Qingdao Haier Co., Ltd. is principally engaged in the manufacture and sale of household electrical appliances. The Company primarily provides refrigerators, freezers, air conditioners, dishwashers, microwave ovens, gas stoves, washing machines and other household electrical appliances. The Company distributes its products under the brand name of Haier in China’s domestic market and to overseas markets. During the year ended December 31, 2007, the Company obtained approximately 39% and 35% of its total revenue from the sale of refrigerators and air conditioners, respectively. As of December 31, 2007, the Company had 10 major subsidiaries/associates.