AUD$0.22 Per Share Cash Offer by Shanxi Donghui Coal Coking & Chemicals Group Co., Ltd for Inova Resources Ltd

SHANXI, CHINA--(Marketwired - Aug. 21, 2013) - Shanxi Donghui Coal Coking & Chemicals Group Co., Ltd (Shanxi Donghui) wishes to announce its intention to make an off-market takeover bid to acquire all of the ordinary shares in Inova Resources Ltd (Inova) (the Takeover Offer).

Highlights

• Shanxi Donghui's offer is for AUD$0.22 cash per Inova share.
  
  
• Premium of 55% to the 3 month volume weighted average ASX trading price (VWAP) of $0.142 and 29% to the ASX closing price of $0.170 per Inova share on 20 August 2013.
  
  
• Shanxi Donghui's offer provides Inova shareholders with certainty of value at an attractive, risk-free, cash premium for their investment.
  
  
• Inova's largest shareholder, Turquoise Hill Resources Ltd has entered into a pre-bid acceptance agreement for 14.9% of Inova.
  

Mr Zhang Yaping, Chairman of Shanxi Donghui, said:

"Shanxi Donghui looks forward to progressing the development of Inova's mines and growth projects and managing the inherent risks involved. We believe our offer provides Inova shareholders with a full and fair risk-free cash premium for their investment."

Details of the Takeover Offer

Shanxi Donghui's offer is for AUD$0.22 cash per share, valuing Inova at approximately AUD$160 million. The Takeover Offer represents a 29% premium over the closing price of $0.170 per Inova share on the Australian Securities Exchange (ASX) on 20 August 2013 and a 55% premium over the volume weighted average price of Inova shares over the last 3 month VWAP on the ASX of $0.142. The Takeover Offer will be financed through Shanxi Donghui's existing cash resources.

The consideration under the Takeover Offer is equivalent to approximately $0.207 Canadian dollars per share assuming the closing AUDCAD exchange rate of 0.9426 on the 20^th August 2013.

Conditions to the Takeover Offer

The Takeover Offer will be subject to a number of conditions, which will be set out in the offering document.

Pre-bid Acceptance Deed

Shanxi Donghui has entered into a pre-bid acceptance deed (PBAD) with Turquoise Hill Resources Ltd (Turquoise Hill) in respect of 14.9% of the issued shares in Inova equating to 108,502,084 Inova shares (Sale Shares). Prior to entering the PBAD Shanxi Donghui did not hold a relevant in any Inova securities.

Turquoise Hill owns approximately 56.2% of Inova's issued capital via its wholly owned subsidiary, IAL Holdings Singapore Pte Ltd, an unlisted Singaporean company. In total (including the Sale Shares), IAL Holdings Singapore Pte Ltd currently holds approximately 56.2% of the shares in Inova.

Under the PBAD:

1. Turquoise Hill agrees to procure that IAL Holdings Singapore Pte Ltd accepts the Takeover Offer in respect of the Sale Shares by not later than 5 business days after the day on which Shanxi Donghui declares or announces that except for the 51% minimum ownership condition all other Bid conditions attaching to the Takeover Offer have been satisfied or waived.
   
   
2. IAL Holdings Singapore Pte Ltd is not required to accept the Takeover Offer in respect of the Sale Shares earlier than 2 weeks after the date of the offer under the Takeover Offer or if a superior proposal is publicly announced or made which is not at least matched by Shanxi Donghui within 5 business days.
   

About Shanxi Donghui

Shanxi Donghui is a leading coking coal, coke and chemicals producer in Shanxi province, China. Shanxi Donghui is privately owned by the Chairman Mr Zhang Yaping and his brother Mr Zhang Weidong.

Shanxi Donghui has in excess of 1 billion Chinese Renminbi cash on hand to enable it to fund the Takeover Offer.

Shanxi Donghui's head office is located at 95 Xinjian North Road, Yingze District, Taiyuan, Shanxi, China.

Benefits of the Takeover Offer

Shanxi Donghui's offer provides Inova shareholders with certainty of value at an attractive, risk-free, cash premium for their investment.

Bidders Statement

Shanxi Donghui expects to dispatch shortly its Bidder's Statement to all Inova shareholders containing detailed information relevant to the Takeover Offer.

The Takeover Offer will be open for acceptance for a period of not less than one month from the date the documents are mailed.

Intention of Shanxi Donghui

If Shanxi Donghui receives acceptances for 90% or more of Inova shares, Shanxi Donghui intends to take steps available to it to acquire compulsorily any outstanding Inova shares.

Shanxi Donghui has retained Thomsons Lawyers to act as legal adviser and PricewaterhouseCoopers Securities Limited and Sapphire International Capital as joint financial advisers in relation to the Takeover Offer.