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Business News of Thursday, 30 August 2012

Source: Cameroon Tribune

Hanlong, Sundance Agree on Take-Over Price for Mbalam Iron Project


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Hanlong (Africa) Mining Investment Limited's proposal to revise the price of the Scheme Implementation Agreement for the acquisition of 100 per cent of the company for 0.45 Australian dollars per share.

Hanlong's proposal and the Board's consent - the release posted on Sundance's website indicates - follows the announcement earlier this month that China's National Development and Reform Commission (NDRC) had granted provisional approval for Hanlong to acquire Sundance. "The receipt of NDRC provisional approval is an essential step towards achieving all necessary Chinese regulatory approvals, which in turn are conditions precedent to completion of the Scheme," the release states.

Sundance Chairman, George Jones is quoted as saying the Board had decided to accept Hanlong's proposal. This now gives way for the company's shareholders to determine if the revised price is acceptable after extensive negotiations with Hanlong that took into account a number of factors.

"The Board believes that the revised offer is worthy of putting to shareholders in light of several key considerations," Mr Jones said. "These include the requirements expressed in the NDRC provisional approval and the change in financial markets since the original agreement was struck in October 2011," he added.

Following discussions with NDRC and CDB, Hanlong in the release proposes to Sundance that the revised Scheme Price of 0.45 Australian dollars per share is a "reasonable acquisition price" for NDRC and CDB purposes. Hanlong has committed to paying a break fee equal to one per cent of the transaction value (approximately $14 million). In the event Hanlong seeks to further reduce the Scheme Price, Sundance will terminate the revised SIA. Hanlong, after consultation with CDB, has confirmed that it is confident that a final decision by CDB as to whether to proceed with a facility to Hanlong can be made in time to meet a completion date by the end of 2012.

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