Hurray! to Acquire Major Interest in the Music Business of the Freeland Group, A Pioneer in Internet Music Production and Distribution

Hurray! to Acquire Major Interest in the Music Business of the Freeland Group, A Pioneer in Internet Music Production and Distribution

BEIJING, Nov. 14 /Xinhua-PRNewswire-FirstCall/ -- Hurray! Holding Co., Ltd. (NASDAQ:HRAY), a leading provider of advanced wireless value-added services and mobile telecommunication network software in the People's Republic of China, today announced the signing of definitive agreements to acquire a major interest in the music business ("Freeland Music") of the Freeland Group, which is a group of affiliated companies in China that is engaged in the production and distribution of audio and video media products. Freeland Music specializes in music production and distribution for its portfolio of artists which includes some of the most popular singers in China, such as Xiangxiang, Yang Chengang and Yang Yi. Many songs produced by Freeland Music and its artists, such as "Zhu Zhi Ge (Song of Pigs), " "Lao Shu Ai Da Mi (Mice Love Rice)," "Mei Er Ai Wo (Girl Love Me)," and "Hui Lai Wo De Ai (Come Back My Love),'' are not only top hits in ringtones, ring-back tones and digital downloads on mobile phones and the Internet in China, but also appeared in Top 20 World list of Apple Computer's iTunes services for the month of October 2005.

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In the acquisition, Freeland group will inject the music business into a newly formed company ("Hurray! Freeland"), which upon the closing of the acquisition will be 60% owned by Hurray! and 40% owned by Freeland group. The total consideration for the acquisition is US$7,560,000 in cash. Consideration payable by Hurray! and the respective ownership interests of the parties in Hurray! Freeland are subject to adjustment based on the financial performance of Hurray! Freeland following the closing of the acquisition. The transaction is expected to be accretive to Hurray!' earnings per share in 2006.

Hurray! currently expects the transaction to close before December 31, 2005, subject to required China regulatory approval and other customary closing conditions. Upon closing, pursuant to certain contractual arrangements, Hurray! will distribute Hurray! Freeland's music via wireless and Internet platforms, and Freeland group will distribute such music via offline channels, such as music stores.

Commenting on this acquisition, QD Wang, Chairman and Chief Executive Officer of Hurray!, said, "We are very pleased to announce this strategic partnership with Freeland group, a pioneer and leader in Internet as well as traditional music production and distribution in China. This will give us significant depth and breadth in music content and music production capabilities. It is a defining step for Hurray! in transforming into a leading digital music production and distribution house in China."

"This event marks the first time in China that a leading music production house joins hands with a leading digital music distribution company. Together, we will strive to redefine the music industry in China. We are thrilled to partner Hurray! in this endeavor," added Xiongbing Zhong, Chairman and Chief Executive Officer of Freeland group companies and to-be-established Hurray! Freeland.

China eCapital served as financial advisor to Hurray! in the transaction.

About Hurray! Holding Co., Ltd.

Hurray! provides wireless value-added services such as ringtones, picture downloads, community and entertainment services to mobile users in China. The company is one of the market leaders in providing these services using wireless application protocol, commonly referred to as WAP, in China. WAP services are offered through the advanced 2.5G mobile networks, the most advanced broadly available mobile networks deployed in China. Hurray! also offers these services through 2G mobile networks.

In addition, Hurray! designs, develops, sells and supports a service provisioning and management software that is used by China Unicom, one of the two principal mobile operators in China, to support its 2.5G services platform.

About Freeland Group

Freeland group engages in the production and distribution of audio and video media products in China. It is a pioneer in China in creating and promoting pop stars by distributing their music on the Internet in addition to through traditional channels. Many songs produced and promoted by Freeland for its artists such as Xiangxiang, Yang Chengang and Yang Yi are among the top hits in the markets of ringtones, ring-back tones and digital downloads on mobile phones and the Internet in China.

Forward-looking Statements

This press release contains statements of a forward-looking nature. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward- looking statements by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. The accuracy of these statements may be impacted by a number of business risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including: the risk that this or any future acquisition will not create the operational and financial results that Hurray!'s management and board of directors expects, including in particular the possibility that this acquisition may not be accretive to earnings in any future period or that Hurray! Freeland may not become a leading digital music production and distribution house in China; the risk that Hurray! will not be able to effectively manage Hurray! Freeland's artists or effectively utilize its library of music; the risk that this and any future acquisition could divert management's attention from Hurray!'s operations, which could adversely affect its results of operations; and the risks outlined in our filings with the Securities and Exchange Commission, including our registration statement on Form F-1. We do not undertake any obligation to update this forward-looking information, except as required under applicable law.

For more information, please contact:

Phoebe Meng
Investor Relations Manager
Tel: +86-10-6518-8989 x6806
Email: yfmeng@hurray.com.cn

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Source: Hurray! Holding Co., Ltd.

CONTACT: Phoebe Meng, Investor Relations Officer, +86-10-6518-8989 x6806
or email, yfmeng@hurray.com.cn

Web site: http://www.hurray.com/

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