Sundance Resources Limited (ASX:SDL) Board Unanimously Recommends Increased Offer Of 57 Cents Cash Per Share From Hanlong

Perth, Australia (ABN Newswire) - Sundance Resources Limited (ASX:SDL) is pleased to announce that Hanlong (Africa) Mining Investment Limited ('Hanlong') has proposed to acquire 100 per cent of the Company for A$0.57 cash per share via an Australian Scheme of Arrangement ('Scheme').


Sundance Directors believe the price, which values the Company at A$1.65 billion, is attractive and therefore unanimously recommend shareholders vote in favour of the Scheme in the absence of a superior proposal, and subject to the Independent Expert's report concluding the Scheme is in the best interests of all Sundance shareholders.

The price represents a 65.3 per cent premium to Sundance's Volume-Weighted Average Price (VWAP) in the one month leading up 15 July 2011, when Sundance received Hanlong's initial proposal for a conditional cash offer. It represents a 56.3 per cent premium to Sundance's three-month VWAP to 15 July 2011.

As a result of the Hanlong proposal, Sundance has signed a legally binding, conditional Scheme Implementation Agreement ('SIA') with Hanlong for the acquisition of all of the outstanding fully-paid ordinary shares of Sundance not currently owned by Hanlong by way of a Scheme.

In March 2011, Hanlong became Sundance's largest shareholder after acquiring all of the shares in the Company previously owned by Ken Talbot's estate. Hanlong's decision to become a major shareholder at the time was a further indication of Chinese interest and recognition in the validity of Sundance's strategy to develop the Mbalam Iron Ore Project over the next four years.

The world-class nature of the Mbalam Iron Ore Project was highlighted by the recent announcement that it now boasts High-Grade Hematite Resources of 521.7 million tonnes (Mt) grading 60.7 per cent Fe and a further 2.3 billion tonnes (Bt) of Itabirite Hematite Resources at 38 per cent Fe.

The Project is forecast to produce 35 million tonnes per annum (Mtpa) of Direct Shipping Ore (DSO)- quality High-Grade Hematite for ten years in stage one, then continue production at 35Mtpa of Itabirite Hematite for at least an additional 15 years, generating an internal rate of return of 27 per cent on an ungeared basis based on the DFS published in April 2011.

The development of the Mbalam Project will include construction of a new deepwater port for the export of iron ore and heavy haulage railway connecting the mines to the port. This extensive infrastructure network will play a key role in opening up the world's next major iron ore province, of which Mbalam will be the cornerstone.

Offer Pricing

Hanlong has proposed to acquire 100 per cent of the Company for A$0.57 cash per share via a Scheme.

Sundance believes the offer price represents an attractive premium for Sundance shareholders on a range of measures:

- A 32.6% premium to Sundance's closing share price on 30 September 2011, the last day that Sundance traded prior to signing the SIA;

- A 42.5% premium to Sundance's closing share price on 15 July 2011

- A 65.3% premium to Sundance's 1 month VWAP to 15 July 2011; and

- A 56.3% premium to Sundance's 3 month VWAP to 15 July 2011.

Implementation and Conditions

The acquisition of Sundance by Hanlong will be by way of a Scheme.

The Scheme is conditional on regulatory approvals in the Republics of Cameroon and Congo, as well as in the People's Republic of China, and certain other conditions which are set out in the Summary of Key

Terms attached at the end of this announcement (Appendix A). Australian Foreign Investment Review Board approval will also be required.

The parties will proceed with the transaction in two phases.

The first phase will have Sundance and Hanlong enter into an exclusive arrangement with the mutual objective of working together to confirm the ratification of the Mining Permit in the Republic of Congo and the Mining Convention in the Republic of Cameroon on acceptable terms.

Phase two involves the first court hearing, publication of the Scheme Booklet, and the holding of the Scheme Meeting. Completion of the transaction is subject to the necessary shareholder approvals and that finance commitments and the Permit and the Convention become binding. Following this, the parties will request that the Court approves the Scheme.

It is anticipated that Sundance shareholders will receive Scheme documents in approximately March 2012 and would vote on the Scheme in April 2012, with completion of the transaction expected by May 2012.

