in the period in which the estimate is revised if the revisionaffects only that period, or in the period of the revision and future periods if the revision affectsboth current and future periods.

Critical judgements in applying the entity’s accounting policies

In the application of the Group’s accounting policies, which are described in Note 2 above, themanagement is of the opinion that there are no instances of application of judgment that areexpected to have a significant effect on the amounts recognised in the accounts.

Key sources of estimation uncertainty

The key assumptions concerning the future and other key sources of estimation uncertainty at thebalance sheet date that have a significant risk of causing a material adjustment to the carryingamounts of assets and liabilities within the next financial year are discussed below.

Impairment of investments in subsidiaries

Determining whether investments in subsidiaries are impaired requires an estimation of the valuein use of the investments and the cash-generating units to which the investments have beenallocated. The value in use calculation requires the entity to estimate the future cash flowsexpected to arise from the asset or cash-generating unit and a suitable discount rate in order tocalculate present value.

The carrying amount of investments in subsidiaries in the Company’s financial statements at thebalance sheet date was US$77,710,000 (2006: US$66,279,000) which is net of an accumulatedimpairment loss of US$49,716,000 (2006: US$75,387,000).

Allowances for impairment in trade and other receivables

The Group makes allowances for impairment in trade receivables based on an assessment of therecoverability of trade and other receivables. Allowances are applied to trade and otherreceivables where events or changes in circumstances indicate that the balances may not becollectible. The identification of bad and doubtful debts requires the use of estimates. Where theexpectation is different from the original estimate, such difference will impact the carrying valueof trade and other receivables and impairment loss expenses in the period in which such estimatehas been changed. The carrying amounts of the Group’s trade and other receivables aredisclosed in Notes 7 and 8 respectively.


176

Allowances for inventories

Management reviews the inventory aging listing on a periodic basis. This review involvescomparison of the carrying value of the aged inventory items with the respective net realisablevalue. The purpose is to ascertain whether an allowance is required to be made in the financialstatements for any obsolete and slow-moving items. In addition, the Group conducts physicalcounts of its inventories on a periodic basis in order to determine whether an allowance is requiredto be made. The carrying amounts of the Group’s inventories are disclosed in Note 9.

Fair value of share options granted

The Group is required to assess the fair values of share options granted which involve the inputof certain variables and, accordingly, require significant management estimates and assumptions.Details of the fair value calculation are provided in Note 21 to the financial statements.

Deferred tax assets

Deferred tax assets are recognised to the extent that it is probable that taxable profit will beavailable against which deductible temporary differences can be utilised and that the tax lossescarryforwards will be allowed to offset future taxable income by the tax authorities. Thesesituations will be closely monitored, and adjustments made in future periods, if future estimatesindicate that such adjustments are appropriate.

Provision for income tax

The Group has operations in several countries in the Asia Pacific region and accordingly, isexposed to income taxes in numerous jurisdictions. The Group estimates the potential taxexposure as at year end based on management’s best estimates from past queries andassessments by the respective tax authorities. The Group reviews its position at the end of everyreporting period for any updates from the tax authorities.

Fair value of financial guarantee contracts

The Company is required to assess the fair values of the financial guarantee contracts providedto a bank or financial institution in respect of banking or credit facilities provided to certainsubsidiaries which require significant management estimates and assumptions. Fair values of thefinancial guarantee contracts are estimated based on indicative quotations received from banksin Singapore.

4 FINANCIAL RISKS AND MANAGEMENT

The Group is exposed to financial risks including foreign currency, interest rate, credit and liquidityrisks. Risk management policies are adopted to mitigate these risks in a cost effective manner.

(i) Foreign currency risk

The Group transacts business in various foreign currencies and is therefore exposed toforeign exchange risk. Exposure to exchange fluctuation risks is managed as far as possibleby natural hedges of matching assets and liabilities. Forward contracts are used to partiallyhedge the net exposure to foreign currency movements. Such forward contracts havematurities of less than 12 months and are purchased from financial institutions.


177

The Group has a number of direct investments in the Asia Pacific region, whose net assetsare exposed to currency translation risk. The Group currently does not seek to hedge thisexposure.

(ii) Interest rate risk

The Group’s interest rate exposure is related primarily to the fixed deposits and cashequivalents as disclosed in Note 6 to the financial statements. The Group’s interest-bearingfinancial assets and liabilities are all short-term in nature.

(iii) Credit risk

In its management of credit risk, the Group sets policies to ensure that sales transactions aremade to clients with an appropriate credit history or assessment. The Group has nosignificant concentration of credit risk with any single or group of clients. The Group’s tradereceivables in Greater China, ASEAN and East Asia represented 28%, 44% and 16%respectively (2006: 29%, 47% and 16% respectively) of the total trade receivablesrespectively as at September 30, 2007.

Cash and fixed deposits are held with creditworthy financial institutions.

(iv) Liquidity risk

The Group’s ability to fund its existing and prospective obligations is by maintaining sufficientcash and having in place adequate committed funding lines with banks.

(v) Fair values of financial assets and liabilities

The carrying amounts of cash and cash equivalents, trade and other current receivables andtrade and other payables approximate their respective fair values due to the relativelyshort-term maturity of these financial instruments. The fair values of other classes offinancial assets and liabilities are disclosed in the respective notes to financial statements.

5 HOLDING COMPANY AND RELATED COMPANY TRANSACTIONS

The Company is a subsidiary of Dimension Data International Limited, incorporated in Malta,which is in turn a subsidiary of Dimension Data Holdings plc (“DDH”), a company incorporated inthe United Kingdom. The Company’s ultimate holding company is DDH. Related companies inthese financial statements refer to members of the ultimate holding company’s group ofcompanies.

Some of the transactions and arrangements are between members of the Group and the effect ofthese on the basis determined between the parties is reflected in these financial statements. Theintercompany balances are unsecured, interest-free and repayable on demand unless statedotherwise.


178

Transactions between the Company and its subsidiaries, which are related companies of theCompany, have been eliminated on consolidation and are not disclosed in this note. Details oftransactions between the Group and other related companies are disclosed below.

Significant related company transactions:

The Group2007 2006

US$’000 US$’000

Purchase of goods from related companies 15,473 6,632

Sale of services to related companies (1,416) (433)

Expense recharges by related companies 3,791 2,032

6 CASH AND CASH EQUIVALENTS

The Group The Company2007 2006 2007 2006

US$’000 US$’000 US$’000 US$’000

Cash and bank balances 86,083 85,057 8,525 4,917

Fixed deposits 53,181 56,573 2,260 3,350

Cash equivalents 11,227 9,734 – –

150,491 151,364 10,785 8,267

Cash and bank balances comprise cash held by the Group and short-term bank deposits withmaturity of three months or less. The carrying amounts of these assets approximate their fairvalues.

Fixed deposits bear interest at an average rate of 4.51% (2006: 4.57%) per annum and for atenure of approximately 71 days (2006: 107 days).

As at 30 September 2007, the Group had cash and bank balances denominated in RMBamounting to US$3,489,000 (2006: US$1,940,000) which were deposited with banks in thePeople’s Republic of China. The RMB is not freely convertible into foreign currencies. Under thePeople’s Republic of China Foreign Exchange Control Regulations and Administration ofSettlement, Sales and Payment of Foreign Exchange Regulations, the Group is permitted toexchange RMB for foreign currencies through banks that are authorised to conduct foreignexchange business.


179

The Group and Company’s cash and cash equivalents that are not denominated in the functionalcurrencies of the respective entities are as follow:


US$’000 US$’000 US$’000 US$’000

Hongkong dollars 1,613 2,256 – –

Indonesian rupiah 930 350 – –

Malaysian ringgit 450 261 – –

Singapore dollars 663 1,133 298 669

United States dollars 10,594 15,380 – –

7 TRADE RECEIVABLESThe Group The Company

2007 2006 2007 2006US$’000 US$’000 US$’000 US$’000

Outside parties 128,929 105,010 – –

Advance billings receivables 13,816 15,808 – –

Subsidiaries – – 52,516 75,300

142,745 120,818 52,516 75,300

Less: Allowance for impairment in tradereceivables

– Outside parties (8,251) (8,673) – –

– Subsidiaries – – (6,950) (2,155)

Net 134,494 112,145 45,566 73,145

The Group’s credit period for sale of goods ranges from 30 to 45 days, with longer credit termsgiven to longer projects (2006: 30 to 45 days). No interest is charged on trade receivables fromdate of invoice.

The Group and Company’s trade receivables that are not denominated in the functionalcurrencies of the respective entities are as follow:


US$’000 US$’000 US$’000 US$’000

Australian dollars – 64 – –

Euro – – 79 71

Hongkong dollars 3,580 3,312 – –


Malaysian ringgit – 207 – –

Philippines peso – – 95 85

Singapore dollars 138 99 1,012 208



180

8 OTHER RECEIVABLES AND PREPAYMENTS


US$’000 US$’000 US$’000 US$’000

Amount due from ultimate holding company(Note 5) 17 22 13 13

Amount due from related companies (Note 5) 90 49 2 3

Amount due from a subsidiary (current portion)– non-trade (Notes 5 and 11) – – 2,380 1,190

Prepaid maintenance costs 7,886 10,471 – –

Deposits 6,075 6,072 30 95

Tax recoverable 5,773 4,126 – –

Other prepayments 7,533 4,879 357 485

Other receivables 5,044 4,227 121 139

Rebate receivable from a supplier 3,400 – – –

35,818 29,846 2,903 1,925

The Group and Company’s other receivables and prepayments that are not denominated in thefunctional currencies of the respective entities are as follow:


US$’000 US$’000 US$’000 US$’000

Hongkong dollars 330 212 – –

Indonesian rupiah 631 1,781 – –

Japanese yen – 50 – –

Malaysian ringgit 83 81 – –

Singapore dollars 200 703 153 316

Thai baht 52 48 – –


9 INVENTORIES


US$’000 US$’000 US$’000 US$’000

Trading goods, net realisable value 10,163 9,524 – –


181

10 INVESTMENT IN ASSOCIATES


US$’000 US$’000 US$’000 US$’000

Unquoted equity shares, at cost 8 8 – –

Impairment loss (8) (8) – –

– – – –

The associates are:

Name of associate Principal activities

Country ofincorporation/

Place of businessGroup’s effective

interest2007 2006

% %

Aliran Info Sdn Bhd(1) (2) Inactive Malaysia 30 30

Transys (M) Sdn Bhd(1) Liquidated during the year Malaysia – 49

(1) Not required to be audited in the country of incorporation.

(2) The shares are held by Datacraft (Malaysia) Sdn Bhd.

The results of the associates are not equity accounted for by the Group because the effect on theconsolidated financial statements is immaterial.

11 INVESTMENT IN SUBSIDIARIESThe Company

2007 2006

US$’000 US$’000

Unquoted equity shares, at cost 118,008 132,968

Deemed investment arising from share options granted to subsidiaries’employees 3,228 2,605

Deemed investment arising from financial guarantees provided to thesubsidiaries 1,157 658

Deemed investment arising from interest-free loan granted to a subsidiary(Note 13) 5,110 5,512

Pre-acquisition dividend from unquoted equity investment in a subsidiary (77) (77)

127,426 141,666

Impairment loss (49,716) (75,387)

77,710 66,279

Amount due from subsidiaries(1) 94,442 87,262


30,017 33,323

Net investment in subsidiaries 107,727 99,602

(1) The amount due from subsidiaries is deemed as part of net investments in the subsidiaries, as there is no contractualobligation for the subsidiaries to repay except upon liquidation.


182

The Company2007 2006

US$’000 US$’000

Balance at beginning of financial year 75,387 85,561

Utilised (17,398) (10,174)

Reversal to the profit and loss statement (7,871) –

Deemed investment (402) –

Balance at end of financial year 49,716 75,387

During the current financial year, the cost of investment of US$17,398,000 (2006: US$2,012,000)was written off against the impairment allowance as the result of winding up of a subsidiary. Thereversal of impairment allowance of US$7,871,000 was due to management’s view that theoperations of a subsidiary in China have demonstrated a consistent profitable track record for twoyears.

In addition, in 2006, the Company reviewed the net investment in a subsidiary operating inMalaysia and wrote off the cost of investment of US$8,162,000 against the impairment allowanceas the business that was impaired had been discontinued.


US$’000 US$’000

Balance at beginning of financial year 53,939 53,742

Exchange rate realignment 178 197

Charge to profit and loss statement 10,308 –

Balance at end of financial year 64,425 53,939

During the current financial year, impairment allowance for amounts due from subsidiaries ofUS$10,308,000 was set up due to the continued losses incurred by these subsidiaries.

The subsidiaries are:

Name of subsidiaryPrincipalactivities


Place ofbusiness

Issued andpaid-up capital

Cost ofinvestments

Group’seffective equity

interest

2007 2006 2007 2006

US$’000 US$’000 % %

Beijing DatacraftDevelopmentNetwork Ltd(2) (7)

[Shares held byDatacraft China/Hong Kong Limited]

Liquidated duringthe year

The People’sRepublic ofChina

RegisteredcapitalUS$150,000

– – – 75

Communication Powerand Design PteLtd(1)

Investmentholding

Singapore OrdinaryUS$2

59 59 100 100


183



Place ofbusiness


Cost ofinvestments


interest

2007 2006 2007 2006

US$’000 US$’000 % %

Datacraft AdvancedNetwork ServicesSdn Bhd(2)

Provision ofsoftwareconsultancyservices anddesigning,development,marketing andservicing of datacommunicationsystems

Malaysia OrdinaryRM1,750,000

– – 100 100

Datacraft AsiaInvestments B.V.(4)

Investmentholding

Netherlands OrdinaryEuro20,000

8,070 8,070 100 100

Datacraft Asia TrustPte Ltd(1)

Trustees toemployees of theGroup in theiracquisition orproposedacquisition of fully-paid shares ofDatacraft Asia Ltdpursuant to theDatacraft AsiaShare OptionSchemes

Singapore OrdinaryS$2

3 3 100 100

Datacraft China/HongKong Limited(2)

Designing,development,marketing andservicing of datacommunicationsystems

Hong Kong(5) OrdinaryHK$62.41 million

8,070 8,070 100 100

Datacraft Philippines,Inc.(2)

As above Philippines OrdinaryPeso6.24 million

2,219 2,219 100 100

Datacraft CompanyLtd(4)

Sale and servicingof datacommunicationsystems

Malaysia OrdinaryUS$10,000

10 10 100 100

Datacraft Holdings(NZ) Limited(2)

Investmentholding

New Zealand OrdinaryNZ$1.6 million

1,123 1,123 100 100

Datacraft Holdings(Thailand) Ltd(2) (6)

As above Thailand OrdinaryBaht111,750PreferenceBaht38,250

8 8 49(6) 49(6)

Datacraft (Hong Kong)Limited(2)

Inactive Hong Kong OrdinaryHK$3.6 million

9,932 9,932 100 100


184



Place ofbusiness


Cost ofinvestments


interest

2007 2006 2007 2006

US$’000 US$’000 % %

Datacraft IndiaLimited(2)


India OrdinaryIndian Rupee68.61 million

25,293 25,293 100 100

Datacraft InformationTechnology (Beijing)Ltd(2)

Sale of networkingequipment,software servicesand systemintegration

The People’sRepublic ofChina

OrdinaryUS$2,200,000(2006:US$200,000)

2,200 200 100 100

Datacraft Japan Inc.(2)

[Shares held byDatacraft Asia Ltdand Datacraft AsiaInvestments B.V.]


