The leading international sportswear brand enterprise in the PRC, China Dongxiang (Group) Co., Ltd. ("China Dongxiang" or "the Company"; stock code: 3818, together with its subsidiaries the "Group") is pleased to announce that it has entered into an agreement with Michael Michalsky, the former global creative director of Adidas, for the development and launch of a new collection under the Kappa brand.

This is an unprecedented collaboration between the Kappa brand and a distinguished fashion designer to launch a cross-over collection which includes sportswear, accessories and footwear products. These products will be sold exclusively at Kappa stores in the PRC.

    Mr. Michael Michalsky is considered one of the most influential German designers for the international fashion and life-style industry. Starting out his career as a design manager at Levis where he was soon appointed chief designer, he joined Adidas in 1995 and was the head of design at Adidas until 2006. Together with Mr. Yohji Yamamoto, Mr. Michalsky developed the upmarket street-fashion line Y-3. He also established collaborations with fashion- celebrity Stella McCartney and Hip-Hop superstar Missy Elliot which were all three a tremendous success during his stay in Adidas. He later set up his own fashion label MICHALSKY and M-67 in 2006 and constantly collaborates with international brands such as MCM, Audi, Walt Disney in a number of cross-over design projects.

    Mr. Chen Yihong, Chairman of China Dongxiang is excited about this cooperation which marked a major step in further strengthening China Dongxiang's position as the leading fashion sportswear brand in China. "Mr. Michalsy is famous for his highly creative and unique capability in fashion design which aims at modern and cosmopolitan consumers. His strengths perfectly fit in with the positioning of Kappa brand combining elements of 'fashion and sport'. The win-win cooperation will surely bring new inspirations to our product R&D and will further enhance our product designs and quality in the long run. I am confident that the new collection by Mr. Michalsky to be launched at our Kappa store will be a great success," Mr. Chen concluded.

    About China Dongxiang (Group) Co., Ltd.

    China Dongxiang (Group) Co., Ltd. is a leading international sportswear brand enterprise based in China and was successfully listed on the Stock Exchange of Hong Kong Limited on 10 Oct, 2007. The Group is primarily engaged in the design, development, marketing and wholesale of branded sportswear in China. Currently, China Dongxiang owns all rights to the internationally recognized Kappa Brand in China, Macau and Japan. Its products convey an active, fashionable and youthful image and are warmly welcomed by China's fast growing and high potential consumers. The Group finished its acquisition of a Japan sportswear enterprise Phenix on 30 April 2008. The international brand "Phenix" has the greatest market share in the skiing and outdoor sportswear market in Japan.