Kawan Food Berhad wishes to announce that the Company has on 24 December 2008 incorporated a wholly-owned subsidiary company, Kawan Food (Hong Kong) Limited under the Hong Kong Companies Ordinance (Chapter 32). The certificate of incorporation of Kawan Food (Hong Kong) Limited was received by Kawan on 30 December 2008.

The authorized capital of Kawan Food (Hong Kong) Limited is USD200.00 comprising 200 shares of USD1.00 each, of which the issued and paid-up share capital will be USD1.00 divided into 1 share of USD1.00 each. The principal activity of Kawan Food (Hong Kong) Limited is trading of pastry products.

The said incorporation of Kawan Food (Hong Kong) Limited will not have any effect on the share capital and substantial shareholders’shareholdings of Kawan and is not expected to have a material effect on the net assets, earnings and gearing of the Kawan’s Group for the financial year ending 31st December 2008.

Save for Madam Kwan Sok Kay who is the first Director of Kawan Food (Hong Kong) Limited, none of the Directors and/or substantial shareholders of Kawan and/or persons connected with them have any interest, direct or indirect, in the above incorporation.

This announcement is dated 31 December 2008.