DUPD.L Regulatory News (DUPD)

Replacement for the announcement released on 24 December 2013

16 January 2014

Dragon-Ukrainian Properties & Development PLC

("DUPD" or the "Company")

Update re investment in Henryland Group Limited

Dragon-Ukrainian Properties & Development plc ("DUPD") is providing an update on its investment in Henryland Group Limited ("Henryland"). Henryland is owned 38% by DUPD and 62% by Dragon Capital Investments Limited, an affiliate of DUPD's investment manager, Dragon Capital Partners Limited ("DCP"). Henryland owned six "big box" retail schemes in regions of Ukraine, of which three are fully operational and cash-generating.

DUPD's carrying value for its investment in Henryland was $11.721 million at 30 June 2013.

DUPD has been informed by DCP that an affiliate of DCP sold its shareholding in the principal tenant of the three operational schemes owned by Henryland, Nova Liniya, to an unrelated third party. Subsequent to this, DCP has advised DUPD that the board of Henryland has entered into an agreement with an unrelated third party to sell its six big box schemes for a consideration of ca. $23.7 million. The transaction is expected to complete by end of 2014 when all assets are transferred, but Henryland has already received an initial instalment of the consideration, totalling c.$14.053 million. Immediately following the receipt of the instalment, the board of Henryland approved payment of dividends in the amount of $13.825m to its shareholders, of which DUPD has already received $5.253m.

The disposal proceeds represent a 23.3% discount to the 30 June 2013 carrying value of Henryland's net assets transferred, which at 30 June 2013 were $30.908 million. The disposal of Henryland's investment properties and payment of dividends will decrease DUPD's carrying value for its investment in Henryland by $8.05 million to approximately $3.65 million.

Following the completion of the disposal of the six properties, Henryland will no longer own any investment properties or other assets and is not intending to conduct any active business operations.

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