Japan OrdinaryYen320 million

31 – 93 89.7

Datacraft Korea Inc.(2) Sale and servicingof datacommunicationsystems

Korea OrdinaryWon10.68 billion

42,953 42,953 100 100

Datacraft (Malaysia)Sdn Bhd(2)


Malaysia OrdinaryRM2 million

734 734 100 100

Datacraft Networks(China) Inc.(2)


Designing,marketing, sellingand servicingcommunicationproducts andsystems

Republic ofMauritius(5)

OrdinaryUS$2

– – 100 100

Datacraft (NZ)Limited(2) [Sharesheld by DatacraftHoldings (NZ)Limited]


New Zealand OrdinaryNZ$851,000

– – 100 100

Datacraft (Singapore)Pte Ltd(1)

As above Singapore OrdinaryS$300,000

616 616 100 100

Datacraft TaiwanLimited(2)

As above Taiwan OrdinaryNT$50 million

344 344 100 100


185



Place ofbusiness


Cost ofinvestments


interest

2007 2006 2007 2006

US$’000 US$’000 % %

Datacraft (Thailand)Limited(2)

[Preference sharesheld by DatacraftHoldings (Thailand)Ltd]

As above Thailand OrdinaryBaht19.6 million(2006: Baht4.41million)PreferenceBaht20.4 million(2006: Baht4.59million)

1,004 597 74 74

Datacraft VietnamLtd(2) [Shares heldby CommunicationPower and DesignPte Ltd]

Provision ofinformationtechnologyservices,computer systemand softwaredesignconsultancyservices

The SocialistRepublic ofVietnam

OrdinaryUS$300,000

– – 100 100

DFI ConsultingPhilippines Inc(2)

[Shares held byDatacraft AdvancedNetwork ServicesSdn Bhd]

Inactive Philippines OrdinaryPeso 8 million

– – 100 100

DFI Consulting(Thailand) Co.,Ltd(3) [Ordinaryshares held byDatacraft AdvancedNetwork ServicesSdn BhdPreference sharesheld by DatacraftHoldings (Thailand)Ltd]

As above Thailand OrdinaryBaht12,250PreferenceBaht12,750

– – 74 74

iSquare AsiaLimited(2) (7)

In the process ofLiquidation

Hong Kong OrdinaryHK$9,000

– 17,398 – 100

JQ NetworkPte Ltd(1)

Sale of datacommunicationsystems

Singapore OrdinaryS$2

– – 100 100

Multisoft IT SolutionsPte Ltd (1)

[Shares held byDatacraft(Singapore) Pte Ltd]

Sale of computerhardware,software andlicences and theprovision ofancillary services

Singapore OrdinaryS$300,000

– – 100 100

PlaNET Solutions(International) Ltd(4)

Computer systemsconsultants

Malaysia OrdinaryS$18,300

6 6 60 60


186



Place ofbusiness


Cost ofinvestments


interest

2007 2006 2007 2006

US$’000 US$’000 % %

PlaNET Solutions (M)Sdn Bhd(2)

[Shares held byPlaNET TechnologySolutions Pte Ltd]

Sale of datacommunicationsystems

Malaysia OrdinaryRM2

– – 60 60

PlaNET TechnologySolutions Pte Ltd(1)

As above Singapore OrdinaryS$2,300,000

7,328 7,328 60 60

P.T. DatacraftIndonesia(2)

[Shares jointly heldby Datacraft AsiaLtd andCommunicationPower & Design PteLtd]


Indonesia Ordinary Rp5,820,000,000

7,772 7,772 100 100

TP Network Consulting(Shanghai) Co Ltd(2)

Inactive The People’sRepublic ofChina

OrdinaryUS$200,000

200 200 100 100

Training Partners Co.,Ltd(2)

[Shares jointly heldby Datacraft AsiaLtd and DatacraftHoldings (Thailand)Ltd]

Provision oftraining,consultancy,systemdevelopmentand projectmanagement incomputers,computersoftware andcommunications

Thailand OrdinaryBaht300,000

– – 74 74

Training Partners PteLtd(1)

Provision oftraining

Singapore OrdinaryS$50,000

33 33 100 100

UCS CommunicationsLimited

(2) (7)


Liquidated duringthe year

Hong Kong(5) OrdinaryHK$10,000

– – – 100

118,008 132,968

(1) Audited by Deloitte & Touche, Singapore.

(2) Audited by overseas practices of Deloitte Touche Tohmatsu.

(3) Audited by S.C.Ex-Cl Accounting Co., Ltd in Thailand.

(4) Not required to be audited in the country of incorporation.

(5) These subsidiaries carry on business in the People’s Republic of China.

(6) Datacraft Holdings (Thailand) Ltd is treated as a subsidiary as the Company controls the composition of the boardof directors and its financing and operating decisions.

(7) During the financial year, the subsidiary commenced winding up procedures and the liquidation of the subsidiary doesnot have a significant financial effect on the consolidated financial statements.


187

12 INVESTMENT IN JOINT VENTUREThe Company

US$’000

Cost of equity investment in joint venture 408

Name of joint venture Principal activities


Place ofbusiness

Group’seffective interest

%

Sumisho Joho Datacraft Corporation Provision of networkintegration servicesand solutions

Japan 50

In the current financial year, the Group acquired a 50% equity shareholding with equivalent votingpower, in Sumisho Joho Datacraft Corporation, a joint venture established in Japan.

The following amounts based on unaudited management accounts are included in the Group’sfinancial statements as a result of the proportionate consolidation of Sumisho Joho DatacraftCorporation:

US$’000

Current assets 425

Non-current assets 25

Current liabilities (71)

Income 18

Expenses (47)

13 AMOUNT DUE FROM SUBSIDIARY


US$’000 US$’000

Nominal value 18,866 23,880

Less: Future finance charges (2,453) (3,685)

16,413 20,195

Less: Current portion (Note 8) (2,380) (1,190)

Non-current portion 14,033 19,005


9,966 3,170

Future finance charge is represented by:

Excess of nominal value over the fair value of intercompany loan at loaninception (Note 11) 5,110 5,512

Notional interest income deemed earned using amortised cost method (2,657) (1,827)

Total 2,453 3,685


188

Included in amount due from subsidiary is a loan receivable of US$15,216,000 (2006:US$20,230,000). The loan agreement between the Company and the subsidiary specifies that theamount is interest-free, unsecured and repayable in equal semi-annual instalments ofUS$1,190,000 through September 15, 2014. Directors are of the view that US$2,380,000 will bereceived within 12 months. The carrying amounts of non-current portion approximate their fairvalue based on the expected timing of realisation of the loan receivable discounted to the presentvalue at market interest rate.

14 PLANT AND EQUIPMENT

Motorvehicles

Maintenance,workshop anddemonstration

equipment

Furniture,fittings andequipment Total

US$’000 US$’000 US$’000 US$’000

The Group

Cost:

At October 1, 2005 465 56,760 14,822 72,047

Exchange rate realignment 3 862 320 1,185

Additions – 5,949 274 6,223

Disposals (31) (3,151) (3,509) (6,691)

At September 30, 2006 437 60,420 11,907 72,764

Exchange rate realignment 5 2,162 476 2,643

Additions 236 7,828 584 8,648

Transfer to inventory – (52) – (52)

Disposals (129) (2,059) (241) (2,429)

At September 30, 2007 549 68,299 12,726 81,574

Accumulated depreciation:

At October 1, 2005 333 46,168 10,835 57,336

Exchange rate realignment 2 751 272 1,025

Charge 36 7,048 831 7,915

Disposals (25) (3,093) (3,328) (6,446)

At September 30, 2006 346 50,874 8,610 59,830

Exchange rate realignment 4 1,644 324 1,972

Charge 53 6,694 1,025 7,772

Transfer to inventory – (9) – (9)

Disposals (65) (2,039) (224) (2,328)

At September 30, 2007 338 57,164 9,735 67,237

Net carrying amount:

At September 30, 2007 211 11,135 2,991 14,337

At September 30, 2006 91 9,546 3,297 12,934


189

Motorvehicles

Maintenance,workshop anddemonstration

equipment

Furniture,fittings andequipment Total

US$’000 US$’000 US$’000 US$’000

The Company

Cost:

At October 1, 2005 129 299 12,842 13,270

Additions – – 1,468 1,468

Disposals – – (638) (638)

At September 30, 2006 129 299 13,672 14,100

Additions 234 24 1,042 1,300

Disposals (129) – (7) (136)

Reclassification – 13,413 (13,413) –

At September 30, 2007 234 13,736 1,294 15,264

Accumulated depreciation:

At October 1, 2005 50 267 10,938 11,255

Charge 15 7 1,013 1,035

Disposals – – (506) (506)

At September 30, 2006 65 274 11,445 11,784

Charge 42 14 1,136 1,192

Disposals (69) – (7) (76)

Reclassification – 11,869 (11,869) –

At September 30, 2007 38 12,157 705 12,900

Net carrying amount:

At September 30, 2007 196 1,579 589 2,364

At September 30, 2006 64 25 2,227 2,316

In the prior financial year, the carrying amount of the Group’s motor vehicles and maintenance,workshop and demonstration equipment amounting to US$3,000 and US$39,000 respectivelywere under finance lease agreements (Note 20).

15 GOODWILL

The Group2007 2006

US$’000 US$’000

Cost 13,389 13,389

Accumulated impairment (12,741) (12,741)

648 648


190

The goodwill of US$648,000 arose on the acquisition of the business from Advanced TechnologyPartners Limited (“ATP”) in October 2004. For the purpose of impairment testing of this goodwill,the recoverable amount of the relevant cash generating unit is determined based on value in usecomputations. The key assumptions in the value in use calculations are the cash flow forecasts,the growth rate and the discount rate. The cash flows are prepared based on next year’s budgetand the growth rate to extrapolate the cash flow forecasts beyond the budget prepared is 10%(2006: 10%). The rate used to discount the forecast cash flows from the ATP business is 11.75%(2006: 10.5%).

The goodwill of US$12,741,000 arose on the Group’s acquisition of a 100% interest in DasanElectronics Co., Ltd (“Dasan”), which was merged with Datacraft Korea Inc. during the financialperiod from July 1, 2001 to September 30, 2002. After the merger, Datacraft Korea Inc. remainsas the surviving company and Dasan was dissolved. As at September 30, 2004, the Groupreviewed the carrying amount of the goodwill and determined that the goodwill was impaired asthere was uncertainty as to whether the Dasan business would return to profitability in the nearfuture.

16 AVAILABLE-FOR-SALE INVESTMENTS


US$’000 US$’000 US$’000 US$’000

At fair value:

Life insurance policies 1,071 1,046 – –

Quoted equity shares 145 111 – –

Total 1,216 1,157 – –

The life insurance policies were purchased by one of the subsidiaries for certain of its existingemployees and ex-employees with the beneficiary being the subsidiary. The directors are of theopinion that the carrying amount of the life insurance policies approximate their fair value.

The fair value of investments in quoted equity shares is based on the quoted closing market priceson the last market day of the financial year.

17 DEFERRED INCOME TAX


US$’000 US$’000 US$’000 US$’000

Deferred tax assets 1,533 2,592 – –

Deferred tax liabilities 634 795 268 346


191

The movement for the financial year in deferred tax assets is as follows:


US$’000 US$’000 US$’000 US$’000

At beginning of financial year 2,592 2,368 – –

Exchange rate realignment 119 138 – –

(Charge) Credit to profit and loss statement (1,178) 86 – –

At end of financial year 1,533 2,592 – –

The movement for the financial year in deferred tax liabilities is as follows:


US$’000 US$’000 US$’000 US$’000

At beginning of financial year 795 1,163 346 450

Exchange rate realignment 34 (13) – –

Credit to profit and loss statement (195) (355) (78) (104)

At end of financial year 634 795 268 346

The following are the major components of deferred tax assets and liabilities recognised by theCompany and the Group and movements thereon during the financial year:

Deferred tax assets

Taxlosses

Acceleratedaccounting

depreciation Provisions

Unrealisedforeign

exchangedifferences

Othertemporary

differences TotalUS$’000 US$’000 US$’000 US$’000 US$’000 US$’000

The Group

At beginning of financialyear 945 438 2,030 217 (1,038) 2,592

Exchange raterealignment 33 5 31 25 25 119

(Charge) Credit to profitand loss statement (719) (240) (1,780) (14) 1,575 (1,178)

At end of financial year 259 203 281 228 562 1,533


192

Deferred tax liabilitiesAccelerated

taxdepreciation

Othertemporarydifferences Total

US$’000 US$’000 US$’000

The Group

At beginning of financial year 513 282 795

Exchange rate realignment 39 (5) 34

Charge (Credit) to profit and loss statement 144 (339) (195)

At end of financial year 696 (62) 634

The Company

At beginning of financial year 186 160 346

Charge (Credit) to profit and loss statement 14 (92) (78)

At end of financial year 200 68 268

Deferred tax assets are recognised to the extent that realisation of the related tax benefits throughfuture taxable profits is probable.

