G-Resources Group Limited — M&A Activity 2008

Apr 22, 2008

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

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(Incorporated in Bermuda with limited liability) ( Stock Code: 1051 )

VERY SUBSTANTIAL DISPOSAL, VERY SUBSTANTIAL ACQUISITION

AND

RESUMPTION OF TRADING

The Board is pleased to announce that on 17 April 2008, the Company entered into the Agreement with the Purchaser, a wholly-owned subsidiary of SUNPEC, pursuant to which the Company has conditionally agreed to procure the Vendors, and the Vendors have agreed, to sell, and the Purchaser has conditionally agreed to acquire, the Sale Shares at a total consideration of HK$810 million, which will be settled as to HK$100 million in cash, payable within 30 days after the publication of the announcement of SUNPEC regarding the Sale and as to the remaining balance of HK$710 million by the issue and allotment by SUNPEC of 253,571,428 Consideration Shares at HK$2.80 per Consideration Share.

The Sale constitutes a very substantial disposal, and the acquisition of the Consideration Shares, as part consideration for the Sale, pursuant to the Sale constitutes a very substantial acquisition, for the Company under the Listing Rules and are conditional upon approval by the Shareholders at the SGM. A circular containing the details of the Sale, together with a notice of SGM, will be despatched to the Shareholders as soon as practicable.

At the request of the Company, trading in the Shares on the Stock Exchange was suspended at 9:30 a.m. on 18 April 2008 pending the release of this announcement. Application has been made by the Company to the Stock Exchange for the resumption of trading in the Shares with effect from 9:30 a.m. on 23 April 2008.

The Board is pleased to announce that on 17 April 2008, the Company entered into the Agreement with the Purchaser.

THE AGREEMENT

Date of the Agreement: 17 April 2008

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Parties to the Agreement:

• (i) The Company;

• (ii) Dorson Group Limited, Hopestar Group Limited and Dormer Group Limited, all of which are wholly-owned subsidiaries of the Company; and

• (iii) Rich Theme Holdings Limited, which is a wholly-owned subsidiary of SUNPEC. The SUNPEC Group is a third party independent of the Company and its connected persons. Further information of the SUNPEC Group is set out in the paragraph headed “Information on the SUNPEC Group” below.

Assets to be disposed of

The Sale Shares, being 360 ordinary shares of US$1.00 each in the share capital of MPIL, representing 36% of the equity interest in MPIL.

Consideration

The total consideration for the Sale is HK$810 million, which shall be settled by the Purchaser in the following manner:

• (i) as to HK$100 million shall be paid in cash as a refundable deposit within 30 days after the publication of the announcement of SUNPEC regarding the Sale; and

• (ii) as to the remaining balance of HK$710 million shall be satisfied by the issue and allotment of 253,571,428 Consideration Shares by SUNPEC at HK$2.80 per Consideration Share to the Company or its nominee(s).

The consideration was determined after arm’s length negotiations between the Purchaser, the Company and the Vendors with reference to (i) the commercial prospect of Oilfield Block 2104; (ii) the estimated value of Oilfield Block 2104, the major asset of MPIL, of approximately HK$5 billion opined by BMI Appraisal Limited, an independent valuer, as at 12 February 2008; (iii) the estimated reserves of Oilfield Block 2104 assessed by Chinese University of Petroleum, an independent professional oil reserve assessor; and (iv) the consideration of the acquisition of 54% equity interest in MPIL, which constitute a major and connected transaction of SUNPEC and the details of which was announced by SUNPEC on 9 November 2007. The Board has noted fully, among other matters, the estimated value of Oilfield Block 2104 opined by BMI Appraisal Limited and is of the view that such value, as derived on the assumption of no change of certain factors, such as operational information of Oilfield Block 2104 and environmental and competition for the market in which Oilfield Block 2104 is exposed to, does not necessarily reflect the ultimate fair value of the minority interest of the Group in MPIL. The Board reiterates that it is in the interests of the Company and the Shareholders for the Company to realize the present value of its investment by reference to the consideration of the Sale, as the realization of the estimated value of Oilfield Block 2104 as opined by the valuer would encounter the unforeseeable risks in exploration and exploitation of the project and entail necessary capital commitment by the Group into MPIL for further development.

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The issue price of the Consideration Shares was determined after arm’s length negotiation between the Purchaser, the Company and the Vendors with reference to the recent trading performance of the SUNPEC Shares and the business prospects of the SUNPEC Group; and the issue price of the consideration shares issued by SUNPEC in the acquisition of 54% equity interest in MPIL mentioned above.

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Conditions precedent

Completion shall be conditional upon fulfillment of the following conditions:

• (i) the passing of the relevant resolutions at the SGM by the Shareholders for approving the Agreement and transactions contemplated therein;

• (ii) the passing of the relevant resolutions at the special general meeting of SUNPEC by its independent shareholders for approving the Agreement and transactions contemplated therein; and

• (iii) the listing of and permission to deal in the Consideration Shares having been granted to SUNPEC by the Stock Exchange.

