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History

Our Company was established by our Chief Executive Officer, Mr John Chuang in 1984. Our Group was formed through a series of restructurings and acquisitions including that of PT Perusahaan Industri Ceres (established in 1950) and PT General Food Industries (established in 1969). PT Perusahaan Industri Ceres has been involved in the Indonesian chocolate confectionery industry for over 50 years and has, for many years, been a leader in Indonesian chocolate confectionery products ranging from chocolate bars to dragees. We have grown through a series of acquisitions and investments to become one of the world's major manufacturers of cocoa ingredients under the "Delfi" brand. In 1987, we commenced distributing third party brands in Indonesia taking advantage of our extensive distribution network in Indonesia, which we extended to Singapore thereafter.

Our international expansion began in 1988 and was driven by demand for our cocoa ingredients in certain markets. We built on our existing cocoa processing facility in Bandung, Indonesia, and established cocoa processing plants in Chachoengsao province, Thailand and Bulacan in the Philippines. We continued our international expansion with the construction of a new cocoa processing plant in Johor, Malaysia, which was completed in mid-2003 and through the purchase of cocoa processing plants in Mexico City, Mexico and Bahia, Brazil in the second half of 2003.

In addition to growth through acquisitions and investments, we have focussed on growing through partnerships with established businesses that complement our own. In 2001, we formed a joint venture company with Meiji Seika Kaisha, Ltd. of Japan to manufacture "Meiji" branded confectionery and biscuits in Indonesia. The joint venture brought together Meiji's well-established brands and technological expertise in biscuits and our chocolate manufacturing and distribution capability, and increased our range of consumer products targeted at younger consumers in Indonesia.

In June 2002, we established a joint venture with SD Holdings Berhad (a Sime Darby company in Malaysia) by taking a 60% stake in its subsidiary, Ceres Sime Confectionery Sdn Bhd, which owns a chocolate confectionery factory in Klang, Malaysia. This investment was part of our strategy to increase our presence in Malaysia. In July 2003, the Company also acquired a 100% shareholding interest in Ceres Sime Marketing Sdn Bhd through Ceres Sime Confectionery Sdn Bhd, to enhance our distribution capability in Malaysia and to complement Ceres Sime Confectionery Sdn Bhd's operations.

On 26 May 2003, the Company entered into an agreement with Nestlé Mexico S.A. De C.V. ("Nestlé Mexico") in which Nestlé Mexico agreed to sell and the Company agreed to buy Nestlé Mexico's factory and equipment used for the production of cocoa butter, liquor and powder in Mexico. The sale and purchase agreement was conditional upon the parties entering into a supply agreement for the supply by the Company to Nestlé of cocoa butter, liquor and powder to be manufactured by the Company in the same factory. The supply agreement was entered into on the same date as the sale and purchase agreement.

On 20 August 2003 the Company entered into an agreement with Nestlé S/A, and Nestlé Brasil Ltda. (as intervening guarantor) (subsequently amended by the Amendment to the Stock Purchase Agreement dated 1 October 2003), in which the Company agreed to buy the shares of Alpha Cacao Brasil Ltda. ("Alpha"), the Nestlé company in charge of the production of cocoa butter, liquor and powder in Brazil. Nestlé S/A transferred 100% of the share capital of Alpha to Delfi Cocoa Brazil Participaçöes Ltda., which then merged with Alpha to become Delfi Cacau Brasil Ltda. On the same date that the Company entered into the agreement to buy the shares of Alpha, Nestlé Brasil Ltda ("Nestlé Brazil") and Alpha entered into an agreement for the supply by Alpha to Nestlé Brazil of cocoa butter, liquor and powder.

Our acquisitions of Nestlé's plants in Mexico and Brazil have also strengthened our relationship with Nestlé, as through these transactions, they have entered into arrangements to outsource their cocoa ingredients production in those countries to us.

As a result of these developments, our cocoa bean grind capacity has grown from approximately 54,000 mt in 1999 and 60,000 mt in 2000 to approximately 200,000 mt in 2003. Our cocoa processing plant in Johor was partly funded through institutional investment.