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Guantao Law Firm

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Guantao advises Wah Nam (00159.HK) on its proposed takeover offer for all shares in two ASX-listed i

November 2010

On 10 November 2010, Wah Nam International Holdings Limited (00159.HK) (“Wah Nam”) released an announcement, pursuant to which WN Australia, a wholly-owned subsidiary of Wah Nam, intends to make a takeover offer for all shares in Brockman Resources Limited (“BRM”) and FerrAus Limited (“FRS”), two iron ore development companies listed on Australian Securities Exchange (ASX), and Wah Nam intends to apply for the listing of all the Wah Nam shares and options on ASX and Wah Nam will continue to be listed on the Stock Exchange of Hong Kong Limited (SEHK).

The takeover offer is for a consideration of 30 Wah Nam shares for each BRM share held and 6 Wah Nam shares for each FRS share held.  The aggregate value of such consideration is approximately HK$7.7 billion in total.  As at the date of the announcement, WN Australia holds 22.6% of all BRM shares in issue, being the biggest shareholder of BRM, and holds 19.9% of all FRS shares in issue.  According to the announcement, if the offer is successful, Wah Nam will become the only listed company on the SEHK developing significant Australian hematite iron ore projects.  In connection with the proposed application for listing on the ASX, Wah Nam is inviting subscriptions from the Australian public for 15 million offer shares in maximum, representing approximately 0.38% of the existing issued share capital of Wah Nam, at an issue price of AUD0.20 (equivalent to approximately HK$1.56) to raise up to AUD3 million (equivalent to approximately HK$23.4 million) in maximum.  The proceeds raised from the offer for subscription will be used to finance the transaction costs incurred by Wah Nam in connection with the takeover offer and the offer for subscription.

Wah Nam is an investment holding company, incorporated in Bermuda and listed on the SEHk since 2002.  With its acquisition of the Damajianshan copper mine in Yunnan province, the PRC in 2008, Wah Nam refocused itself as a mining resources company, principally engaged in the exploitation, processing and sales of mineral resources, including copper, zinc and lead concentrates in the PRC.

Guantao acts as the PRC legal advisor to Wah Nam in connection with its takeover offer and proposed listing on the ASX, conducting legal due diligence on the Damajianshan copper mine it owns, providing PRC legal opinion and issuing the solicitor’s report incorporated in the two bidder’s statements and the prospectus.  Guantao team is led by partners Mr. Xiao Hongming and Ms. Xu Ling, assisted by associate Wang He.  Prior to this transaction, Guantao also advised Wah Nam on its acquisition of Damajiansan copper mine in the PRC.

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