Ernst & Young will be appointed to prepare the Independent Expert's report to determine whether the Scheme is in the best interests of Sundance shareholders. This report will accompany the Scheme Meeting documentation to be released to shareholders in line with the timing as mentioned above.

Sundance Chairman George Jones said he believed the offer was attractive to shareholders.

'After careful consideration, the Sundance Board has unanimously concluded that the offer represents an attractive price and provides shareholders with an opportunity to realise considerable value from their investment in Sundance,' Mr Jones said.

'The offer values Sundance at A$1.65 billion compared with the Company's market capitalisation of approximately A$350 million in June 2010. This increase in shareholder value reflects the world-class attributes of the Mbalam Iron Ore Project in the Republics of Cameroon and Congo and its potential to unlock a new iron ore province in West Africa.

'Hanlong's offer means that the substantial financial support needed for this integrated port, rail and mine project will now be available, in the process realising substantial value for Sundance shareholders and immense benefits for the people of the Republics of Cameroon and Congo.'

About Hanlong

Sichuan Hanlong (Group) Co, Ltd was established in 1997 by its Chairman Mr Liu Han. It is one of China's largest private enterprises with total assets exceeding 20 billion RMB (A$3 billion) and annual sales revenue of over 16 billion RMB (A$2.48 billion). The Group has a wide portfolio of investments including mining resources, energy generation, infrastructure development, pharmaceutical, food and beverages, real estate and tourism. The Group has over 30 wholly-owned subsidiaries and more than 12,000 employees world-wide. Hanlong is a subsidiary of Hanlong Resources Limited and both are within the Hanlong Mining Group. Hanlong has an office in Sydney.

Background Sundance

Sundance Resources Ltd (Sundance) is an international iron ore exploration and development company which is building a global iron ore business in central West Africa. Sundance is listed on the Australian Securities Exchange (ASX) as is in the benchmark S&P ASX 200.

Sundance's goal is to become a major global iron ore producer within the next four years through the development of the Mbalam Iron Ore Project (Project). It is an integrated Mine, Port and Rail Project with targeted annual production capacity of 35Mtpa of Direct Shipping Ore for approximately the first 10 years, followed by continuing production at 35Mtpa of Itabirite Hematite for a further 15 years.

The Project is located in an area that straddles the border of the Republics of Cameroon and Congo in central West Africa. The Project comprises Exploration Permit 92 (EP92) located in the East Province of the Republic of Cameroon, and Research Permits Nabeba-Bamegod (Nabeba) and Ibanga, located in the Sangha Province of the Republic of Congo. EP92 is owned by Cam Iron SA, a company incorporated in the Republic of Cameroon which is a 90%-owned subsidiary of Sundance. Nabeba and Ibanga permits are owned by Congo Iron SA, a company incorporated in the Republic of Congo and is an 85%-owned subsidiary of Sundance.

Sundance is being advised by UBS AG, Clayton Utz and CITIC Securities.

About Sundance Resources Limited:

Sundance Resources Limited (ASX:SDL) (PINK:SUDCF) is an international resources company developing the Mbalam Iron Ore Project in the Republic of Cameroon and the Republic of Congo, in central west Africa. Sundance Resources is listed on the Australian Securities Exchange and is part of the S&P ASX200 Index.

The Company's corporate head office is based in Perth, Western Australia, home to the world-class iron ore deposits of the Pilbara region. This location means the Company has assembled a management and technical team that draws readily on the skills of some of the world’s most experienced iron ore specialists as it continues to cement its position as an emerging force in the global iron ore sector.

Source:

Sundance Resources Limited

Contact:

George Jones 
Chairman 
Sundance Resources Ltd. 
Mobile:  61-412-949-250 

Giulio Casello
Managing Director & CEO
Sundance Resources Ltd.
Mobile:  61-448-872-887

Shareholder/Media enquiries:
Jill Thomas
Sundance Investor Relations Manager
Telephone:  61-8-9220-2300
Mobile:  61-487-440-016
Email: info@sundanceresources.com.au