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August 2007

ST Electronics To Divest Shares In Associated Company, ECS Holdings Limited

Singapore, 8 August 2007 — Singapore Technologies Electronics Limited (ST Electronics) today announced its subsidiary, ST Electronics (Info-Software Systems) Pte. Ltd. (STEE-InfoSoft), together with certain other vendors (Other Vendors) have entered into a conditional Sale and Purchase Agreement (Agreement) with VST Holdings Limited (VST or the Purchaser). Under the Agreement, STEE-InfoSoft has agreed to sell its 75,840,978 ordinary shares (ECS Shares) in the capital of its associated company, ECS Holdings Limited (ECS), to VST. This represents 20.77% of ECS’ issued share capital. The ECS Shares will be sold to VST at a sale price of S$0.668 per share, for an aggregate cash consideration of S$50.7m (Aggregate Consideration). The sale price of the ECS Shares was arrived at on an arm’s length basis. ST Electronics is the electronics arm of Singapore Technologies Engineering Ltd (ST Engineering).

The sale of the ECS Shares is not expected to have any material impact on the consolidated net tangible assets per share and earnings per share of ST Engineering for the current financial year.

STEE-InfoSoft invested in ECS in September 2004 and the cost of investment in ECS was S$24.8m. The market value of the ECS Shares based on the closing price of the ECS Shares on the Singapore Exchange Securities Trading Limited on 3 August 2007 was S$47.8m.

Over the past three years, the investment in ECS had provided good access to additional capabilities and a marketing and distribution channel to offer the group’s information technology solutions to customers in Singapore and other regional markets. This sale of ECS shares presents an opportunity to maximise shareholders’ value for STEE-InfoSoft.

Completion of the sale and purchase of the ECS Shares is conditional upon the fulfillment or waiver of certain conditions precedent, which include the following:

The Stock Exchange of Hong Kong Limited (SEHK) having confirmed to the Purchaser that it has no comments on the circular relating to the Agreement to be despatched to the shareholders of the Purchaser for approving the same as a very substantial acquisition pursuant to Chapter 14 of the Rules Governing the Listing of Securities on the SEHK;
the passing of a resolution by the shareholders of the Purchaser approving the transactions contemplated by the Agreement and the acquisition of all the remaining ordinary shares of ECS by way of a mandatory general offer to be made following completion of the sale and purchase of the ECS Shares and the ordinary shares held by the Other Vendors (Completion); and
the aggregate number of ordinary shares of ECS being sold to the Purchaser by STEE-InfoSoft and the Other Vendors under the Agreement amounting to not less than 30.1% of the issued ordinary shares of ECS (assuming that all options under the ECS Share Option Scheme II held by persons other than the Other Vendors have been exercised in full).

Pursuant to the Agreement, the Purchaser has agreed to pay a deposit (Deposit) of 10% of the Aggregate Consideration to an escrow agent. The Deposit will be applied towards payment of the Aggregate Consideration on the completion of sale and purchase of the ECS Shares.

ST Electronics (Info-Software Systems) Pte Ltd, a wholly owned subsidiary of ST Electronics, has 20 years of experience in designing, implementing and supporting mission critical Command, Control & Intelligence (C2I) systems including C2 simulation. Using its Common Application Platform (CAP) and dual use technology, it delivers Homeland Security systems and e-Government services and solutions. Its e-Government implementations comprise managed services and turnkey solutions. Based on its Service Transformation™ framework, the company delivers premier quality solutions and services, in turn enabling its customers to better serve their customers.

ST Electronics, the electronics arm of ST Engineering, delivers innovative system solutions to government, commercial, defence, and industrial customers worldwide. It specialises in the design, development and integration of advanced electronics systems, such as broadband radio frequency and satellite communication, e-government solutions, information communications technologies, rail and traffic management, realtime command & control, training and simulation, intelligent building management, information security solutions and managed services. Please visit www.stee.stengg.com.

ST Engineering is an integrated engineering group providing solutions and services in the aerospace, electronics, land systems and marine sectors. Headquartered in Singapore, the Group reported revenues of $4.49b in FY2006. With a market capitalisation of over $10b, it ranks among the largest companies listed on the Singapore Exchange. ST Engineering has more than 17,000 employees worldwide, and over 100 subsidiaries and associated companies in 20 countries and 35 cities. Please visit www.stengg.com.

Media contact:

Magdalen Loh
AVP / Head, Corporate Communications
Singapore Technologies Electronics Limited
Tel: (65) 6413 1788 / 9822 3321
Fax: (65) 6484 8840
Email: magloh@stee.stengg.com