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MTC ELECTRONIC TECHNOLOGIES ENTERS SWAP AGREEMENT WITH CHINA CO.

 RICHMOND, British Columbia, May 3 /PRNewswire/ -- MTC Electronic Technologies Co. Ltd. (NASDAQ: MTCEF) announced today that it entered into a swap agreement with China Great Wall Industry Corporation, Shanghai Branch ("Great Wall-Shanghai") to exchange MTC's proposed 28 percent interest in a planned cellular telephone joint venture project in Shanghai for Great Wall-Shanghai's 50 percent interest in a planned joint venture in the city of Dongguan to provide cellular telephone and paging systems in the Pearl River Delta area of Guangdong Province.
 The city of Dongguan is situated 50 miles south of the city of Guangzhou (Canton), the largest city in Guangdong Province. Guangdong Province borders on Hong Kong in southern China and is one of the most economically developed provinces in China. On April 6, 1993, as the successor to Great Wall-Shanghai, MTC signed a joint venture contract with the Dongguan Security Services Corporation, an affiliate of the Guangdong Province Public Security Bureau. The contract has been submitted for approval to the appropriate Chinese government agencies. The company has been advised that the venture has received all government approvals except a business license. The company expects that the joint venture will receive a business license shortly. The company had intended to announce this agreement when the business license had been received, however, because of rumors in the market, the company has determined to make the announcement at this time.
 The joint venture contract contemplates that the parties will invest a total of US$25 million in the joint venture. This amount will be contributed by MTC for itself, and on behalf of its partner, in the form of paging and cellular equipment valued at US$25 million. In addition, Dongguan Security Services Corporation will provide radio frequencies and office space. The joint venture contract provides that the company will receive a preferential return for the first three years from the profits of the joint venture until the amount of its contribution for itself and its partner is repaid. Any such preferential return will be in Rmb at the official swap rate.
 The contract states and the company anticipates that the joint venture will begin operating a 150,000-subscriber capacity paging system in July 1993, and the company has ordered equipment for the paging system from Glenayre Electronics Washington. Delivery of this equipment is expected by the end of May 1993.
 The company is currently negotiating with Ericsson Communications and Motorola, Inc. for a 48,000-subscriber capacity cellular system for the Dongguan joint venture.
 After full consideration of the Great Wall-Shanghai exchange offer and after completion of an analysis by a major independent consulting firm, the Company decided that the opportunity to hold a 50 percent interest in a joint venture that would operate cellular telephone and paging systems in the Dongguan area was a bigger opportunity than a 28 percent interest in the prospective Shanghai joint venture.
 The company invested approximately U.S.$3.8 million in its prospective Shanghai joint venture. In March 1993, Great Wall-Shanghai offered to exchange its prospective 50 percent interest in the Dongguan joint venture for the company's prospective 28 percent interest and its investment to date in the Shanghai joint venture, which was then awaiting Chinese government approval. The company has agreed to complete its purchase for the Shanghai joint venture company of equipment with a value of approximately US$5 million. After this equipment is installed, the Shanghai cellular system will serve approximately 25,000 subscribers. The company will be repaid this $5 million advance in U.S. dollars on the earlier of (i) two years from the date of profitability of the Shanghai cellular system or, (ii) a maximum of 5 years. Interest will be paid at a rate, set annually, equal to the rate on six month U.S. Treasury bills plus 2 percent.
 MTC Electronic Technologies Co. Ltd. is a Canadian company headquartered in Richmond, near Vancouver, British Columbia. The Company holds interests in joint venture companies that manufacture telecommunications products and will provide telecommunications services in the People's Republic of China. It also manufactures and sells MTC brand and private-label consumer electronics in North America through discount and convenience stores.
 -0- 5/3/93
 /CONTACT: Peter Verrengia or Cindy Carpenter of Fleishman-Hillard, 212-265-9150, for MTC Electronic Technologies Co. Ltd./
 (MTCEF)


CO: MTC Electronic Technologies Co. Ltd.; China Great Wall Industry
 Corporation ST: British Columbia IN: TLS SU: JVN


TS -- NY054 -- 3762 05/03/93 11:49 EDT
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Date:May 3, 1993
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