Sino Vanadium Inc.
TSX VENTURE : SVX

Sino Vanadium Inc.

November 04, 2011 13:10 ET

Sino Vanadium Inc. Announces Proposed Take Private Transaction

TORONTO, ONTARIO--(Marketwire - Nov. 4, 2011) - Sino Vanadium Inc. ("Sino" or "the Company") (TSX VENTURE:SVX) announces today a management sponsored take private transaction (the "Take Private Transaction"), pursuant to the terms and conditions of a support agreement (the "Support Agreement") dated November 3, 2011 among the Company and Fit Plus Holdings Ltd. ("Fit Plus"), a company controlled by Liu Bingqiang, the President, Chief Executive Officer and a director of the Company, and Ma Zhaoyang, a director of the Company, who together with eight other Shareholders (the "Majority Shareholders"), control, directly or indirectly, in aggregate approximately 73.9% of the total issued and outstanding common shares of the Company.

The Take Private Transaction is intended to be carried out by way of a redemption of all common shares (the "Redemption") held by the shareholders of the Company (other than the Majority Shareholders) (the "Minority Shareholders"), the end result being that subsequent to the Redemption, the only remaining shareholders of the Company will be the Majority Shareholders. Upon completion of the Take Private Transaction, the Company will proceed to apply to delist its common shares from the TSX Venture Exchange ("TSX-V") and apply to cease to be a reporting issuer in those jurisdictions in which it currently holds such status.

Pursuant to the Redemption, Minority Shareholders will be entitled to receive a cash payment of Cdn.$0.27 for each common share so redeemed (the "Consideration"). The cash payment for each redeemed common share represents a premium of approximately 178% over the 30-day volume weighted average trading price of the common shares on the TSX-V on the last trading day prior to this announcement of the Take Private Transaction, and a premium of approximately 170% over the 60-day volume weighted average trading price of the common shares on the TSX-V.

The board of directors of the Company (the "Board") established a special committee of independent directors comprised of Murray K. Atkins (Chair) and Conway Kong Wai Lee (the "Special Committee"), which retained an independent financial advisor to obtain both a formal valuation and a fairness opinion in respect of the Take Private Transaction. Following its deliberations, including its review of the formal valuation and the fairness opinion and the receipt of advice from independent financial and legal advisors, the Special Committee determined that the Take Private Transaction was in the best interest of the Company, and that the Consideration to be received by the Minority Shareholders pursuant to the Redemption is fair, from a financial point of view, to the Minority Shareholders, and unanimously recommended that the Board approve the Take Private Transaction and recommend to the shareholders that they vote in favour of the Pre-Redemption Amendment Resolution.

All directors of the Company entitled to vote unanimously recommend that shareholders vote in favour of the Pre-Redemption Amendment Resolution.

In order to complete the Take Private Transaction the Company is required to complete certain pre-Redemption steps, including amending the Company's Articles (the "Pre-Redemption Amendment") to permit the Redemption.

A special meeting (the "Meeting") of the shareholders of the Company has been called for December 7, 2011 (Toronto time) to be held in Toronto, Ontario. Shareholders entitled to vote at the Meeting are being asked to approve a special resolution authorizing the Pre-Redemption Amendment (the "Pre-Redemption Amendment Resolution") that must be passed by: (a) at least two-thirds of the votes cast by shareholders present in person or represented by proxy at the Meeting, and (b) for the purposes of TSX-V Policy 5.9 and Multilateral Instrument 61-101 Protection of Minority Shareholders in Special Transactions, a majority of the votes cast by the Minority Shareholders, present in person or represented by proxy at the Meeting. All shareholders of record as of October 18, 2011 (the "Record Date") will be entitled to receive notice of and to vote at the Meeting on the basis of one vote for each common share held. Full details of the Take Private Transaction, including a summary of the terms of the Support Agreement, will be included in a management information circular expected to be mailed to shareholders on or about November 9, 2011.

Shareholders should ensure that their proxies are submitted and received at least 48 hours (excluding Saturdays, Sundays and holidays) before the Meeting or the adjournment thereof at which such proxies are to be used.

The Take Private Transaction is subject to all regulatory, stock exchange and shareholder approvals.

Assuming the receipt of all necessary approvals and the satisfaction or waiver of all relevant conditions, it is expected that the Take Private Transaction will be completed on or about December 20, 2011.

Forward-Looking Statements:

This news release contains forward-looking statements relating to the proposed Take Private Transaction, including statements regarding the anticipated completion time of the proposed transaction and the delisting of the Company's common shares after completion of the transaction. Such forward-looking statements are subject to important risks, uncertainties and assumptions. The results or events predicted in these forward-looking statements may differ materially from actual results or events. As a result, you are cautioned not to place undue reliance on these forward-looking statements.

The completion of the proposed Take Private Transaction is subject to a number of terms and conditions, including, without limitation: (i) approval of the TSX-V, (ii) required shareholder approvals, (iii) support of certain remaining shareholders who will not receive the Consideration, and (iv) certain termination rights available to the parties under the Support Agreement. These approvals may not be obtained, or the conditions of the Take Private Transaction may not be satisfied in accordance with their terms, and/or the parties to the Support Agreement may exercise their termination rights, in which case the proposed Take Private Transaction could be modified, restructured or terminated, as applicable.

The forward-looking statements contained in this news release are made as of the date of this release. Except as required by applicable law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. For additional information with respect to certain of these and other assumptions and risks, please refer to the management circular to be filed by the Company with the applicable securities commissions, which will be available at www.sedar.com.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

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