[Hong Kong, 3 October 2005] AS Watson, the retail and manufacturing division of Hutchison Whampoa Limited (HWL), today announced its acquisition of St. Petersburg based Russian health and beauty retail chain, Spektr Group. This acquisition marks an extension of AS Watson Group's retail network into Russia, the sixth largest economy in the world in terms of PPP (Purchase Power Parity)¹. The addition of Spektr further strengthens AS Watson Group's position as the world's largest health and beauty retailer.

Spektr Group was established in 1990 and is the market leader in health and beauty retail in St. Petersburg. It operates 24 outlets in St. Petersburg with more than 500 employees, offering a comprehensive range of personal care, skincare, perfumery and cosmetics, and household products of local and international brands.

Ian Wade, AS Watson Group Managing Director said, "Russia has an increasingly stabilised political environment and shows continuous growth in GDP and consumer spending power. Its retail market has grown rapidly in recent years and the demand for health and beauty presents strong potential. The acquisition of Spektr Group is in line with our long-term strategy to expand in Eastern Europe, and helps us to establish our footprint in Russia."

Mr Vladimir Ilin and Mrs Tatiana Ilina, owners of Spektr Group, are very happy to become part of the AS Watson Group, "We are very positive about joining AS Watson. This is the right step forward for the Spektr chain. Such a move will also create more opportunities for Spektr's personnel." Both the Ilins will remain with AS Watson. Mr Ilin has been appointed the General Director while Mrs Ilina will be the Commercial Director.

Russia, with a population of more than 144 million, is one of the major emerging economies. Its retail sector is expected to report double digit growth in the next few years including an estimate of 15% increase of retail sales in 2005.²

AS Watson will take over the Specktr operation in the next few months. Following the completion, AS Watson will further develop the Spektr operations and integrate the chain into AS Watson's global operations of its current 17 retail brands. The existing management of Spektr will continue to run the operations on a day-to-day basis with additional resources and international expertise injected by AS Watson Group.

First Watsons store in Estonia

Meanwhile, AS Watson will open its first store in Tallinn, Estonia in mid-October. This marks the Group's first entry into the country, and extends the Group's global reach to 34 markets.

Notes to Editors

AS Watson Group is the largest health & beauty retailer in the world. With a history dating back to 1828, ASW has evolved into an international retail and manufacturing corporation with operations in 33 markets worldwide.

Today, the Group operates over 6,800 retail stores running the gamut from health & beauty, luxury perfumeries & cosmetics to food, electronics, fine wine and airport retail arms. Also an established player in the beverage industry, AS Watson provides a full range of beverages from bottled water, fruit juices, soft drinks and tea products to the world's finest wine labels via its international wine wholesaler and distributor. AS Watson employs over 88,000 staff and is a member of the world renowned Hong Kong-based conglomerate Hutchison Whampoa Limited, which has major interests in ports and related services, telecommunications, property and hotels, retail and manufacturing, and energy and infrastructure with businesses in 51 countries.

¹ Source: Ernst & Young
² Source: AT Kearney, Euromonitor 2005