As at September 30, 2007, the subsidiaries in Korea, Malaysia and Japan had estimatedunutilised income tax losses of approximately US$17,466,000 (2006: US$33,244,000) and otherunutilised tax benefits amounting to US$3,861,000 (2006: US$2,411,000) as described below:

The Group2007 2006

US$’000 US$’000

Amount at beginning of year 33,244 45,887

Adjustments for prior year (13,891) (3,385)

Tax losses arising in current year 4,873 1,603

Amount recognised in current year – (3,400)

Amount utilised in current year (6,760) (7,461)

Amount at end of year 17,466 33,244

Deferred tax benefit on above unrecorded 5,983 8,052

The above unutilised income tax losses and other unutilised tax benefits are available for set-offagainst future profits subject to the agreement of relevant tax authorities. The potential taxbenefits arising from the above were not recognised in the financial statements due to theuncertainty of future taxable benefits.

At the balance sheet date, the aggregate amount of temporary differences associated withundistributed earnings of subsidiaries for which deferred tax liabilities have not been recognisedwas US$8,000,000 (2006: US$7,094,000). No liability has been recognised in respect of thesedifferences because the Group is in a position to control the timing of declaration of dividend fromthe subsidiaries and it is probable that such differences will not reverse in the foreseeable future.


193

18 TRADE AND OTHER PAYABLESThe Group The Company

2007 2006 2007 2006US$’000 US$’000 US$’000 US$’000

Trade payables 68,412 62,011 – –

Unearned revenue 14,428 16,382 – –

Accruals 40,025 38,471 6,745 7,464

Due to subsidiaries – trade (Notes 5 and 11) – – 14,346 23,674

Due to related companies – trade (Note 5) 11,064 1,916 2,014 990

133,929 118,780 23,105 32,128

The Group’s credit period on purchases of goods ranges from 30 to 60 days (2006: 30 to 60 days).

The Group and Company’s trade and other payables that are not denominated in the functionalcurrencies of the respective entities are as follow:


US$’000 US$’000 US$’000 US$’000

China renminbi – 247 – –

Hongkong dollars 1,887 1,468 88 –

New Zealand dollars – – 86 –


Philippines peso 651 572 – –

Singapore dollars 645 1,355 365 635


19 PROVISIONSThe Group The Company

2007 2006 2007 2006US$’000 US$’000 US$’000 US$’000

Employees’ benefits 1,521 1,063 213 122

Movements in employees’ benefits provision:


US$’000 US$’000 US$’000 US$’000

Balance at beginning of financial year 1,063 1,193 122 122

Exchange rate realignment 71 – – –

Charge to profit and loss statement 444 128 91 –

Utilised (57) (258) – –

Balance at end of financial year 1,521 1,063 213 122

The above provision relates to short term employee benefits in the form of compensated absence.


194

20 FINANCE LEASES

The GroupMinimum

lease paymentPresent value of

minimum lease payment2007 2006 2007 2006

US$’000 US$’000 US$’000 US$’000

Amounts payable under finance leases:

Within one year – 31 – 26

In the second to fifth year inclusive – 24 – 19

– 55 – 45

Less: Future finance charges – (10) NA NA

Present value of lease obligations – 45 – 45

Less: Amount due for settlement within twelvemonths – (26)

Amount due for settlement after twelve months – 19

In the last financial year, the average lease of the finance lease was 3 years and the rate ofinterest for finance leases was about 17% per annum.

21 SHARE-BASED PAYMENTS

Share option schemes

(a) The Company has two share option schemes. The Previous Scheme was adopted in 1996.During the financial year ended September 30, 2003, the Previous Scheme was terminatedand replaced by the Scheme 2003. The termination of the Previous Scheme does not affectthe rights of outstanding options (“Options”) granted under the Previous Scheme. SuchOptions continue to be exercisable in accordance with the rules of the Previous Scheme.However, upon the termination of the Previous Scheme on February 27, 2003, no furtherOptions were granted under the Previous Scheme.

(b) The main terms of the Previous Scheme and Scheme 2003 are as follow:

(i) The Options may be exercised in respect of 1,000 Shares or a multiple thereof, on thepayment of the applicable exercise price.

(ii) The Options (other than Options granted at a discount) may be exercised in thefollowing manner:

(1) 25% of the Option amount at any time after the first anniversary of the date of thegrant;

(2) a further 25% of the Option amount at any time after the second anniversary ofthe date of the grant;

(3) a further 25% of the Option amount at any time after the third anniversary of thedate of the grant; and


195

(4) the final 25% of the Option amount at any time after the fourth anniversary of thedate of the grant.

(iii) Options granted at a discount may be exercised in the following manner:

(1) 50% of the Option amount at any time after the second anniversary of the date ofthe grant;

(2) a further 25% of the Option amount at any time after the third anniversary of thedate of the grant; and

(3) the final 25% of the Option amount at any time after the fourth anniversary of thedate of the grant.

(iv) The option period for Options granted prior to January 20, 2006 is 10 years, except forthose options granted to non-executive directors of the Company, subsidiaries andassociated companies which carry a 5-year option period.

(v) The Options, to the extent unexercised, shall unless the committee (“Committee”)administering the Previous Scheme or Scheme 2003 (as the case may be) otherwisedetermines in accordance with the rules of the respective schemes lapse upon theemployee ceasing to be employed by the Company or its subsidiaries or controlledassociated companies.

In addition under the Scheme 2003,

(i) the Committee may grant options at any time except that no options shall be grantedduring the period commencing the first day after the end of each quarter of the financialyear, half year or financial year, as the case may be, and ending on the date of theannouncement of the relevant results;

(ii) the total number of options granted to non-executive directors and to non-executivedirectors who are also members of the Audit Committee, shall not exceed 3% and 2%of the shares available under Scheme 2003, respectively; and

(iii) the aggregate number of shares (“Shares”) of the Company that may be issued underthe Scheme 2003, when added to the number of Shares issued and issuable in respectof (a) all Options granted under the Scheme 2003 and (b) all awards (“Awards”)granted under the Datacraft Asia Performance Share Plan (“Performance Share Plan”)shall not exceed 15% of the total number of issued Shares excluding treasury shareson the day preceding the relevant date of grant.

(c) On January 20, 2006, the shareholders of the Company (“Shareholders”) approved certainmodifications to the Scheme 2003 and modifications to the terms and conditions of Optionsgranted under the Previous Scheme.

For the Previous Scheme, the modifications as approved by Shareholders allowed forflexibility of settlement in respect of the exercise of outstanding Options granted under thePrevious Scheme. In addition to allotting and issuing new Shares to participants upon theexercise of Options, the Company has the discretion to also deliver treasury shares(“Treasury Shares”) and/or pay the equivalent value in cash to the participant in lieu ofissuing or delivering Shares to the participants.


196

The main modifications to the Scheme 2003 are as follow:

(i) The maximum option period is shortened from 10 years to 7 years for Options grantedto the participants after January 20, 2006. Existing options granted with a 10-yearoption period prior to January 20, 2006 will continue to have the same 10-year optionperiod.

(ii) Performance targets were introduced as vesting conditions in addition to serviceconditions, that is, so long as a participant completes a specified period of service, therelevant Option will vest and become exercisable by such participant (“ServiceConditions”). In respect of Options granted after January 20, 2006, such Options willonly vest and become exercisable when the participant satisfies the Service Conditionsand achieves performance targets which are currently based on (a) profit before tax ofthe Group with respect to the holder of the Options who are employees of the Companyand (b) profit before tax of the relevant subsidiary or controlled associated company inthe case of any other employees. Such performance targets do not apply tonon-executive directors. Options under the Scheme 2003 that were granted beforeJanuary 20, 2006 continue to have only Service Conditions.

(iii) In addition to allotting and issuing new Shares to participants upon the exercise ofOptions under the Scheme 2003, the Company has the flexibility to also determinewhether to deliver Treasury Shares and/or pay the equivalent value in cash to theparticipant in lieu of issuing or delivering Shares to the participants.

(iv) The expected value of the aggregate of all Options granted under the Scheme 2003,all Awards granted under Performance Share Plan and all options and awards grantedunder any future share-based incentive schemes of the Company (“Share-basedIncentives”) granted to an executive director or executive in any financial year shall notexceed that executive director’s or executive’s basic annual salary determined by theCompany in accordance with the rules of the Scheme 2003 as at the date fallingimmediately prior to the date of grant. The aggregate expected value of all Share-based Incentives, valued at “fair value” as defined under FRS 102 shall not exceed10% of the aggregate annual basic salary costs of the Group in each financial year.

The subscription price for Shares upon the exercise of an Option was equal to the market priceof the Shares based on the average of the last dealt prices for a Share, as determined byreference to the daily official list or other publication by the Singapore Exchange SecuritiesTrading Limited (“SGX-ST”) for the last three consecutive market days on which there weretransactions done for the Shares on the SGX-ST immediately preceding the date of grant of thatoption (“Market Price”). The Committee may at its discretion fix the subscription price at a discountnot exceeding 20% to the above price.


197

Details of Options outstanding during the year are as follow:

Previous Scheme

The Group and Company2007 2006

Number ofOptions

Weightedaverage exercise

priceNumber of

Options


priceUS$ US$

Outstanding at the beginning of year 13,097,000 1.993 14,991,000 1.941

Forfeited during the year (837,000) 2.565 (1,105,000) 2.193

Exercised during the year (1,606,000) 0.725 (789,000) 0.725

Outstanding at the end of year 10,654,000 2.139 13,097,000 1.993

Exercisable at the end of year 10,654,000 2.139 11,215,500 2.206

The weighted average share price at the date of exercise for Options exercised during the yearwas US$1.174 (2006: US$1.028). The Options outstanding at the end of the year have a weightedaverage remaining contractual life of 4.2 years (2006: 5.4 years).

Scheme 2003

The Group and Company2007 2006

Number ofOptions


priceNumber of

Options


priceUS$ US$

Outstanding at the beginning of year 15,736,000 1.048 11,884,000 0.982

Granted during the year 7,853,000 1.080 6,565,000 1.140

Forfeited during the year (2,367,000) 1.087 (2,258,000) 1.012

Exercised during the year (1,521,000) 0.963 (455,000) 0.835

Outstanding at the end of year 19,701,000 1.062 15,736,000 1.048

Exercisable at the end of year 5,244,750 1.071 3,348,250 1.060

The weighted average share price at the date of exercise for Options exercised during the yearwas US$1.197 (2006: US$1.050). The Options outstanding at the end of the year have a weightedaverage remaining contractual life of 6.3 years (2006: 7.2 years).

For the financial year ended September 30, 2007, Options were granted on March 15, 2007. Theestimated fair values of the Options granted on March 15, 2007 were between US$0.24 andUS$0.35. For the financial year ended September 30, 2006, Options were granted onFebruary 20, 2006. The estimated fair values of the Options granted on February 20, 2006 werebetween US$0.25 and US$0.42.


198

These fair values were calculated using the Binomial option pricing model. The inputs into themodel were as follows:

2007 2006

Share price at date of grant US$1.10 US$1.11

Exercise price US$1.08 US$1.14

Expected volatility 38% 43%

Contractual life 7 years 7 years

Risk free rates 4.51% to 4.68% 4.60% to 4.71%

Expected dividend yield 3% 1.2%

Expected volatility was determined by calculating the historical volatility of the Company’s shareprice over the previous 3 years.

It was assumed that employees who voluntarily resign would have exercised their options rightbefore they resign if the share price at the point of exercise exceeds the exercise price. It wasfurther assumed that employees will only exercise their options if the share price at that momentexceeds the exercise price by 15% (2006: 15%).

The Group recognised total expenses of US$1,352,000 (2006: US$1,537,000) related toequity-settled share-based payment transactions during the year.

Performance Share Plan

On January 20, 2006, the Shareholders approved the Performance Share Plan under whichawards of fully paid-up shares will be granted, free of payment, to selected eligible participants,when and after pre-determined performance targets and/or service conditions are satisfied. TheAwards may be settled by the issue of new Shares and/or the delivery of Treasury shares and/orpayment of the equivalent value in cash to participants in lieu of issuing or delivering Shares tothe participants or combinations thereof at the sole discretion of the Company. Since the adoption,no Awards have been granted under the Performance Share Plan.

22 ISSUED CAPITAL

The Group and Company

2007 2006 2007 2006

Number of ordinary shares US$’000 US$’000

Issued and fully paid:

At beginning of financial year 468,012,683 467,339,683 139,999 14,080

Exercise of share options via issue ofnew shares – 673,000 – 216

468,012,683 468,012,683 139,999 14,296

Capital reduction – – – (80,445)

Transfer of share premium account toshare capital account – – – 206,148

At end of financial year 468,012,683 468,012,683 139,999 139,999


199

As a result of the Companies (Amendment) Act 2005 which came into effect on January 30, 2006,the concept of authorised share capital and par value has been abolished. An amount ofUS$206,148,000 in the share premium account was transferred to the Company’s share capitalaccount on the effective date.

In 2006, the Company undertook a capital reduction exercise pursuant to Section 78A read withSection 78C of the Companies Act to cancel from the Company’s issued and paid-up capital anamount of US$80,445,000 which eliminated the deficit in the Company’s accumulated profitaccount as at March 31, 2006.

In 2006, 414,000 and 259,000 new ordinary shares were issued pursuant to the exercise ofOptions granted under the Previous Scheme and the Scheme 2003 (Note 21) respectively.

23 TREASURY SHARES

The Group and Company2007 2006 2007 2006

Number of ordinary shares US$’000 US$’000

At beginning of financial year 16,921,000 – 17,462 –

Repurchased during the year 5,973,000 17,121,000 6,853 17,689

Reissued upon option exercise (569,000) (200,000) (618) (227)

At end of financial year 22,325,000 16,921,000 23,697 17,462

The Companies Act was amended to allow companies to hold Treasury Shares after January 30,2006. Pursuant to a share purchase mandate (“Share Purchase Mandate”) approved byShareholders on January 20, 2006, the Company purchased a total of 5,973,000 (2006:17,121,000) shares through market purchases on the Singapore Exchange Securities TradingLimited during the year. The total amount paid to acquire the shares pursuant to the SharePurchase Mandate was US$6,853,000 (2006: US$17,689,000) and has been deducted fromshareholders’ equity. The repurchased shares are held as “Treasury Shares”. The Companyintends to transfer from time to time such Treasury Shares to satisfy exercise of Options under theShare Option Schemes and/or grant of Awards under the Performance Share Plan. During thefinancial year, 350,000 (2006: 134,000) and 219,000 (2006: 66,000) Treasury Shares weretransferred and delivered upon the exercise of Options granted under the Previous Scheme andthe Scheme 2003, respectively.

