Important Notice
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Panzhihua Steel Vanadium Co., Ltd. (hereinafter referred to as "Panzhihua Steel Vanadium") intends to implement a significant asset restructuring (hereinafter referred to as "this major asset restructuring") by issuing shares to Panzhihua Iron and Steel (Group) Company (hereinafter referred to as "Panzhihua Group") and its affiliates to purchase assets, while absorbing and merging Chongqing Titanium Industry Co., Ltd. (hereinafter referred to as "Chongqing Titanium") and Sichuan Changcheng Special Steel Co., Ltd. (hereinafter referred to as "Changcheng"). On December 25, 2008, the China Securities Regulatory Commission (hereinafter referred to as "CSRC") issued the approval for Panzhihua Steel Vanadium's issuance of shares to purchase assets and absorb the merger of Chongqing Titanium and Changcheng (CSRC Permit [2008] No. 1445), approving this major asset restructuring.
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According to the relevant plan for the share swap absorption merger of Panzhihua Steel Vanadium with Chongqing Titanium and Changcheng (hereinafter referred to as "this merger"), to fully protect the interests of shareholders of Panzhihua Steel Vanadium, Chongqing Titanium, and Changcheng, Panzhihua Steel Vanadium has arranged for a third party, Anshan Iron and Steel Group Co., Ltd. (hereinafter referred to as "Ansteel Group"), to provide cash options (hereinafter referred to as "the first cash option") to all other shareholders of Panzhihua Steel Vanadium, Chongqing Titanium, and Changcheng, excluding Panzhihua Group and its affiliates, as well as shareholders who have committed not to exercise the cash option. To encourage more shareholders of Panzhihua Steel Vanadium with cash options to continue holding Panzhihua Steel Vanadium shares, Ansteel Group has further committed to provide an additional cash option exercise right (hereinafter referred to as "the second cash option") to those shareholders who did not declare the exercise of the first cash option by the deadline.
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The record date for the share swap absorption merger is April 28, 2009.
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After the implementation of this share swap absorption merger, Chongqing Titanium (000515) and Changcheng (000569) will apply to the Shenzhen Stock Exchange for the termination of their listing status, while Panzhihua Steel Vanadium (000629) will submit an application for the listing of the newly issued shares, and trading of Panzhihua Steel Vanadium shares will resume after the completion of the above procedures.
I. Panzhihua Steel Vanadium's Major Asset Restructuring Plan
(1) Issuance of Shares to Purchase Assets
Panzhihua Steel Vanadium intends to issue shares to Panzhihua Group and its affiliates as a payment method to purchase operational assets related to steel, vanadium, titanium, and mining. The issuance price of the shares is set at the average trading price of Panzhihua Steel Vanadium shares over the twenty trading days prior to the announcement of the first board resolution for this major asset restructuring, which is 9.59 yuan/share. The total assessed value of the assets to be purchased is 740,714,920 yuan, and Panzhihua Steel Vanadium will issue a total of 750 million shares to four subscribing parties according to the assessed value of the assets injected, issuing 184,419,566 shares to Panzhihua Group, 186,884,886 shares to Panzhihua Iron and Steel Co., Ltd., 334,675,348 shares to Chengdu Iron and Steel Co., Ltd., and 44,020,200 shares to Sichuan Changcheng Special Steel Co., Ltd.