LDC London Asia

RNS Number:2207X
London Asia Capital PLC
25 May 2007


25 May 2007


                            London Asia Capital plc

                         Creation of Property Division


London Asia Capital plc ("London Asia" or "the Group") the UK listed (AIM:
LDC.L) Asia focused merchant banking group, has invested in a new company,
London Asia Capital Land Limited ("LACL"), to focus on investment in distressed
property situations in Greater China.

LACL, incorporated in Hong Kong, has an initial start-up capital of HK$100
million (#6.5 million). It will focus on transactions in the property sector,
primarily distressed assets where banks and finance houses have called in the
finance, developers have run out of money, and similar situations. The focus
will be on a broad spectrum of residential and commercial properties, including
hotels, business parks, and wind farms, and complete as well as part developed
and green field sites.

Transactions will be identified through London Asia's network in China,
including the recently announced stake in the Chinese auction house, responsible
for disposing of distressed property assets, among other things. It will also
seek to leverage the Group's relationships with China Synergy, the Beijing
headquartered real estate brokerage, and China Real Estate Services Ltd
("CRES"), the Beijing headquartered real estate chain in which the London Asia
Chinese Private Equity Fund has a stake. CRES recently re-branded its 30 high
street offices in northern China as London Asia Homes.

London Asia will own 40% of LACL and the remaining 60% will be owned by LACL's
management team and their associates, headed by Ms Liew. London Asia is paying
for its 40% stake by the issue to LACL of 21,505,376 ordinary 5p shares in
London Asia at an effective price of 12p per London Asia share. Application will
be made to admit the new shares issued by London Asia to trading on AIM, with
admission expected on 1 June 2007.

Simon Littlewood, London Asia Chief Executive, said: "This new venture seeks to
capitalize on the Group's existing investments and relationships in the real
estate sector. As London Asia increases in size, there is increasing synergy
between our various businesses and investments.

"Recent controls imposed by the Chinese Government to cool the property market
have created a number of opportunities for financiers in the sector, which
warrant the creation of a specialist division and team, with their own balance
sheet to leverage off.

"This week London Asia has invested in three new enterprises to generate
additional revenue for the business, each with their own #6.5 million balance
sheets, totaling over #19 million of gross assets, and adding over #7.7 million
of assets to the Group's balance sheet. These companies have already begun to
trade and generate profits for the Group."



For further information please visit www.londonasia.com or contact:


Simon Littlewood             John West/Andrew Dunn         Jonathan Wright
London Asia Capital plc      Tavistock Communications      Seymour Pierce
Tel: Tel 020 7231 0282       Tel: 020 7920 3150            Tel: 020 7107 8000




                      This information is provided by RNS
            The company news service from the London Stock Exchange

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