24 REVENUEThe Group

2007 2006US$’000 US$’000

Product sales 374,834 310,018

Services 205,995 172,139

580,829 482,157

Revenue of the Group, which excludes sales between group companies, represents sales of datacommunication systems at invoiced value, pro-rated maintenance income, training andinstallation fees received, net of goods and services tax.


200

25 OTHER OPERATING INCOMEThe Group

2007 2006US$’000 US$’000

Insurance settlement(1) – 5,150

Interest income:

Bank deposits 4,079 3,540

Others 64 9

Net foreign exchange (losses) gains (544) 348

Investment income 627 497

4,226 9,544

(1) In 2006, the Company received US$5,150,000 from its insurers as payment for loss from the non-recoverability ofcertain accounts receivables in China which were provided for in full in the previous financial years.

26 FINANCE COSTS

The Group2007 2006

US$’000 US$’000

Interest expense 50 104

27 INCOME TAX

The Group2007 2006

US$’000 US$’000

Current – Singapore 1,031 1,745

– Foreign 10,419 6,823

Deferred (net) 70 (177)

(Over) Under provision in prior financial years (net):

Current (1,561) 885

Deferred 913 (264)

10,872 9,012

Domestic income tax is calculated at 18% (2006: 20%) of the estimated assessable profit for theyear. Taxation for other jurisdictions is calculated at the rates prevailing in the relevantjurisdictions.


201

The total charge for the accounting period can be reconciled to the accounting profit as follows:

The Group2007 2006

US$’000 US$’000

Profit before tax 41,176 35,271

Income tax benefit at statutory rate of 18% (2006: 20%) 7,412 7,054(Non-taxable) Non-allowable items (278) 2,446(Over) Under provision in prior financial years (648) 621Non-taxable income (581) (2,075)Tax on foreign sourced income 2,160 970Income subject to concessionary tax rate (57) (110)Tax benefit on tax loss carryforwards recognised – (680)Tax benefits not recognised 1,528 321Tax benefits utilised previously not recognised (1,418) (1,492)Tax rate differentials between Singapore and foreign countries 2,711 1,960Other items 43 (3)

10,872 9,012

The Company has been granted the Operational Headquarters (“OHQ”) status effective fromOctober 1, 2005 for a renewed period of 5 years subject to the fulfilment of certain terms andconditions by October 1, 2009. The income from the qualifying OHQ activities was taxed at aconcessionary rate of 10%.

28 PROFIT FOR THE YEAR

Profit for the year has been arrived at after charging (crediting):

The Group2007 2006

US$’000 US$’000

Remuneration of directors of the Company (Note A) 2,434 2,367Remuneration of directors of subsidiaries (Note A) 4,031 3,205Costs of defined contribution plans 2,251 2,914Other staff costs (excluding remuneration of directors and costs of defined

contribution plans) 80,835 68,221Audit fees for auditors of the Company 342 315Audit fees for member firms of the Company’s auditors 475 431Fees payable for non-audit services rendered by:

Auditors of the Company 237 129Other auditors 927 1,091

Cost of inventories 355,144 291,463Allowance for inventories 317 422Depreciation of plant and equipment 7,772 7,915Loss on liquidation of subsidiaries 524 –Loss on disposal of plant and equipment 26 208Net foreign exchange losses (gains) 544 (348)

Note

(A) Included in the remuneration of the directors are share-based payments for the options granted to directors of theCompany and subsidiaries amounting to US$250,000 and US$226,000 (2006: US$385,000 and US$173,000)respectively.


202

Compensation of directors and key management personnel

The remuneration of directors and other members of key management during the year was asfollows:

The Group2007 2006

US$’000 US$’000

Short-term benefits 8,628 7,335

Post-employment benefits 88 66

Share-based payments 730 760

Total 9,446 8,161

The remuneration of directors and key management is determined by the remunerationcommittee having regard to the performance of individuals and market trends.

29 DIVIDENDS

On February 11, 2007, a total after-tax dividend of 4.71 US cents per share (total dividendUS$21.25 million) was paid to shareholders. The dividend comprises a final dividend of 3.7 UScents less 20% tax, a special dividend made up of 0.5 US cents less 20% tax and a tax exemptdividend of 1.35 US cents.

In respect of current financial year, the Board of Directors proposed a total tax exempt dividendof 6.3 US cents per share. The dividend comprises a final dividend of 3.4 US cents and a specialdividend of 2.9 US cents. This dividend is subject to approval by shareholders at the AnnualGeneral Meeting and has not been included as a liability in these financial statements.

30 EARNINGS PER ORDINARY SHARE

The calculation of the basic and diluted earnings per share attributable to the ordinary equityholders of the Company is based on the following data:

2007 2006Basic Diluted Basic Diluted

Earnings (US$’000):

Earnings for the purposes of basic earningsper share (profit for the year attributable toequity holders of the Company) 30,316 30,316 26,314 26,314

Number of shares (’000):

Weighted average number of ordinary shares 448,559 448,559 462,897 462,897

Adjustment:

– dilutive potential ordinary shares – 2,987 – 2,429

Weighted average number of ordinary sharesused to compute earnings per share 448,559 451,546 462,897 465,326

Earnings per share (US cents) 6.76 6.71 5.68 5.66


203

31 COMMITMENTS

The Group2007 2006

US$’000 US$’000

(a) Capital expenditure commitments:

Estimated amounts committed for future capital expenditurebut not provided for in the financial statements 35 106

(b) The aggregate value of forward foreign exchange contracts outstanding at end of financial year wasas follows:


US$’000 US$’000 US$’000 US$’000

Equivalent in United States dollars 11,198 12,177 – –

32 OPERATING LEASE ARRANGEMENTS

The Group2007 2006

US$’000 US$’000

Operating rental commitments:

Minimum rental payments under operating leases recognised as anexpense in the year 6,685 7,073

The Group has commitments for non-cancellable operating leases of premises and assets.Leases are negotiated for an average term of 3 years and rentals are fixed for an average of 2years. The minimum rental commitments are as follow:

The Group2007 2006

US$’000 US$’000

Payable within 1 year 6,188 6,211

Payable within 2 to 5 years inclusive 6,756 7,182

12,944 13,393


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33 CONTINGENT ITEMS


US$’000 US$’000 US$’000 US$’000

Unsecured

Guarantees given by the Company to banks inconnection with bank facilities provided tosubsidiaries – – 53,109 52,208

Guarantee given by the Company to a financingcompany in connection with credit facilitiesprovided to a subsidiary – – 37,500 37,000

Guarantees given to banks for tenancy security 137 84 60 57

Performance bond issued by the banks of theCompany in favour of subsidiaries(1) 3,657 2,871 3,657 2,871

Bond given by a subsidiary to Commissioner ofCustoms 502 436 – –

Performance guarantees 10,966 10,627 1,046 1,046

Promissory note given to a bank 66 45 – –

Discounting with recourse – 3,118 – –

(1) A negative pledge of assets of the Company, excluding the investments in Datacraft India Limited and Datacraft (NZ)Limited are held for granting bank facilities.

As at September 30, 2006, one of the Company’s subsidiaries was named as a co-defendant ina legal suit in Japan in respect of a dispute relating to the merger of two companies in Japan.Subsequent to the year end, the Tokyo District Court ruled against the plaintiffs and dismissed thesuit. The plaintiffs have however filed against the decision. The Company has instructed its legalcounsel to defend the cases to the fullest extent possible. The information usually required byFRS 37 Provisions, Contingent Liabilities and Contingent Assets, is not disclosed by the Group onthe grounds that it can be expected to prejudice seriously the outcome of the legal case. Thedirectors of the Company do not expect the aforementioned claims to have a significant financialeffect on the consolidated financial statements.

During the current financial year, the Company and one of its subsidiaries commenced a legal suitin Singapore against the abovementioned plaintiffs arising from the breach of a commercialagreement. The Company has received legal advice that based on the instructions given to thelawyers, the Company and its subsidiary have a reasonable chance of succeeding in the claim.

The directors of the Company do not expect the aforementioned suit to have a significant financialeffect on the consolidated financial statements and believe it would be imprudent to recognise anybenefit until the matter is ruled in favour of the Company.


205

34G

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207

(b) By business segments:

Revenue2007 2006

US$’000 US$’000

Product sales 374,834 310,018

Services 205,995 172,139

Total 580,829 482,157

Notes:

(i) The above segmental information has been compiled in a consistent manner. Revenue is based on the countryin which the assets are located. It would not be materially different if based on the country in which the clientis located. Inter-segment sales were carried out in the normal course of business on terms agreed betweenthe parties.

(ii) Composition of each geographical segment is as follows:ASEAN – Singapore, Malaysia, Thailand, Indonesia, Philippines and VietnamGreater China – The People’s Republic of China, Hong Kong and TaiwanEast Asia – Japan and Korea

(iii) No split of assets and capital expenditure by business segments has been presented as assets are used forboth business segments interchangeably and directors do not consider this information would be meaningful.

35 SUBSEQUENT EVENTS

Subsequent to the balance sheet date:

(i) Dimension Data International Limited transferred its entire direct shareholding of240,633,669 shares in Datacraft Asia Ltd to its ultimate holding company, Dimension DataHoldings plc. This is to streamline the shareholding of Datacraft Asia Ltd within theDimension Data Group. There is no change in the shareholding of Dimension Data Groupin Datacraft Asia Ltd as a result of this transfer.

(ii) The directors had given in-principle approval for Datacraft Asia Ltd to enter into a conditionalagreement to acquire the business of an information technology security consultingcompany based in New Zealand for a cash consideration of NZ$5 million (approximatelyUS$3.8 million). The net tangible assets to be acquired is expected to have a book value ofNZ$45,000 (approximately US$34,000).


208

DATACRAFT ASIA LTD(Registration no: 199301842Z)

Third Quarter Financial Statement And Dividend Announcement for the Period Ended30 June 2008

PART I - INFORMATION REQUIRED FOR ANNOUNCEMENTS OF QUARTERLY (Q1, Q2 & Q3),HALF-YEAR AND FULL YEAR RESULTS

1(a) An income statement (for the group) together with a comparative statement for thecorresponding period of the immediately preceding financial year.

Group Group

Q32008

US$’000

Q32007

US$’000Change

%

9 monthsto

30/06/08US$’000

9 monthsto

30/06/07US$’000

Change%

Revenue 187,251 147,336 27.1 541,038 419,849 28.9

Cost of sales (152,901) (119,664) 27.8 (441,067) (340,561) 29.5

Gross profit 34,350 27,672 24.1 99,971 79,288 26.1

Gross margin % 18.3% 18.8% 18.5% 18.9%

Add: Other operatingincome (Note 1(a)(i)) 1,192 569 109.5 4,469 3,154 41.7

Less: Operating expenses

Distribution and sales (15,015) (11,594) 29.5 (43,134) (33,617) 28.3

Administrative (7,409) (6,181) 19.9 (21,416) (18,612) 15.1

Share options expense (448) (330) 35.8 (1,298) (1,040) 24.8

Finance costs – (8) (100.0) (1) (50) (98.0)

Profit before tax (Note1(a)(ii)) 12,670 10,128 25.1 38,591 29,123 32.5

Profit before tax % 6.8% 6.9% 7.1% 6.9%

Income tax expense (3,654) (2,795) 30.7 (10,649) (7,957) 33.8

Effective tax rate % 28.8% 27.6% 27.6% 27.3%

Profit after tax 9,016 7,333 23.0 27,942 21,166 32.0

Profit after tax margin % 4.8% 5.0% 5.2% 5.0%

Attributable to:

Shareholders of theCompany 9,022 7,325 23.2 27,940 21,172 32.0

Minority interests (6) 8 (175.0) 2 (6) (133.3)

9,016 7,333 23.0 27,942 21,166 32.0

APPENDIX 6: UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS OF THECOMPANY FOR Q3 2008

209

1(a)(i) Other operating income comprises of:

Group Group

Q32008

US$’000

Q32007

US$’000

9 months to30/06/08US$’000

9 months to30/06/07US$’000

Interest income 820 978 2,811 3,100

Investment income 201 156 651 465

Foreign exchange gain/(loss) 171 (565) 1,007 (411)

1,192 569 4,469 3,154

1(a)(ii) Profit before tax includes:

Group Group

Q32008

US$’000

Q32007

US$’000

9 months to30/06/08US$’000

9 months to30/06/07US$’000

Disclosure of expensesincluded in Profit beforetax:

Interest expense – (8) (1) (50)

Depreciation of plant andequipment (1,803) (2,125) (6,045) (5,807)

Allowance for doubtful tradereceivables (50) (49) (150) (199)

Allowance for inventoryobsolescence (50) (102) (200) (209)

Loss on disposal of plant andequipment – – (11) –


210

1(b)(i) A balance sheet (for the issuer and group), together with a comparative statement asat the end of the immediately preceding financial year.

Group

Note 1 Note 2

30/06/08 31/03/08 30/09/07

(US$’000) (US$’000) (US$’000)

Current assets

Cash and short term investments 167,520 162,719 150,491

Receivables from external clients 146,258 129,962 120,678

Advanced billings receivables 6,493 6,055 13,816

Inventories 9,162 6,716 10,163

Other current assets 34,565 34,011 35,818

Total current assets 363,998 339,463 330,966

Non-current assets

Plant and equipment 13,533 14,060 14,337

Intangibles 4,419 4,419 648

Available-for-sale investments 1,253 1,389 1,216

Deferred tax assets 1,792 1,709 1,533

Total non-current assets 20,997 21,577 17,734

Current liabilities

Trade creditors 86,444 74,052 76,433

Other current liabilities 78,451 70,021 68,145

Total current liabilities 164,895 144,073 144,578


Deferred tax liabilities 362 593 634

Net assets 219,738 216,374 203,488

Shareholders’ funds 218,687 215,334 202,536

Minority interests 1,051 1,040 952

219,738 216,374 203,488

Note 1: Balance sheet as at 31 March 2008 is used for comparison.

