China Natural Resources Acquires Coal Mining Company In Guizhou Province, PRC
HONG KONG, May 11 /PRNewswire/ -- CHINA NATURAL RESOURCES, INC. (Nasdaq: CHNR), a company based in the People's Republic of China ("PRC"), today announced that, on April 30, 2010 it entered into an agreement (the "Agreement") with Feishang Group Limited ("Shareholder"), a related party, pursuant to which China Natural Resources acquired from the Shareholder (a) all of the issued and outstanding capital stock (the "Shares") of Wealthy Year Limited ("Wealthy Year") and its wholly-owned subsidiaries (collectively, the "Coal Group") and (b) the HK$12,407,324 (US$1,590,683) outstanding indebtedness owing by Wealthy Year to the Shareholder on the closing date ("Indebtedness").
Wealthy Year, through its subsidiaries, owns mining rights to and/or operates five coal mines located in Guizhou Province, the PRC.
The purchase price for the Shares and Indebtedness is US$87 million, subject to adjustment. The purchase price was determined with reference to, inter alia, the independent valuation of the equity value of the five mining subsidiaries of the Coal Group amounting to approximately RMB1,190 million ( US$174.33 million) compiled by Norton Appraisals Limited. Additional details of the transaction are contained in the Company's Current Report on Form 6-K filed with the Securities and Exchange Commission on May 11, 2010.
Mr. Feilie Li, the Company's CEO and Chairman commented: "The acquisition is consistent with our strategy to expand our coal and metal reserves through acquisitions. We are positive about the prospect of the coal mining industry in the PRC. In view of the continuing economic growth in the PRC, we believe that demand for coal will continue to be robust in the foreseeable future and the tension for global energy demand will continue".
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