Completion shall take place on the third business day immediately after the date on which all conditions precedent are satisfied, which shall not be later than 30 August 2008. In the event that Completion cannot occur on or before 30 August 2008 due to the non-fulfillment of the condition (i) above or any other reason caused by the Company and the Vendors, the Company or the Vendors (as the case may be) shall inform the Purchaser immediately and the deposit of HK$100 million (together with the interests accrued thereon, calculated at the rate of 5% p.a.) shall be refunded to the Purchaser within three business days.

Consideration Shares

For the purpose of the Listing Rules, the acquisition of the Consideration Shares, as part consideration for the Sale, pursuant to the Sale constitutes a very substantial acquisition for the Company. The Consideration Shares, when issued and allotted on Completion, will represent (i) approximately 4.69% of the issued share capital of SUNPEC as at the date of this announcement; and (ii) approximately 4.46% of the issued share capital of SUNPEC as enlarged by the issue of the Consideration Shares (assuming no further issue of SUNPEC Shares prior to Completion).

Based on the issue price of HK$2.80 per Consideration Share, the aggregate value of the Consideration Shares amounts to HK$710 million.

Pursuant to the Agreement, the Company has unconditionally and irrevocably undertaken to and covenanted with the Purchaser that, without the prior written consent of the Purchaser, the holder(s) of the Consideration Shares will not transfer, dispose of or pledge in any form the whole or any part of the Consideration Shares to any third party, for a period of one year commencing from the issue date of the Consideration Shares.

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INFORMATION ON MPIL

To the best knowledge of the Directors, MPIL is an investment holding company incorporated in the British Virgin Islands, which has not commenced any significant business operations other than the entering into of the Production Sharing Contract with OMNIS in respect of Oilfield Block 2104, an onshore site with total area of 20,100 kilometer square in Madagascar, for oil and gas exploitation and operation and certain transactions pertaining thereto. Pursuant to the Production Sharing Contract, MPIL is vested with all the relevant rights to engage in oil and gas exploration for 8 years, oilfield development for 5 years, and exploitation and operation for oil for 25 years (with 5 years possible extension) and gas for 35 years (with 10 years possible extension) at Oilfield Block 2104. Depending on the rate of crude oil production of Oilfield Block 2104, MPIL will share the remaining profit oil after government royalty according to the sharing ratios in the range of 45% to 73% as set out in the Production Sharing Contract. MPIL is responsible for the arrangement of the required capital commitment, human resources and equipment for the project development of oil and gas in Oilfield Block 2104. The mining title of Oilfield Block 2104 was granted to OMNIS under the Presidential Decree numbered 2005-707 dated 19 October 2005 and the Director General of OMNIS issued a written confirmation on 8 November 2007 to certify that MPIL is granted with the mining right in Oilfield Block 2104 and the contractor of MPIL is authorized to perform their exploration work in Oilfield Block 2104.

During the period from January 2006 to November 2007, the Company, through the Vendors, acquired the Sale Shares, representing an aggregate of 36% equity interest on MPIL for a total consideration of HK$506,780,000. Other than the consideration paid for the Sale Shares, the Group has not up to the date of this announcement made any capital investment in MPIL for its investment or development in Oilfield Block 2104, as such capital investment, which depends on a number of factors including the results of fieldwork, the amount of oil and gas reserves discovered and the scale and method of exploration work required, cannot be ascertained at present stage.

The audited loss before and after taxation and extraordinary items of MPIL for the period from 23 June 2005 (being the date of its incorporation) to 31 March 2006, for the year ended 31 March 2007 and for the eight months ended 30 November 2007 was approximately HK$1.6 million, HK$3.5 million and HK$7.5 million respectively. As at 30 November 2007, the audited consolidated net liabilities of MPIL were approximately HK$12.6 million.

The net asset value of the Sale Shares as at 31 December 2007 was HK$506,780,000, being the equivalence of the total consideration paid by the Group for the Sale Shares. The Company would expect to realize a net disposal gain of approximately HK$303,220,000 as a result of the Sale, subject to audit. However, the final net disposal gain of the Company realized from the Sale at Completion will depend on the trading price of SUNPEC Shares as at the date of Completion and at the time of the realization of the Consideration Share by the Company.

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INFORMATION ON SUNPEC GROUP

To the best knowledge of the Directors, the SUNPEC Group is principally engaged in the sale and distribution of polyurethane materials in the PRC as well as oil exploration and exploitation in the Republic of Madagascar. Upon the issue of the Consideration Shares, the Company and the Vendors will own 253,871,428 SUNPEC Shares (which comprise 300,000 SUNPEC Shares the Group owns as at the date of this announcement and 253,571,428 Consideration Shares), which represent approximately 4.46% of the issued share capital of SUNPEC as enlarged by the issue of the Consideration Shares (assuming no further issue of SUNPEC Shares prior to Completion).