Note 2: Balance sheet as at 30 September 2007 is included being the latest audited balance sheet.


211

1(b)(i) Balance sheet (Cont’d)Holding Company

30/06/08(US$’000)

30/09/07(US$’000)

Current assets

Cash and bank balances 5,677 10,785

Receivables from subsidiaries 53,311 45,566

Other current assets 2,891 2,903

Total current assets 61,879 59,254

Non-current assets

Investment in subsidiaries 121,375 117,693

Investment in joint venture 408 408

Plant and equipment 2,191 2,364

Total non-current assets 123,974 120,465

Current liabilities

Creditors 26,738 23,105

Other current liabilities 3,844 3,320

Total current liabilities 30,582 26,425

Non-current liability

Deferred tax liabilities 273 268

Net assets 154,998 153,026

Shareholders’ funds 154,998 153,026

1(b)(ii) Aggregate amount of group’s borrowings and debt securities.

Amount repayable in one year or less, or on demand

As at 30/06/2008 As at 30/09/2007

Secured Unsecured Secured Unsecured

– – – –

Amount repayable after one year

As at 30/06/2008 As at 30/09/2007

Secured Unsecured Secured Unsecured

– – – –

Details of any collateral

Not applicable.


212

1(c) A cash flow statement (for the group), together with a comparative statement for thecorresponding period of the immediately preceding financial year.

Q32008

US$’000

Q32007

US$’000

9 months to30/06/08US$’000

9 months to30/06/07US$’000

Cashflows from operating activities:Profit before tax 12,670 10,128 38,591 29,123Adjustments for

Depreciation of plant and equipment 1,803 2,125 6,045 5,807Allowance for doubtful trade receivables 50 49 150 199Allowance for inventory obsolescence 50 102 200 209Share options expense 448 330 1,298 1,040Loss on disposal of plant and equipment – – 11 –Interest income (820) (978) (2,811) (3,100)Interest expense – 8 1 50

Operating cash flows before movements in workingcapital

14,201 11,764 43,485 33,328

Inventories (2,698) 6,762 792 (995)Trade and other receivables (21,933) (2,050) (20,368) (13,251)Trade and other creditors 21,357 (10,177) 17,349 (3,018)

Cash generated from operations 10,927 6,299 41,258 16,064Interest paid – (8) (1) (50)Interest received 820 978 2,811 3,100Income tax paid (1,039) (3,197) (4,948) (7,945)

Net cash from operating activities 10,708 4,072 39,120 11,169

Investing activities:Purchase of plant and equipment (1,713) (2,397) (5,333) (7,252)Proceeds from disposal of plant and equipment – – 2 –Cash outflow on acquisition of new business (Note A) (71) – (3,898) –

Net cash used in investing activities (1,784) (2,397) (9,229) (7,252)

Financing activities:Proceeds from re-issue of treasury shares upon option

exercise– 99 161 267

Cash settlement of share options exercised byemployees

(1) (297) (473) (829)

Purchase of treasury shares – – (1,168) (4,762)Dividends paid – – (9,295) (21,250)Repayment of finance leases – – – (45)

Net cash used in financing activities (1) (198) (10,775) (26,619)

Net effect of exchange rate changes in consolidatingsubsidiaries

(4,122) 1,868 (2,087) 5,391

Net increase/(decrease) in cash and short terminvestments

4,801 3,345 17,029 (17,311)

Cash and short term investments at beginning of period 162,719 130,708 150,491 151,364

Cash and short term investments at end of period 167,520 134,053 167,520 134,053

Note (A) Acquisition of new businessThe fair values of assets and liabilities acquired were as follow:

Q32008

US$’000

Q32007

US$’000

9 months to30/06/08US$’000

9 months to30/06/07US$’000

Trade and other receivables – – (348) –Plant and equipment – – (32) –Trade and other payables – – 253 –Goodwill on acquisition – – (3,771) –

Purchase consideration – – (3,898) –Deferred purchase consideration (71) – – –

Cash outflow on acquisition of new business (71) – (3,898) –


213

1(d

)(i)

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Bal

ance

at30

June

2008

158,

866

(24,

649)

(22)

5,35

153

64,

348

(130

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)20

4,67

221

8,68

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(297

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at30

June

2007

139,

999

(21,

864)

(68)

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(144

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Q3

2008

215

1(d)(i) A statement of equity changes (Cont’d)

Holding Company(US$’000)

Issuedcapital

Treasuryshares

Shareoptions

settlementreserve @

Shareoptionsreserve

Accumulatedprofits Total

Q3 2008 movement

Balance at 1 April 2008 158,866 (24,649) (25) 4,907 12,696 151,795

Net profit for the period – – – – 2,756 2,756

Recognition of share-basedpayment – – – 448 – 448

Arising from the exercise ofshare options via cashsettlement – – 3 (4) – (1)

Balance at 30 June 2008 158,866 (24,649) (22) 5,351 15,452 154,998

Q3 2007 movement

Balance at 1 April 2007 139,999 (21,985) (122) 4,459 9,757 132,108

Net profit for the period – – – – 2,043 2,043

Recognition of share-basedpayment – – – 330 – 330

Re-issue of treasury sharesupon exercise of shareoptions – 121 21 (43) – 99

Arising from the exercise ofshare options via cashsettlement – – 33 (330) – (297)

Balance at 30 June 2007 139,999 (21,864) (68) 4,416 11,800 134,283

@ Share options settlement reserve relates to adjustments arising from the exercise of share options via cashsettlement and/or transfer from treasury shares.

1(d)(ii) Details of any changes in the company’s share capital arising from rights issue,bonus issue, share buy-backs, exercise of share options or warrants, conversion ofother issues of equity securities, issue of shares for cash or as consideration foracquisition or for any other purpose since the end of the previous period reported on.State also the number of shares that may be issued on conversion of all theoutstanding convertibles as at the end of the current financial period reported on andas at the end of the corresponding period of the immediately preceding financial year.

There were no changes in the Company’s share capital during the quarter ended 30 June2008.

2. Whether the figures have been audited or reviewed and in accordance with whichauditing standard or practice.

The figures have not been audited but have been reviewed by the auditors in accordancewith Singapore Standard on Review Engagement 2410.


216

3. Where the figures have been audited or reviewed, the auditors’ report (including anyqualifications or emphasis of a matter).

Please see attached review report.

4. Whether the same accounting policies and methods of computation as in the issuer’smost recently audited annual financial statements have been applied.

The Group has applied the same accounting policies and methods of computation in thefinancial statements for the current reporting period compared with the audited financialstatements for the year ended 30 September 2007.

5. If there are any changes in the accounting policies and methods of computation,including any required by an accounting standard, what has changed, as well as thereasons for, and the effect of, the change.

Not applicable.

6. Earnings per ordinary share of the group for the current financial period reported onand the corresponding period of the immediately preceding financial year, afterdeducting any provision for preference dividends.

Group Group

Q32008

Q32007

9 months to30/06/08

9 months to30/06/07

Earnings per ordinary share forthe period:

(i) Based on the weightedaverage number ofordinary shares in issue

1.95 US cents 1.64 US cents 6.19 US cents 4.71 US cents

(ii) On a fully diluted basis1.95 US cents 1.62 US cents 6.16 US cents 4.68 US cents

Note to item 6(i):The weighted average number of ordinary shares in issue for Q3 2008 and 9 months ended 30 June 2008 is461,890,427 and 451,732,058 respectively (Q3 2007: 447,166,276 and 9 months ended 30 June 2007:449,255,485).

Note to item 6(ii):The earnings per share on a fully diluted basis is calculated on the adjusted weighted average number of ordinaryshares of 463,028,138 (Q3 2008) and 453,255,930 (9 months ended 30 June 2008) in issue during the periodreported on. (Q3 2007: 451,270,756 and 9 months ended 30 June 2007: 452,025,445)

There are no preference shares in the Company.


217

7. Net asset value (for the issuer and group) per ordinary share based on issued sharecapital of the issuer at the end of the:–

(a) current financial period reported on; and

(b) immediately preceding financial year.

Group Holding Company

30/06/08 30/09/07 30/06/08 30/09/07

Net asset value per ordinary sharebased on issued share capital

46.39 US cents 45.30 US cents 33.56 US cents 34.33 US cents

The net asset value per ordinary share is computed based on 461,890,427 (30 September 2007: 445,687,683)ordinary shares.

Note: Net asset value herein refers to net tangible assets.

8. A review of the performance of the group, to the extent necessary for a reasonableunderstanding of the group’s business. It must include a discussion of thefollowing:–

(a) any significant factors that affected the turnover, costs, and earnings of thegroup for the current financial period reported on, including (where applicable)seasonal or cyclical factors; and

(b) any material factors that affected the cash flow, working capital, assets orliabilities of the group during the current financial period reported on.

Datacraft turned in a third quarter net profit attributable to shareholders of US$9.0 million,representing a year-over-year increase of 23%, on the back of a 27% rise in revenue toUS$187.3 million. For the 9 months to June 2008, Group revenue rose 29% to US$541.0million, while profit after tax attributable to shareholders increased 32% to US$27.9 million.

The 27% revenue growth in Q3 FY2008 was attributable to strong performance from bothservices and hardware sales. Services revenue grew 37% year-over-year to US$68.6 millionwhile hardware revenue grew 22% to US$118.7 million.

Gross profit for the Group at US$34.4 million was 24% higher year-over-year. Thecorresponding gross margin was 18.3%, compared with 18.8% for the same quarter lastyear reflecting increased pricing pressure in the market place but was stable compared tothe 18.2% in the prior quarter.

Distribution, selling and administrative expenses (SG&A) totalled US$22.4 millionrepresenting 12.0% of revenue, and is consistent with the 12% -13% trend in prior quarters.In terms of dollar value comparison, SG&A increased by 26% over the same quarter lastyear. This was largely due to an increase in headcount to support business growth and theGroup’s vertical market focus, as well as to strengthen capability in certain geographies.

Group profit before tax improved by 25% year-over-year to US$12.7 million and Group profitafter tax attributable to shareholders grew 23% to US$9.0 million.


218

From a geographic perspective, revenue contribution from East Asia declined 20%year-over-year due to weak results from Korea and Japan. However, this was more thanoffset by strong performance in the other three regions of Asean, India & New Zealand andGreater China, which reported robust year-over-year revenue growth.

From a balance sheet perspective, the Group’s financials remained strong. The Groupgenerated US$10.7 million cash flow from operations in Q3, and a total of US$39.1 millionover the 9-month period. The Group’s net cash and investments as at end of June 2008 wasUS$167.5 million.

The Group ended Q3 with an order backlog of US$205 million. This comprised US$83million orders for hardware and short term services, typically delivered in the next 90 days,and US$122 million orders for annuity services, typically delivered over a longer period oftime. The annuity services backlog, which increased by US$8 million sequentially, wasboosted by several large wins from the financial services vertical, whilst the hardware andshort term services order backlog was US$9 million lower.

9. Where a forecast, or a prospect statement, has been previously disclosed toshareholders, any variance between it and the actual results.

No forecast was made previously.

10. A commentary at the date of the announcement of the significant trends andcompetitive conditions of the industry in which the group operates and any knownfactors or events that may affect the group in the next reporting period and the next12 months.

Against the backdrop of growing economic uncertainties in the global markets, the Group isseeing increased caution and some budget tightening in the market place. In a morecapital-constrained environment, clients are likely to cut back on discretionary IT spendingwhich will impact demand for hardware and short term services, but are likely to continuespending on support and maintenance thus benefiting our annuity services business.

Balanced against these, there remains strong demand for solutions and services to reducecosts, improve efficiencies and optimise performance, which Datacraft is well positioned todeliver. There is also growing interest in incorporating greater flexibility in the pricing andfinancing of IT services which presents new business opportunities for the Group.

Market sentiment is likely to remain cautious until there is a recovery in the global financialmarkets and economic conditions.

On 22 July 2008, Datacraft made a joint announcement with Dimension Data on the latter’sintent to acquire the remaining 44.9% of the issued shares of Datacraft which it does notalready own. The proposed acquisition will be effected by way of a Scheme of Arrangementunder the Singapore Companies Act. Shareholders should refer to the joint announcementfor details of the Scheme.


219

11. Dividend

(a) Current Financial Period Reported On

Any dividend declared for the current financial period reported on? No

(b) Corresponding Period of the Immediately Preceding Financial Year

Any dividend declared for the corresponding period of the immediately precedingfinancial year?

None

(c) Date payable

Not applicable

(d) Books closure date

Not applicable

12. If no dividend has been declared/recommended, a statement to that effect.

Not applicable.

13. Interested Person Transactions (“IPTs”)

In US$’000

Q3 FY2008

Name of interested person

Aggregate value ofall IPTs during Q3FY2008 (excludingtransactions less

than S$100,000 andexcluding

transactionsconducted underthe shareholders’

mandate on 20January 2006 )

Aggregate value ofall IPTs during Q3FY2008 conducted

under theshareholders’mandate on 20January 2006

(excludingtransactions lessthan S$100,000)

Transactions > S$100,000 Yes Yes

Defined by IPT Mandate approved on 29January 2008 + Not applicable Yes

Dimension Data Commerce Centre Ltd 663 3,843

Dimension Data Management Services (Pty)Ltd 317 –

Dimension Data North America Inc 118 –

Dimension Data Australia Pty Limited 100 –

Dimension Data Nederland BV 83 –

+ Shareholders’ approval for the renewal of the IPT Mandate was obtained on 29 January 2008 for purchasesfrom Dimension Data Commerce Centre Ltd for servicing certain global clients, mainly HSBC.


220

14. Directors’ Responsibility Statement

The directors of Datacraft (including any director who may have delegated detailedsupervision of this Announcement) have taken all reasonable care to ensure that the factsstated and opinions expressed in this Announcement are fair and accurate and that nomaterial facts have been omitted from this Announcement, and they jointly and severallyaccept responsibility accordingly. Where any information has been extracted from publishedor publicly available sources, the sole responsibility of the directors of Datacraft has been toensure through reasonable enquiries that such information is accurately extracted from suchsources or, as the case may be, reflected or reproduced in this Announcement.

