CathayOnline Announces Closing Initial Financing Project in the United States.

Business Editors

NEW YORK--(BUSINESS WIRE)--April 17, 2000

CathayOnline Inc. (OTC BB:CAOL) is pleased to announce that it has completed a private placement of $6,820,000 of Units, each consisting of one share of common stock and one redeemable common stock purchase warrant.

The Company sold an aggregate of 9,742,860 Units at a price of $0.70 per Unit.

Each warrant entitles the holder to purchase one share of common stock, at a price of $0.77 per share, up to three years after the date of issuance of the Units.

"The seven million in financing will allow us to continue the aggressive growth program in the new Millennium that we embarked upon in 1999," said Brian Ransom, president of CathayOnline. "We will use these funds to establish and implement joint ventures, advance the pace of strategic acquisitions and increase our market share in the Internet and electronic mail industries in China. These funds will permit us to expand advanced communications portals, and move forward with the enhancement of our online content providers within the Chinese speaking world."

CathayOnline is among the leading fully diversified Internet companies in Asia. The Company has made the Chinese speaking market, with particular emphasis on the People's Republic of China, its principal focus. The PRC represents the largest potential source of connectivity for business and advanced communication services via e-mail. The International Data Corporation (IDC) forecasts that China's Internet population will grow at a rate of 54% per year to 33 million users in 2004. According to a recent China Internet Network Information Center (CNNIC) report, China's Internet population was 8.9 million at the end of 1999 up from 4 million six months previous. CNNIC also estimates there are currently more than 35 million e-mail accounts in the PRC today.

CathayOnline maintains its corporate offices in Beijing, and its technical office in Chengdu, the capital city of the Sichuan Province in southwestern China. According to ChinaDaily, Beijing, Guangdong and Shanghai lead the country in the number of Internet users followed by Chengdu and Chongqing in the western regions of China. The Company has established a solid foundation from which to provide fast and reliable Internet connectivity, interest-specific original content and a suite of value-added Internet communication services including Web based e-mail and advanced Web messaging services, to the largest and one of the fastest growing markets in the world.

CathayOnline will continue its goal in extending its branded connectivity, communications and content to China's most dynamic and high growth urban markets, in particular Beijing, Guangdong and Sichuan Provinces, and capturing a major share of the potential 1.4 billion Chinese speaking community. The Company plans to foster long-range growth through strategic joint ventures, aggressive marketing and exceptional customer service. More information regarding CathayOnline can be obtained by visiting www.cathayonline.com.

CathayOnline Inc.

For further information contact Sheila Bennett of CathayOnline at the Vancouver office 604/687-8381.

Statements included in this press release which are not historical in nature, are intended to be, and are hereby identified as "forward-looking statements" for purposes of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended by Public Law 104-67. Forward-looking statements may be identified by words including "anticipate", "believe," "intends," "estimates," "expect," and similar expressions. The Company cautions readers that forward-looking statements, including without limitation, those relating to the Company's future business prospects are subject to certain risks and uncertainties that could cause actual results to differ materially from those indicated in the forward-looking statements.