ASPAC Communications Inc. Completes $4.5M Private Placement.

Business Editors & High Tech Writers

TORRANCE, Calif.--(BUSINESS WIRE)--May 15, 2000

ASPAC Communications Inc. (OTCBB:ACMN), a development stage company positioning itself, through its YeeYoo.net joint venture, to be the first Internet Service Provider (ISP) offering broadband interactive communications and online services in the People's Republic of China (PRC), announced today that it has completed a private placement offering of $4.5 million.

The fund will be used for the company's joint venture development to offer broadband communication and online services in the PRC and general corporate purposes.

The major investor of this offering is Singapore based venture capital firm, Discovery Times Ltd., whose shareholders include global high-tech companies in the computer and telecommunication industry.

About ASPAC Communications Inc.

ASPAC is currently actively engaged in the development of wireless broadband interactive communication and online services in the People's Republic of China (PRC) through its joint venture subsidiary YeeYoo.net (YeeYoo).

The joint venture agreement was reached with China Education and Research Network (CERNET) and Beijing Sino-Tech Science and Technology Development Center (SINOTECH). The combination of CERNET and SINOTECH will provide the joint venture with access to over 20k kilometers of nationwide fiber backbone and operation services, reaching 35 major cities or over hundreds of millions of potential clients in the PRC.

Using the state-of-art point-to-multipoint wireless cable technology as the "last-mile" solution, YeeYoo plans to offer high-speed Internet connections to schools and business customers throughout the PRC.

The company believes that wireless strategy has proven to be more efficient and effective than the traditional landline approach in a developing country like the PRC, where the growth of wireless telephones has significantly outpaced the growth of its landline counterparts.

The Internet market of the PRC has grown almost 50-fold in the last 5 years. High-speed connectivity however is practically non-existent to the general public. The broadband wireless cable technology allows the company to deliver Internet access at speeds up to 300 times faster than the conventional modem.

The technology closely resembles the advanced technology known as Multichannel Multipoint Distribution System (MMDS) being deployed in the United States. It provides the company with significant superiority in capital cost, speed, and flexibility of deployment that are crucial in a difficult market such as China.

In addition, the service is delivered without the need of local telephone line and without expensive local phone charges, thus more savings are passed on to customers for even greater competitiveness.

The primary commercial targets of ASPAC are businesses and schools. Initial deployment of the service is expected in six to nine months.

Major shareholders of ASPAC consist of global high-tech companies, Tianxin Chinsi, a communication technology development company under the Ministry of Aerospace of China, and CERNET under the Ministry of Education of China.

The current regulations of China prohibit foreign investment from majority ownership in the telecommunication industry. It is anticipated that the Chinese government will gradually open up and deregulate its telecommunication market. The Chinese government has stated recently that it intends to promulgate new laws or regulations governing foreign investment in the PRC Internet sector in the near future. China's potential entry into the World Trade Organization will likely affect the terms of any new laws and regulations to be enacted. The company will restructure its capital participation in its YeeYoo joint venture to suit the new laws and regulations once they are adopted. At this time, the company does not know the timing or terms of these new laws or regulations and it is difficult to predict whether the new laws and regulations will have a negative impact on the company and its business operation and the extent of such impact. Potential investors should be aware of the economic and political risks involved in doing business in China, which could adversely affect the company and its financial outcomes.

Except for historical financial information that may be contained herein, the matters set forth in this release are forward-looking statements that are dependent on certain risks and uncertainties, including but not limited to such factors as market demand, pricing, and changes in worldwide economic conditions.