09:58     ORIENTAL METALS<01208> - Announcement (2)                           

    In the course of preparation of the circular to be                        
    issued to the Shareholders, it is confirmed by CMN                        
    that no shareholders' loan is currently owing by                          
    Target BVI to the Vendor or its Associates but certain                    
    sums are owing to CMN by other members of the Target                      
    Group as follows:                                                         
                                                                              
    (i)     a sum of approximately RMB715.9 million as at                     
    30 September 2004 owed by Sino Mining Alumina (an                         
    indirect subsidiary of Target BVI after the                               
    Reorganisation) to CMN. Such sum is in fact a loan                        
    arranged by CMN from a bank and on-lent to Sino Mining                    
    Alumina on the same commercial terms. The bank loan                       
    is secured by, inter alia, a charge on the entire                         
    equity capital of and a floating charge over all the                      
    assets of Sino Mining Alumina in favour of the bank;                      
    and                                                                       
                                                                              
    (ii)    a sum of approximately RMB28.1 million as at 30                   
    September 2004 owed by the Target Group to CMN. This                      
    sum represents an unsecured interest free loan from                       
    CMN.                                                                      
                                                                              
    The Company is reviewing information concerning these                     
    sums with a view to determining appropriate                               
    arrangements in relation thereto.                                         
                                                                              
    The parties to the Acquisition Agreement wish to                          
    confirm that the consideration for the acquisition                        
    of the entire issued share capital of Target BVI and                      
    the benefits in the entire shareholders' loan as at                       
    Completion (if any) owing by Target BVI to the Vendor                     
    and/or its Associates will remain unchanged at                            
    HK$2,886 million as announced on 30 December 2004.                        
    It is the intention of the parties to the Acquisition                     
    Agreement that the Company will acquire all interest                      
    in Target BVI, namely all the issued shares in and                        
    all shareholders' loan to Target BVI, if any, from                        
    the Vendor and/or its Associates. They do not expect                      
    there to be any shareholders' loan to Target BVI                          
    outstanding from the Vendor and/or its Associates                         
    upon Completion, and the consideration of the                             
    Acquisition was determined on such basis. Given the                       
    basis for determining the consideration of the                            
    Acquisition mentioned above, the parties have also                        
    confirmed that no adjustment is required to be made                       
    to the consideration for the Acquisition arising from                     
    the clarification of the amount of the shareholders'                      
    loan in this announcement.                                                
                                                                              
    As set out in the Announcement, the Company is                            
    collecting information on the possible future ongoing                     
    connected transactions between members of the                             
    Minmetals Group and the Enlarged Group immediately                        
    following Completion. Further details of these                            
    connected transactions and the outstanding amounts                        
    owing to CMN mentioned above will be disclosed in a                       
    further announcement and in the circular to be issued                     
    to the Shareholders, as may be necessary.                                 
                                                                              
    ESTABLISHMENT OF INDEPENDENT BOARD COMMITTEE AND                          
    APPOINTMENT OF INDEPENDENT FINANCIAL ADVISER                              
    The Board wishes to announce that an independent board                    
    committee comprising Messrs. Liu Hongru, Chan Wai                         
    Dune and Ting Leung Huel, Stephen has been established.                   
    Somerley Limited has been appointed as the                                
    independent financial adviser to the independent                          
    board committee and the Independent Shareholders.                         
                                                                              
    DELAY IN THE DESPATCH OF THE CIRCULAR                                     
    As stated in the Announcement, a circular