China Digital Media Corporation Announces an Acquisition of a Media And Advertising Agent in China

China Digital Media Corporation Announces an Acquisition of a Media And Advertising Agent in China

HONG KONG, July 13 /Xinhua-PRNewswire-FirstCall/ -- China Digital Media Corporation (''Digimedia'') (BULLETIN BOARD: CDGT) with its subsidiaries (together the ''Group'') announced today that the Group signed a Shares Transfer Agreement (the ''Agreement'') to acquire an advertising sales agent, Guangdong M-Rider Media Company Limited (''Guangdong M-Rider''), a limited company registered in Guangdong in the Peoples Republic of China. The principal operating activities of Guangdong M-Rider are in design, production and distribution of advertisements through television channels. Guangdong M-Rider is one of the top five reputed advertising agents in the Guangdong province and is currently a sole advertising distributor for a number of television channels in Guangdong Province and in Guangzhou city.

Pursuant to the terms of the Agreement, the Group will acquire a 100% equity interest in Guangdong M-Rider for a total consideration of RMB1,090,000 in cash and RMB7,500,000 worth of Digimedia's restricted common shares. The management of Guangdong M-Rider in the Agreement warrants that the net operating cash inflow in the first year will not be less than RMB10,000,000.

''We are delighted to be associated with Guangdong M-Rider and we expect that this will enhance our competitiveness in the television media industry in China,'' said Mr. Daniel Ng, Chairman and CEO of China Digital Media Corporation. ''This acquisition is fruitful for both of us for the business, relationship with the top international and domestic advertising agencies, access to the renowned clients resources, and capability of sourcing quality television programs,'' Mr. Ng added, ''we target to utilize their expertise to expand our business further by setting up a nationwide advertising agent network and obtaining more sole distribution contracts with regional television stations throughout the major cities in China. We believe that this strategic move would significantly boost up our business activities and will carry our Group to grow firmly in the China market.''

For more information on us, please go to our website at http://www.chinadigimedia.com/ .

To be added to China Digital Media's investor e-mail list, please send e- mail to our Investors Relations at ir@chinadigimedia.com.

About China Digital Media Corporation

China Digital Media Corporation (BULLETIN BOARD: CDGT) focuses its business in three main areas: Cable TV Operations, Programs Production and Advertising Sales. Arcotect Technology (GZ) Limited, a wholly owned subsidiary of CDGT in China, is the sole contractor and operator of digital television services in Nanhai, a city with 400,000 cable TV subscribers. The service could offer more than 800 digital channels of pay TV programs and value added multimedia services. The Group is seeking to establish similar model elsewhere in China. The Group entered into the strategic alliance with Guangdong HuaGuang Digimedia Culture Development Limited in June 2005.

About Guangdong M-Rider Media Company Limited

Guangdong M-Rider is a limited company registered in Guangdong in the Peoples Republic of China with a registered capital of RMB5,000,000. The principal operating activities are in design, production and distribution of advertisement through television channels in which the company is currently a sole advertising distributor for a number of television channels in Guangdong Province and in Guangzhou city. The management of Guangdong M-Rider has over ten years operating experience in the advertising industry in which they have built a valuable business relationship with over 100 international and domestic advertising agencies, renowned international and domestic clients, and television channels operators. They are one of the top five reputed advertising agents in Guangdong Province.

Certain information contained in these materials is "forward-looking" information, such as projections, estimates, pro formas, or statements of intentions, expectations or plans. All forward-looking information is subject to known and unknown risks and uncertainties, many of which are outside of the control of the company. Consequently, actual results may, and probably will, differ materially from the results contemplated in such forward-looking information.

For more information, please contact:

Y. K. Ma of China Digital Media Corporation Tel: +852-2390-8686 Email: ir@chinadigimedia.com

Source: China Digital Media Corporation

CONTACT: Y. K. Ma of China Digital Media Corporation, +852-2390-8686, or ir@chinadigimedia.com

Web Site: http://www.chinadigimedia.com/

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