1. INTRODUCTION

Pursuant to the rationalisation of the business of Europlus Berhad and Talam including the merger of their property related business, RM76,332,275.00 nominal value of 5-Year 1% Irredeemable Convertible Unsecured Loan Stock (“ICULS”) have been issued to the Company’s 99.999% subsidiary, Europlus Berhad (“EB”) by Venue Venture Sdn Bhd (“VVSB”) as part of the consideration for the acquisition of its recreation and leisure related business and investment properties. The ICULS will mature on 20 November 2008 (“Maturity Date”).

The Board of Directors of Talam wishes to inform that pursuant to the Trust Deed dated 3 November 2003 entered between VVSB and the Trustee of the holder of ICULS and upon the Maturity Date, VVSB shall compulsorily convert the 76,332,275 ICULS into 76,332,275 new ordinary shares of RM1.00 each of VVSB (“Conversion”) to EB which represents 99.65% in the share capital of VVSB.

Currently, EB holds 2 ordinary shares of RM1.00 each in VVSB. After the Conversion, EB will hold 76,332,277 ordinary shares of RM1.00 each representing 99.65% of the enlarged issued and paid-up share capital of VVSB whilst PB Trustee Services Berhad will hold 0.35% of the equity.

Upon Conversion, VVSB and its subsidiaries will become subsidiaries of Talam.

VVSB was incorporated on 9 November 2002 in Malaysia under the Companies Act, 1965 and having its registered office address at Suite 2.05, Level 2, Menara Maxisegar, Jalan Pandan Indah 4/2, Pandan Indah, 55100 Kuala Lumpur. The authorized share capital of VVSB is RM100,000,000 divided into 100,000,000 ordinary shares of RM1.00 each of which RM269,002 comprising 269,002 ordinary shares of RM1.00 each have been issued and fully paid-up. The principal activities of VVSB are property management and investment holdings.

VVSB has 3 subsidiaries namely, Bukit Khazanah Sdn Bhd (“BKSB”), Pandan Lake Club Berhad (“PLCB”) and Saujana Ukay Sdn Bhd (formerly known as Gemar Megaprima Sdn Bhd) (“SUSB”). The principal activities for BKSB are property development and investment, for PLCB is recreational club proprietor and SUSB is a dormant company.

VVSB owns unsold retail portions, two levels of carpark and a water theme park of a shopping complex known as Pandan Lagoon Shopping Complex and Water Theme Park erected on Lot 40819 of Ampang, District of Hulu Langat, Selangor. Whilst BKSB is the immediate holding company to PLCB, which is the recreational club proprietor for Pandan Lake Club located at Pandan Perdana, Cheras, Kuala Lumpur.

3.1 Share Capital

The Conversion will not have any effect on the issued and paid-up share capital of Talam.

3.2 Net Assets and Earnings

The Conversion is not expected to have any material effect on the net assets and earnings per share of Talam Group for the year ending 31 January 2009.