BY ORDER OF THE BOARD

Patrick QuarmbyChairman

Confirmation by the Board

We, William Bruce Grahame Padfield and Frank Yung-Cheng Yung, being two directors of DatacraftAsia Ltd (the “Company”), do hereby confirm on behalf of the directors of the Company that, to the bestof our knowledge, nothing has come to the attention of the Board of Directors of the Company whichmay render the third quarterly results of the Company for the three months ended 30 June 2008 to befalse or misleading.

On behalf of the Board of Directors

William Bruce Grahame PadfieldDirector

Frank Yung-Cheng YungDirector

13 August 2008


221

The Board of DirectorsDatacraft Asia Ltd6 Temasek Boulevard#26-01/05 Suntec Tower FourSingapore 038986

Dear Sirs

REPORT ON REVIEW OF INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS TOTHE MEMBERS OF DATACRAFT ASIA LTD FOR THE THREE-MONTH PERIOD AND NINE-MONTHPERIOD ENDED JUNE 30, 2008

Introduction

We have reviewed the accompanying interim condensed consolidated financial statements of DatacraftAsia Ltd (the “Company” or “Datacraft”) and its subsidiaries (collectively know as the “Group”) whichcomprise the balance sheets of the Group and the Company as at June 30, 2008, the statement ofchanges in shareholders’ equity of the Group and the Company, and the profit and loss statement andthe cash flow statement of the Group for the three-month period and nine-month period then ended andexplanatory notes.

Management is responsible for the preparation and presentation of these interim condensedconsolidated financial statements in accordance with Singapore Financial Reporting Standard 34,Interim Financial Reporting (“FRS 34”). Our responsibility is to express a conclusion on these interimcondensed consolidated financial statements based on our review.

The comparative interim condensed consolidated financial statements as at and for the three-monthperiod and nine-month period ended June 30, 2007 have not been audited or reviewed.

APPENDIX 7: DELOITTE & TOUCHE LLP’S REPORT ON REVIEW OF INTERIMCONDENSED CONSOLIDATED FINANCIAL STATEMENTS TO THE MEMBERSOF DATACRAFT ASIA LTD FOR THE THREE-MONTH PERIOD AND NINE-MONTH

PERIOD ENDED JUNE 30, 2008

222

Scope of Review

We conducted our review in accordance with the Singapore Standard on Review Engagements (SSRE)2410, Review of Interim Financial Information Performed by the Independent Auditor of the Entity. Ourreview of interim financial information consists of making inquiries, primarily of persons responsible forfinancial and accounting matters, and applying analytical and other review procedures. A review issubstantially less in scope than an audit conducted in accordance with Singapore Standards onAuditing and consequently does not enable us to obtain assurance that we would become aware of allsignificant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, except for the non disclosure of segmental information, nothing has come to ourattention that the accompanying interim condensed consolidated financial statements are not prepared,in all material respects, in accordance with FRS 34.

Yours faithfully,

Deloitte & Touche LLPPublic Accountants andCertified Public AccountantsSingapore

August 13, 2008

APPENDIX 7: DELOITTE & TOUCHE LLP’S REPORT ON REVIEW OF INTERIMCONDENSED CONSOLIDATED FINANCIAL STATEMENTS TO THE MEMBERSOF DATACRAFT ASIA LTD FOR THE THREE-MONTH PERIOD AND NINE-MONTH

PERIOD ENDED JUNE 30, 2008

223

22 September 2008

To: The Independent DirectorsDatacraft Asia Limited6 Temasek Boulevard#26-01/05 Suntec Tower FourSingapore 038986

Dear Sirs



This letter has been prepared for inclusion in the scheme document dated 22 September 2008(“Scheme Document”) in connection with the proposed scheme of arrangement to privatise DatacraftAsia Ltd (“Datacraft” or “Company”) under Section 210 of the Companies Act, Chapter 50 ofSingapore.

On 13 August 2008, the Company announced its third quarter financial statements for the nine monthsfinancial period ended 30 June 2008 (“Interim Financial Results”). The Interim Financial Results issolely the responsibility of the directors of the Company (“Directors”). Details of the Interim FinancialResults are set out in Appendix 6 of the Scheme Document.

We have examined the Company’s review process and have held discussions with the management ofthe Company on the Interim Financial Results. We have also considered the report dated 13 August2008 addressed to the Directors by the Company’s auditors, Deloitte & Touche LLP, in relation to itsreview of the Company’s Interim Financial Results for the nine months financial period ended 30 June2008 as set out in Appendix 7 of the Scheme Document.

In rendering our opinion, we have relied on the accuracy and completeness of all information providedto, or discussed with us and have not verified the accuracy and completeness of such information forthe purposes of rendering our opinion in this letter. Save as provided in this letter, we do not expressany other opinion on the Interim Financial Results.

Based on the above, we are of the view that the Interim Financial Results have been prepared by theDirectors after due and careful enquiry.

This letter is addressed to the Directors for the sole purpose of complying with Rule 25 of the SingaporeCode on Take-overs and Mergers and not for any other purpose. We do not accept any responsibilityto any other person (other than to the Directors) in respect of, arising from or in connection with thisletter.

Yours faithfullyFor and on behalf ofPricewaterhouseCoopers Corporate Finance Pte Ltd

Kan Yut KeongManaging Director

Jolly TanAssociate Director

APPENDIX 8: LETTER FROM PWCCF ON THE UNAUDITED CONSOLIDATEDFINANCIAL STATEMENTS OF THE COMPANY FOR Q3 2008

224

The representations and warranties of the Company in the Implementation Agreement are reproducedin this Appendix 9. All capitalised terms used and defined herein shall have the same meanings givento them in the Implementation Agreement, a copy of which is available for inspection at the registeredoffice of the Company during normal business hours until the date the Scheme becomes effective.

The Company represents and warrants that:

1. Status

The Company is duly incorporated in the Republic of Singapore with company registration number199301842Z and validly existing under its law of incorporation. As of the date of theImplementation Agreement, the issued share capital of the Company is US$158,866,000consisting of 461,890,427 ordinary shares (excluding 23,321,000 treasury shares).

2. Power

The Company has the corporate power to enter into and perform its obligations under theImplementation Agreement and to carry out the transactions contemplated by the ImplementationAgreement.

3. Authority

The Company has taken all necessary corporate action and obtained all necessary corporateapproval to authorise the entry into the Implementation Agreement and the performance of theImplementation Agreement and to carry out the transactions contemplated in the ImplementationAgreement.

4. Consents

The Company shall obtain all actions, conditions and things required to be taken, fulfilled anddone (including the obtaining of any necessary consents from third parties) in order to:

(a) enable the Company lawfully to enter into, exercise its rights and perform and comply withits obligations under the Implementation Agreement; and

(b) ensure that those obligations are valid, legally binding and enforceable have been taken,fulfilled and done

5. Binding Obligation

The Company’s obligations under the Implementation Agreement are valid, legally binding andenforceable in accordance with its terms.

6. No Breach

Neither the execution nor performance by the Company of the Implementation Agreement nor anytransaction contemplated under the Implementation Agreement will violate any provision of itsconstitutive documents, any order, writ, injunction or decree of any Governmental Agencyapplicable to the Company or its assets, or any agreement or instrument to which the Companyis a party or by which the Company or its assets are bound.

7. Cash

The Company has sufficient cash resources, free from Encumbrances, to effect the CapitalDistribution and it is not aware of any fact, matter or circumstance which may affect the availabilityof cash resources to effect the Capital Distribution.

APPENDIX 9: THE COMPANY’S REPRESENTATIONS AND WARRANTIES

225

The representations and warranties of Dimension Data in the Implementation Agreement arereproduced in this Appendix 10. All capitalised terms used and defined herein shall have the samemeanings given to them in the Implementation Agreement, a copy of which is available for inspectionat the registered office of the Company during normal business hours until the date the Schemebecomes effective.

Dimension Data represents and warrants that:

1. Status

Dimension Data is a company duly incorporated in England and Wales, with company registrationnumber 3704278 and validly existing under its law of incorporation.

2. Power

Dimension Data has the corporate power to enter into and perform its obligations under theImplementation Agreement and to carry out the transactions contemplated by the ImplementationAgreement.

3. Authority

Dimension Data has taken all necessary corporate action and obtained all necessary corporateapproval to authorise the entry into the Implementation Agreement and the performance of theImplementation Agreement and to carry out the transactions contemplated in the ImplementationAgreement.

4. Consents

Dimension Data shall obtain all actions, conditions and things required to be taken, fulfilled anddone (including the obtaining of any necessary consents from third parties) in order to:

(a) enable Dimension Data lawfully to enter into, exercise its rights and perform and comply withits obligations under the Implementation Agreement; and

(b) ensure that those obligations are valid, legally binding and enforceable have been taken,fulfilled and done.

5. Binding Obligation

Dimension Data’s obligations under the Implementation Agreement are valid, legally binding andenforceable in accordance with its terms.

6. No Breach

Neither the execution nor performance by Dimension Data of the Implementation Agreement norany transaction contemplated under the Implementation Agreement will violate any provision of itsconstitutive documents, any order, writ, injunction or decree of any Governmental Agencyapplicable to Dimension Data or its assets, or any agreement or instrument to which DimensionData is a party or by which Dimension Data or its assets are bound.

7. Financial Resources

Dimension Data has the financial resources to undertake and implement the Scheme.

APPENDIX 10: DIMENSION DATA’S REPRESENTATIONS AND WARRANTIES

226

For the purpose of this Document, “Prescribed Occurrence”, in relation to any of the Datacraft GroupCompanies, means any of the following:

1. Resolution for Winding Up: the Company (or any subsidiary of the Company) resolving that itbe wound up;

2. Appointment of Liquidator and Judicial Manager: the appointment of a liquidator, provisionalliquidator, judicial manager, provisional judicial manager and/or similar officer of the Company (orof any subsidiary of the Company);

3. Order of Court for Winding Up: the making of an order by a court of competent jurisdiction forthe winding up of the Company (or any subsidiary of the Company);

4. Composition: the Company (or any subsidiary of the Company) entering into any arrangementor general assignment or composition for the benefit of its creditors generally;

5. Appointment of Receiver: the appointment of a receiver or a receiver and manager, in relationto the property or assets of the Company (or of any subsidiary of the Company);

6. Insolvency: any event occurs which, under the laws of any jurisdiction, has an analogous orequivalent effect to any of the foregoing event(s);

7. Cessation of Business: the Company (or any subsidiary of the Company) ceases or threatensto cease for any reason to carry on business in the usual course;

8. Breach of Agreement: the Company being in material breach of any provisions of theImplementation Agreement;

9. Investigations and Proceedings: if the Company (or any subsidiary of the Company) or any ofits directors is or will be the subject of any governmental, quasi-governmental, criminal, regulatoryor stock exchange investigation and/or proceeding; or

10. Analogous Event: the Company (or any subsidiary of the Company) becoming or being deemedby law or a court to be insolvent or stops or suspends or threatens to stop or suspend paymentof its debts.

APPENDIX 11: PRESCRIBED OCCURRENCES

227

IN THE HIGH COURT OF THE REPUBLIC OF SINGAPORE

Originating Summons )Number 1164 of 2008/T )

In the matter of

Datacraft Asia Ltd

(Co. Reg. No. 199301842Z)

And

In the matter of Section 210 of

the Companies Act, Chapter 50

SCHEME OF ARRANGEMENT

under Section 210 of the Companies Act, Chapter 50

Between

Datacraft Asia Ltd

And

the Scheme Shareholders (as defined herein)

And

Dimension Data Holdings plc

THE SCHEME

228

PRELIMINARY

In this Scheme of Arrangement, except to the extent that the context requires otherwise, the followingexpressions bear the following respective meanings, namely:

Expression Meaning

“Act” The Companies Act, Chapter 50 of Singapore

“Announcement Date” 22 July 2008, being the date of the joint announcementmade by the Company and Dimension Data on SGX-ST inrelation to the Scheme and the Capital Distribution

“Books Closure Date” A date and time to be announced (before the Effective Date)by the Company on which the transfer books of theCompany and the Register of Members of the Company willbe closed in order to determine the entitlements of theScheme Shareholders under the Scheme and to the CapitalDistribution

“Business Day” A day (other than a Saturday, Sunday or public holiday) onwhich commercial banks are open for business inSingapore

“Capital Distribution” The capital distribution of US$0.24 in cash for each SchemeShare held by the Scheme Shareholders as at the BooksClosure Date, to be effected by way of the CapitalReduction

“Capital Reduction” The cancellation of up to US$52,600,000 of the issuedshare capital of the Company without any cancellation ofShares

“Cash Consideration” The aggregate cash amount of US$1.33 in cash for eachShare transferred, comprising (a) a payment of US$1.09 incash from Dimension Data for each issued Sharetransferred; and (b) a payment of US$0.24 in cash from theCompany for each issued Share held as at the BooksClosure Date pursuant to the Capital Distribution

“CDP” The Central Depository (Pte) Limited

“Company” or “Datacraft” Datacraft Asia Ltd

“Court” The High Court of the Republic of Singapore

“Court Meeting” The meeting of Scheme Shareholders to be convened andheld under the directions of the Court, notice of which is setout on pages 236 to 238 of the Document, and anyadjournment thereof

THE SCHEME

229

Expression Meaning

“Datacraft Asia Share OptionScheme 1996”

The share option scheme for the granting of DatacraftOptions to the employees and executive directors of theDatacraft Group, approved and adopted at an extraordinarygeneral meeting of Datacraft held on 19 August 1996, assubsequently amended at extraordinary general meetingsof Datacraft held on 15 January 1998, 7 April 2000 and 20January 2006

“Datacraft Asia Share OptionScheme 2003”

The share option scheme for the granting of DatacraftOptions to the employees and executive directors of theDatacraft Group, approved and adopted at an extraordinarygeneral meeting of Datacraft held on 27 February 2003, assubsequently amended at an extraordinary general meetingof Datacraft held on 20 January 2006

“Datacraft Share Option Schemes” The Datacraft Asia Share Option Scheme 1996 and theDatacraft Asia Share Option Scheme 2003

“Datacraft Share Plan” The share incentive scheme for the granting of DatacraftShares to employees and executive directors of eligiblerank of the Datacraft Group, approved and adopted at anextraordinary general meeting of Datacraft held on 20January 2006

“Dimension Data” Dimension Data Holdings plc

“Directors” or the “Board” The directors of the Company as at the Latest PracticableDate

“Document” The document dated 22 September 2008 containinginformation on the Scheme and the Capital Distribution

“Effective Date” The date on which the Scheme if approved, becomeseffective and binding in accordance with Clause 10 of thisScheme

“Entitled Scheme Shareholders” Scheme Shareholders as at 5.00 p.m. on the Books ClosureDate

“Excluded Shareholders” Dimension Data, its related corporations and theirrespective nominees

“Implementation Agreement” The agreement dated 22 July 2008 entered into betweenthe Company and Dimension Data to implement theScheme and the Capital Distribution

“Latest Practicable Date” 15 September 2008, being the latest practicable date priorto the printing of the Document

“Options” Options to subscribe for new Shares granted pursuant tothe Datacraft Share Option Schemes

THE SCHEME

230

Expression Meaning

“Relevant Court Date” The first day on which the Court hears the application for anorder under Section 210 of the Companies Act approvingthe Scheme or, if the application is adjourned or subject toappeal for any reason, the first day on which the adjournedor appealed application is heard

“Scheme” This scheme of arrangement in its present form or with orsubject to any modification thereof or addition thereto inaccordance with Clause 12 herein or condition(s) approvedor imposed by the Court

“Scheme Shareholders” All Shareholders other than the Excluded Shareholders

“Scheme Shares” All the Shares held by the Scheme Shareholders as at theBooks Closure Date

“SGX-ST” The Singapore Exchange Securities Trading Limited

“Shareholders” Persons who are registered as holders of Shares (excludingtreasury shares) in the Register of Members of theCompany or who, being Depositors, have Shares enteredagainst their names in the Depository Register, includingpersons entitled by transmission

“Shares” The issued ordinary shares in the capital of the Company

“S$” and “cents” Singapore dollars and cents respectively, being the lawfulcurrency of Singapore

“US$” and “US cents” United States dollars and cents respectively, being thelawful currency of the United States of America

“%” or “per cent.” Per centum or percentage

The terms “Depositor”, “Depository Agent” and “Depository Register” shall have the respectivemeanings ascribed to them in Section 130A of the Companies Act, and the terms “subsidiary” and“related corporation” shall have the meanings ascribed to them in Sections 5 and 6 of the CompaniesAct respectively.

The term “holder”, in relation to any share, includes a person entitled to that share by transmission.

A reference to an enactment or statutory provision shall include a reference to any subordinatelegislation made under the relevant enactment or statutory provision and is a reference to thatenactment, statutory provision or subordinate legislation as from time to time amended, consolidated,modified, re-enacted or replaced.

Words in the singular shall include the plural and vice versa.

References to one gender include other genders.

If a period of time is specified as from a given day, or from the day of an act or event, it shall becalculated exclusive of that day.

THE SCHEME

231

References for times or dates shall be references to the time or date in Singapore.

RECITALS

(A) The Company was incorporated in Singapore on 29 March 1993 and was listed on the Mainboardof the SGX-ST in 1995.

(B) As at the Latest Practicable Date, the Company has (a) 461,981,427 Shares in issue; (b)outstanding Options to subscribe for an aggregate of 27,726,000 Shares under the DatacraftShare Option Schemes; and (c) outstanding awards in respect of 1,098,000 Shares under theDatacraft Share Plan.

If all the outstanding Options are fully exercised and all the outstanding awards of Shares are fullyvested, the total number of Shares in issue would be 490,805,427 Shares issued on or prior to theBooks Closure Date upon the exercise of the Options and the vesting of the awards of Shares willform part of the Scheme Shares.

(C) The primary purpose of this Scheme is the acquisition by Dimension Data of all the SchemeShares.

(D) The Company and Dimension Data have entered into the Implementation Agreement to set outtheir respective obligations with respect to the Scheme and the Capital Distribution (which is anintegral part of the Scheme).

(E) Dimension Data has agreed to appear by Counsel at the hearing of the Originating Summons tosanction this Scheme, and to consent thereto, and to undertake to the Court to be bound therebyand to execute and do and procure to be executed and done all such documents, acts and thingsas may be necessary or desirable to be executed or done by it for the purpose of giving effect tothis Scheme.

PART I

CONDITIONS PRECEDENT

1. This Scheme is conditional upon:

(a) each condition precedent set out in Clause 3.1 of the Implementation Agreement beingsatisfied or, subject to the terms of the Implementation Agreement, being waived; and

(b) As at 8.00 a.m. on the Relevant Court Date, the Implementation Agreement not having beenterminated.

PART II

TRANSFER OF SHARES

2. With effect from the Effective Date, all outstanding Scheme Shares will be transferred fully paid,free from all liens, equities, charges, encumbrances, rights of pre-emption and any other thirdparty rights or interests or any nature whatsoever and together with all rights attached thereto asat the Announcement Date, including the right to receive and retain all dividends, rights and, savefor the Capital Distribution, other distributions (if any) declared, paid or made by the Company onor after the Announcement Date.

3. Against the transfer of the Scheme Shares provided in Clause 2 of this Scheme:

(a) in the case of Entitled Scheme Shareholders (being Depositors), the Company shall instructCDP, for and on behalf of the Entitled Scheme Shareholders, to debit, not later than three

THE SCHEME

232

(3) Business Days after the Effective Date, all the Scheme Shares standing to the credit ofthe Securities Account of such Entitled Scheme Shareholders and credit all of such SchemeShares to the Securities Account of Dimension Data and/or its nominees or such SecuritiesAccount as directed by Dimension Data; and

(b) in the case of Entitled Scheme Shareholders (not being Depositors), the Company shallauthorize any person to execute or effect on behalf of all such Entitled SchemeShareholders, an instrument or instruction of transfer of all Scheme Shares held by suchEntitled Scheme Shareholders, and every such instrument or instruction of transfer soexecuted shall be effective as if it had been executed by the relevant Entitled SchemeShareholder.

PART III

PAYMENT OF CONSIDERATION

4. In consideration for the transfer of all outstanding Scheme Shares to Dimension Data underClause 2 and subject to Clause 1:

(a) Dimension Data shall pay or procure that there shall be paid to each Entitled SchemeShareholder, US$1.09 in cash for each issued Scheme Share transferred, pursuant to theScheme; and

(b) the Company shall pay or procure that there shall be paid to each Entitled SchemeShareholder, US$0.24 in cash for each issued Scheme Share transferred, pursuant to theCapital Distribution.

5. Dimension Data shall, not later than ten (10) calendar days after the Effective Date, and againstthe transfer of the Scheme Shares set out in Clause 2, make payment of the Scheme Pricepayable on the transfer of the Scheme Shares to:

(a) each Entitled Scheme Shareholder (not being a Depositor) by sending a cheque for theaggregate Scheme Price payable to such Entitled Scheme Shareholder made out in favourof such Entitled Scheme Shareholder by post to his address in the Register of Members ofthe Company at the close of business on the latest practicable date prior to the despatch ofsuch cheque, at the sole risk of such Entitled Scheme Shareholder, or in the case of jointEntitled Scheme Shareholders, to the first named Entitled Scheme Shareholder made out infavour of such Entitled Scheme Shareholder by post to his address in the Register ofMembers of the Company at the close of business on the latest practicable date prior to thedespatch of such cheque, at the sole risk of such Entitled Scheme Shareholders; and

(b) each Entitled Scheme Shareholder (being a Depositor) by making payment of the aggregateScheme Price payable to such Entitled Scheme Shareholder to CDP. CDP shall send tosuch Entitled Scheme Shareholder, by post to his address in the Depository Register at theclose of business on the latest practicable date prior to the despatch of such cheque and atthe sole risk of such Entitled Scheme Shareholder, a cheque for the payment of suchaggregate Scheme Price made out in favour of such Entitled Scheme Shareholder.

THE SCHEME

233

6. The Company shall, not later than ten (10) calendar days after the Effective Date and against thetransfer of the Scheme Shares set out in Clause 2 above, make payment of the CapitalDistribution to each Entitled Scheme Shareholder (whose entitlement to the Capital Distributionshall be determined on the basis of the Entitled Scheme Shareholder’s holdings of SchemeShares in the Register of Members and/or the Depository Register as at the Books Closure Date)as follows:

(a) for each Entitled Scheme Shareholder (not being a Depositor) entitled thereto by sending acheque for the Capital Distribution payable to such Entitled Scheme Shareholder made outin favour of such Entitled Scheme Shareholder by post to his address in the Register ofMembers of the Company at the close of business on the latest practicable date prior to thedespatch of such cheque, at the sole risk of such Entitled Scheme Shareholder, or in thecase of joint Entitled Scheme Shareholders, to the first named Entitled Scheme Shareholdermade out in favour of such Entitled Scheme Shareholder by post to his address in theRegister of Members of the Company at the close of business on the latest practicable dateprior to the despatch of such cheque, at the sole risk of such Entitled Scheme Shareholders;and

(b) for each Entitled Scheme Shareholder (being a Depositor) by making payment of the CapitalDistribution payable to such Entitled Scheme Shareholder to CDP. CDP shall send to suchEntitled Scheme Shareholder, by post to his address in the Depository Register at the closeof business on the latest practicable date prior to the despatch of such cheque and at thesole risk of such Entitled Scheme Shareholder, a cheque for the payment of the CapitalDistribution made out in favour of such Entitled Scheme Shareholder.

7. The encashment of any cheque referred to in Clauses 5 and 6 of this Scheme shall be gooddischarge to Dimension Data, the Company and CDP for the monies represented thereby.

8. (a) On or after the day being six (6) calendar months after the posting of such cheques relatingto the Scheme Price by Dimension Data and the Capital Distribution by the Company,Dimension Data and the Company shall have the right to cancel or countermand paymentof any such cheque which has not been cashed (or has been returned uncashed) and shallplace each of the Scheme Price monies and the Capital Distribution monies in two bankaccounts in Dimension Data’s name in respect of the Scheme Price monies and theCompany’s name in respect of the Capital Distribution monies, each with a licensed bank inSingapore selected by Dimension Data and the Company.

(b) Each of Dimension Data and the Company or their successor entities shall hold such moniesuntil the expiration of six (6) years from the Effective Date and shall prior to such date makepayments therefrom of sums payable pursuant to Clauses 5 and 6 of the Scheme to personswho satisfy Dimension Data in respect of the Scheme Price monies and/or the Company inrespect of the Capital Distribution monies or their successor entities that they arerespectively entitled thereto and that the cheques referred to in Clauses 5 and 6 of theScheme for which they are payees have not been cashed. Any such determination shall beconclusive and binding upon all persons claiming an interest in the relevant monies, and anypayments made by the Company hereunder shall not include any interest accrued on thesums to which the respective persons are entitled pursuant to Clause 4 of this Scheme.

(c) On the expiry of six (6) years from the Effective Date, each of Dimension Data and theCompany shall be released from any further obligation to make any payments of theScheme Price under the Scheme and the Capital Distribution, and the Company and itssuccessor entity shall transfer to Dimension Data the balance (if any) of the sums thenstanding to the credit of the bank account referred to in Clause 8(a) of the Scheme, including

THE SCHEME

234

accrued interest subject, if applicable, to the deduction of interest, tax or any withholding taxor any other deduction required by law and subject to the deduction of any expenses.

(d) Clause 8(c) of this Scheme shall take effect subject to any prohibition or condition imposedby law.

9. On and as from the Effective Date, each existing share certificate representing a former holdingof Shares by Entitled Scheme Shareholders (not being Depositors) will cease to be evidence oftitle to the Shares represented thereby and each Entitled Scheme Shareholder (not beingDepositors) shall be required to forward his existing share certificate relating to their Shares to theShare Registrar, Tricor Barbinder Share Registration Services (a division of Tricor Singapore Pte.Ltd.), at 8 Cross Street #11-00, PWC Building, Singapore 048424, before the Effective Date forcancellation.

PART IV

EFFECTIVE DATE

10. Subject to the satisfaction of the conditions precedent set out in Clause 1 of this Scheme, thisScheme shall become effective upon a copy of the order of the Court sanctioning this Schemeunder Section 210 of the Companies Act being duly lodged with the Accounting and CorporateRegulatory Authority Singapore for registration.

11. Unless this Scheme shall have become effective as aforesaid on or before 31 January 2009 (orsuch later date as the Court on the application of the Company or Dimension Data allows), thisScheme shall lapse.

12. The Company and Dimension Data may jointly consent, for and on behalf of all concerned, to anymodification of, or amendment to, this Scheme or to any condition which the Court may think fitto approve or impose.

13. This Scheme shall be governed by, and construed in accordance with, the laws of Singapore, andthe Company, Dimension Data and the Scheme Shareholders submit to the non-exclusivejurisdiction of the courts of Singapore. Save as provided for in this Scheme, a person who is nota party to this Scheme has no rights under the Contracts (Rights of Third Parties) Act, Chapter53B of Singapore, to enforce any term or provision of this Scheme

Dated this 22 September 2008

THE SCHEME

235


Originating Summons )Number 1164 of 2008/T )

In the matter ofDatacraft Asia Ltd(Co. Reg. No. 199301842Z)

And

In the matter ofSection 210 of the Companies Act,Chapter 50



Between

Datacraft Asia Ltd

And

the Scheme Shareholders (as defined herein)

And


NOTICE OF COURT MEETING

NOTICE IS HEREBY GIVEN that by an Order of Court dated 9 September 2008 made in the abovematter, the High Court of the Republic of Singapore (the “Court”) has directed a meeting (the “CourtMeeting”) to be convened of the Scheme Shareholders (as defined in the Schedule hereto) of DatacraftAsia Ltd (the “Company”), and such Court Meeting shall be held at Conrad Centennial Singapore, 2Temasek Boulevard, Singapore 038982 on 15 October 2008 at 2.00 p.m. for the purpose ofconsidering, and if thought fit, approving (with or without modification) the following resolution:

“That contingent on the passing of the Capital Distribution Resolution by the SchemeShareholders at the EGM, the Scheme of Arrangement dated 22 September 2008 proposedto be made pursuant to Section 210 of the Companies Act, Chapter 50, between (i) theCompany, (ii) the Scheme Shareholders (as defined therein); and (iii) Dimension DataHoldings plc, a copy of which has been circulated with the Notice convening this Meeting,be and is hereby approved.”


236

A copy of the said Scheme of Arrangement and the Explanatory Statement required to be furnishedpursuant to Section 211 of the Companies Act, Chapter 50, are incorporated in the printed documentof which this Notice forms part.

Copies of the printed document of which this Notice forms part may be obtained on request at theregistered office of the Company at 6 Temasek Boulevard, #26-01/05 Suntec Tower Four, Singapore038986 or at the office of the Company’s share registrar, Tricor Barbinder Share Registration Services(a division of Tricor Singapore Pte. Ltd.), at 8 Cross Street, #11-00 PWC Building, Singapore 048424during usual business hours on any day (other than a public holiday, Saturday or Sunday) prior to theday appointed for the Court Meeting.

Scheme Shareholders may vote in person at the Court Meeting or may appoint another person,whether a member of the Company or not, as his proxy to attend and vote in his stead.

A form of proxy applicable for the Court Meeting is enclosed with the printed document of which thisNotice forms part.

It is requested that forms appointing proxies be lodged at the registered office of the Company at 6Temasek Boulevard, #26-01/05 Suntec Tower Four, Singapore 038986, not less than forty-eight (48)hours before the time appointed for the Court Meeting, or if the forms are not so lodged, they may behanded to the Chairman of the Court Meeting at the Court Meeting.

In the case of joint Scheme Shareholders, the vote of the senior who tenders a vote, whether in personor by proxy, will be accepted to the exclusion of the vote or votes of the other joint holder or holders,and for this purpose seniority will be determined by the order in which the names stand in the registerof members of the Company.

By the Order of Court, the Court has appointed Mr. Frank Yung-Cheng Yung, or failing him, any otherdirector of the Company, to act as the Chairman of the Court Meeting and has directed the Chairmanto report the results thereof to the Court.

The Scheme will be subject to the subsequent approval of the Court.


237

THE SCHEDULE

Expression Meaning

“Capital Distribution” The capital distribution of US$0.24 in cash for each ordinaryshare in the capital of the Company held by the SchemeShareholders as at a books closure date to be determined,to be effected by way of the Capital Reduction;

“Capital Distribution Resolution” The special resolution to be proposed to the SchemeShareholders at the EGM to approve the CapitalDistribution;

“Capital Reduction” The cancellation of up to US$52,600,000 of the issuedshare capital of the Company without any cancellation ofshares of the Company;

“EGM” The Extraordinary General Meeting of the Company to beconvened to seek the approval of the Scheme Shareholdersfor the Capital Distribution Resolution; and

“Scheme Shareholders” Persons who are registered as holders of Shares in theRegister of Members of the Company other than DimensionData Holdings plc, its related corporations (as such term isdefined in Section 6 of the Companies Act, Chapter 50) andtheir respective nominees, except that where the registeredholder is The Central Depository (Pte) Limited, suchpersons shall mean the Depositors who have Sharescredited to their securities accounts.

Dated 22 September 2008

STAMFORD LAW CORPORATION9 Raffles Place#32-00 Republic PlazaSingapore 048619

Solicitors for the Company


238



NOTICE OF EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that an EXTRAORDINARY GENERAL MEETING of Datacraft Asia Ltd(the “Company”) will be held at Conrad Centennial Singapore, 2 Temasek Boulevard, Singapore038982 on 15 October 2008 at 2.30 p.m., or as soon thereafter following the conclusion of the CourtMeeting to be held at 2.00 p.m. on the same day and at the same place (or its adjournment thereof),for the purpose of considering and, if thought fit, passing with or without any modifications, the followingresolution:

Special ResolutionProposed Capital Distribution

That contingent upon the approval of the Scheme by Scheme Shareholders at the Court Meeting:

1. Pursuant to Article 55 of the Articles of Association of the Company and Section 78A read withSection 78G of the Companies Act:

(a) the issued share capital of the Company be reduced from approximately US$134,217,000to approximately US$81,617,000 or such higher amount remaining after cancelling theamount required to effect the Capital Distribution; and

(b) from the credit of up to US$52,600,000 arising out of the foregoing cancellation of capital,approval be and is hereby given to the Company to make a distribution of US$0.24 in cashfor each Share held by or on behalf of the Scheme Shareholders,

(the “Capital Distribution”).

2. The Directors and each of them be and are hereby authorised to do all acts and things and toexecute all such documents as they or he may consider necessary or expedient to give effect tothe Capital Distribution with such modifications thereto, if any, as they or he shall think fit in theinterests of the Company.

3. In this Resolution:

“Companies Act” means the Companies Act, Chapter 50 of Singapore.

“Court Meeting” means the meeting of Scheme Shareholders to be convened and held under thedirections of the High Court of the Republic of Singapore for the purpose of considering, and ifthought fit, approving the Scheme.

“Scheme” means the proposed acquisition by Dimension Data Holdings plc of all the issuedshares of the Company held by Scheme Shareholders by way of a scheme of arrangement underSection 210 of the Companies Act.

“Scheme Shareholder” means persons who are registered as holders of Shares in the Registerof Members of the Company other than Dimension Data Holdings plc, its related corporations (assuch term is defined in Section 6 of the Companies Act) and their respective nominees, exceptthat where the registered holder is The Central Depository (Pte) Limited (“CDP”), such personsshall mean the Depositors who have Shares credited to their securities accounts.


239

“Share” means issued ordinary share in the capital of the Company.

By Order of the Board

Sandy Foo Fei YingCompany Secretary22 September 2008

Notes:

(a) Every Shareholder entitled to attend and vote at the Extraordinary General Meeting is entitled to appoint not more than twoproxies to attend and vote on his/her behalf. A proxy need not be a member of the Company.

(b) The instrument appointing the proxy that has been executed by a Shareholder must be lodged at the registered office of theCompany at 6 Temasek Boulevard, #26-01/05 Suntec Tower Four, Singapore 038986 not less than forty-eight (48) hoursbefore the time appointed for the Extraordinary General Meeting or any adjournment thereof. Detailed instructions are setout in the Proxy Form.


240



FORM OF PROXY FOR USEAT THE COURT MEETING OF SCHEME SHAREHOLDERS

(OR AT ANY ADJOURNMENT THEREOF)


Originating Summons )Number 1164 of 2008/T ) In the matter of

Datacraft Asia Ltd(Company Registration No. 199301842Z)

And

In the matter ofSection 210 of the Companies Act, Chapter 50



Between

Datacraft Asia Ltd

Scheme Shareholders

And


*I/We NRIC/Passport No.

of

being a *Scheme Shareholder/Scheme Shareholders of Datacraft Asia Ltd, hereby appoint:

Name Address NRIC/Passport No.Total Number of

Shares Held

or failing him, the Chairman of the Court Meeting of Scheme Shareholders convened on the directions of theHigh Court of Singapore as my/our proxy/proxies, to attend and vote for *me/us on *my/our behalf and, ifnecessary, to demand a poll, at the Court Meeting of the Scheme Shareholders to be held at Conrad CentennialSingapore, 2 Temasek Boulevard, Singapore 038982 on 15 October 2008 at 2.00 p.m. and at any adjournmentthereof.

*I/We direct *my/our proxy to vote for or against the Resolution to be proposed at the Court Meeting of SchemeShareholders as indicated below. In the absence of specific directions, the proxy will vote or abstain as he maythink fit, as he will on any other matter arising at the Court Meeting of Scheme Shareholders. The authorityincludes the right to demand or to join in demanding a poll and to vote on a poll.

Resolution For Against

Approval of the Scheme of Arrangement

If you wish to exercise all your votes “For” or “Against”, please tick (�) within the box provided. Otherwise pleaseindicate the number of votes as appropriate.

Dated this day of 2008

Signature(s) of Scheme Shareholder(s)/Common Seal

*Delete accordingly


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Notes:

1. All capitalised terms used herein and defined in the Notice of Court Meeting of Scheme Shareholders shall, unless otherwisedefined herein, bear the respective meanings ascribed thereto in the said Notice of Court Meeting of Scheme Shareholders.

2. In the space provided for “Total Number of Shares Held”, please write the total number of Shares held by you. If you haveShares registered in your name in the Register of Members of the Company, you should insert that number of Shares. If nonumber is inserted, this form of proxy or proxies will be deemed to relate to all the Shares held by you.

3. A Scheme Shareholder entitled to attend and vote at the Court Meeting of Scheme Shareholders is entitled to appoint notmore than one proxy to attend and vote on his behalf. A proxy need not be a Scheme Shareholder. If however,notwithstanding the completion and lodgement of the Proxy Form by the Scheme Shareholder, the Scheme Shareholderattends the Court Meeting of Scheme Shareholders in person, the Proxy Form submitted by that Scheme Shareholder shallbe rendered null and void by such attendance.

4. To be effective, the instrument appointing a proxy (or representative) must be deposited at 6 Temasek Boulevard, #26-01/05Suntec Tower Four, Singapore 038986, not less than forty-eight (48) hours before the time appointed for holding the abovemeeting. If Proxy Forms for the Court Meeting are not so lodged, they may be handed to the Chairman of the Court Meetingat the Court Meeting.

5. The instrument appointing a proxy must be under the hand of the appointer or of his attorney duly authorised in writing.Where the instrument appointing a proxy is executed by a corporation, it must be executed either under its common sealor under the hand of its duly authorised officer or attorney.

6. Where an instrument appointing a proxy is signed on behalf of the appointer by an attorney, the power of attorney (or otherauthority) or a duly certified copy thereof must (failing previous registration with the Company) be lodged with the instrumentof proxy, failing which the instrument may be treated as invalid.

7. A corporation which is a Scheme Shareholder may authorise, by resolution of its directors or other governing body, suchperson as it thinks fit to act as its representative at the above meeting, in accordance with Section 179 of the CompaniesAct, Chapter 50 of Singapore.

8. The Company shall be entitled to reject the instrument of proxy which is incomplete, improperly completed, illegible or wherethe true intentions of the appointer are not ascertainable from the instructions of the appointer specified on the instrumentof proxy or proxies.




FORM OF PROXY FOR USE AT THE EXTRAORDINARY GENERAL MEETING(OR AT ANY ADJOURNMENT THEREOF)

*I/We NRIC/Passport No.

of

being a *Scheme Shareholder/Scheme Shareholders of Datacraft Asia Ltd, hereby appoint:

Name Address NRIC/Passport No.

Proportion of Shareholdings

No. of Shares (%)

and/or*

Name Address NRIC/Passport No.

Proportion of Shareholdings

No. of Shares (%)

or failing him/them*, the Chairman of the Extraordinary General Meeting as my/our proxy/proxies, toattend and vote for *me/us on *my/our behalf and, if necessary, to demand a poll, at the ExtraordinaryGeneral Meeting to be held at Conrad Centennial Singapore, 2 Temasek Boulevard, Singapore 038982on 15 October 2008 at 2.30 p.m. (or as soon as the Court Meeting (respectively defined in the Scheme)convened at the direction of the High Court of Singapore for the same day and at the same place shallhave concluded or been adjourned) for the purpose of considering and, if thought fit, passing (with orwithout modification) the Special Resolution referred to in the notice convening the said Meeting, andat such Meeting (or at any adjournment thereof) to vote for me/us and in my/our name(s) in respect ofthe said Special Resolution as indicated below and at any adjournment thereof.

*I/We direct *my/our *proxy/proxies to vote for or against the Special Resolution to be proposed at theExtraordinary General Meeting as indicated below. In the absence of specific directions, the*proxy/proxies will vote or abstain as *he/they may think fit, as *he/they will on any other matter arisingat the Extraordinary General Meeting. The authority includes the right to demand or to join indemanding a poll and to vote on a poll.

Special Resolution For Against

Approval of the Proposed Capital Distribution

If you wish to exercise all your votes “For” or “Against”, please tick (�) within the box provided.Otherwise please indicate the number of votes as appropriate.

Dated this day of 2008

Total number of Shares held

Signature(s) of Scheme Shareholder(s)/Common Seal

*Delete accordingly


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Notes:

1. All capitalised terms used herein and defined in the Notice of Extraordinary General Meeting shall, unless otherwise definedherein, bear the respective meanings ascribed thereto in the said Notice of Extraordinary General Meeting.

2. In the space provided for “Total Number of Shares Held”, please write the total number of Shares held by you. If you haveShares registered in your name in the Register of Members of the Company, you should insert that number of Shares. If nonumber is inserted, this form of proxy or proxies will be deemed to relate to all the Shares held by you.

3. A Shareholder entitled to attend and vote at the Extraordinary General Meeting is entitled to appoint not more than twoproxies to attend and vote on his behalf. A proxy need not be a Shareholder. If however, notwithstanding the completion andlodgement of the Proxy Form by the Shareholder, the Shareholder attends the Extraordinary General Meeting in person, theProxy Form submitted by that Shareholder shall be rendered null and void by such attendance.

4. To be effective, the instrument appointing a proxy (or representative) or proxies must be deposited at 6 Temasek Boulevard,#26-01/05 Suntec Tower Four, Singapore 038986, not less than forty-eight (48) hours before the time appointed for holdingthe above meeting.

5. Where a member appoints more than one proxy, he shall specify the proportion of his shareholding to be represented byeach proxy. If no such proportion or number is specified, the first named proxy may be treated as representing 100% of theshareholding and any second named proxy is an alternate to the first named.

6. The instrument appointing a proxy or proxies must be under the hand of the appointer or of his attorney duly authorised inwriting. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either underits common seal or under the hand of its duly authorised officer or attorney.

7. Where an instrument appointing a proxy is signed on behalf of the appointer by an attorney, the power of attorney (or otherauthority) or a duly certified copy thereof must (failing previous registration with the Company) be lodged with the instrumentof proxy, failing which the instrument may be treated as invalid.

8. A corporation which is a Shareholder may authorise, by resolution of its directors or other governing body, such person asit thinks fit to act as its representative at the above meeting, in accordance with Section 179 of the Companies Act, Chapter50 of Singapore.

9. The Company shall be entitled to reject the instrument of proxy which is incomplete, improperly completed, illegible or wherethe true intentions of the appointer are not ascertainable from the instructions of the appointer specified on the instrumentof proxy or proxies.


datacraft asia ltd dimension data holdings plc · 2008-09-22 · document dated 22 september 2008...

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