Based on the latest published financial information available to the Directors, (i) the audited profit before and after taxation of SUNPEC for the year ended 31 March 2006 was approximately HK$3.0 million and HK$0.6 million, respectively; and the audited profit before and after taxation of SUNPEC for the year ended 31 March 2007 was approximately HK$10.9 million and HK$8.1 million, respectively; and (ii) the unaudited profit before and after taxation of SUNPEC for the 6 months ended 30 September 2007 was HK$4,445 million and HK$4,440 million. As at 30 September 2007, the unaudited consolidated net assets of SUNPEC were approximately HK$5,727 million.

REASONS FOR THE SALE

The Company is an investment holding company and the Group is principally engaged in the provision of credit card security services and provision of financial information through internet and mobile phones and information technology related business and investment in the oil and gas business. After Completion, the Group will continue to engage in the provision of credit card security services and provision of financial information through internet and mobile phones and information technology related business, which will continue to contribute to the results of the Group and maintain a sufficient level of operation. As announced by the Company on 5 March 2008, the Company is currently in the process of acquiring 51% equity interest in Mongol Oil Shale LLC, a company incorporated in Mongolia, which holds exploration and mining rights in a coal mine comprising land and has an estimated total land area of 96 square kilometres situated in Bayan Soum of the Tuv Province, Mongolia. The Company is continuously looking for business opportunities in Mongolia and other resources rich countries. With the recent visit of the Mongolia President to Hong Kong on 9 April 2008, the Board believes the Group can foster a long-term relationship with the Mongolia Government. Accordingly, the Company will, in addition to the existing business mentioned above, deploy its resources in the development of business opportunities in Mongolia.

While the Board has reckoned and valued the opportunity to acquire the interest in MPIL (through the acquisition of the Sale Shares) in that the Group can participate in the project in its initial stage, it is of the view that the Sale presents a good opportunity for the Company to yield, in part, a reasonable return from its investment in MPIL and the acquisition of the Consideration Shares as part consideration for the Sale will also enable the Group to participate, indirectly through the equity interest in SUNPEC, in the further development in Oilfield Block 2104.

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In deciding (i) the timing of the Sale, (ii) the unlisted nature of the Sale Shares and (iii) whether the consideration for the Sale represents a fair value of the Sale Shares (and the ultimate indirect interest of the Group in MPIL), the Directors have taken into account fully, among other matters, the recent business development of SUNPEC in its principal business (in particular, oil exploration and exploitation business in the oilfield block 3113 in Madagascar). Essentially, the Sale constitutes a swap of the minority interest in MPIL, which is not listed securities, for the SUNPEC Shares, which are listed and traded on the Stock Exchange, through which the Group can realize its investment for better financial resources that enable it to further develop its business in the oil and gas field. It is of particular importance that given the limited liquidity of the Sale Shares, which are unlisted securities, the opportunity for the realization of such interest at a significant amount does not occur very often. Taking into account the above mentioned factors, the Sale is in the best interests of the Company and the Shareholders as a whole.

The Directors (including the independent non-executive Directors) consider that the Agreement is on normal commercial terms and the terms of which are fair and reasonable and the entering into of the Agreement is in the interests of the Company and the Shareholders as a whole.

USE OF PROCEEDS

The total net cash proceeds of approximately HK$99 million from the Sale will be applied as general working capital of the Group.

LISTING RULES IMPLICATIONS

The Sale constitutes a very substantial disposal, and the acquisition of the Consideration Shares, as part consideration for the Sale, pursuant to the Sale constitutes a very substantial acquisition, for the Company under Chapter 14 of the Listing Rules and are conditional on approval by the Shareholders at the SGM.

A circular containing further information on the Sale and the Group, together with a notice of the SGM, will be despatched to the Shareholders as soon as practicable.

RESUMPTION OF TRADING IN THE SHARES

At the request of the Company, trading in the Shares on the Stock Exchange was suspended at 9:30 a.m. on 18 April 2008 pending the release of this announcement. Application has been made by the Company to the Stock Exchange for the resumption of trading in the Shares with effect from 9:30 a.m. on 23 April 2008.

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DEFINITIONS

In this announcement, unless the content otherwise requires, the following expressions have the following meanings:

“Agreement”	the conditional sale and purchase agreement dated 17 April 2008 entered
	into between the Company, the Vendors and the Purchaser for the sale and
	purchase of the Sale Shares
“associates”	has the meanings ascribed thereto under the Listing Rules
“Board”	the board of Directors
“Company”	Smart Rich Energy Finance (Holdings) Limited, a company incorporated in
	Bermuda with limited liability and the shares of which are listed on the
	Main Board of the Stock Exchange
“Completion”	completion of the Sale
“connected person(s)”	has the meaning ascribed thereto under the Listing Rules
“Consideration Shares”	253,571,428 new SUNPEC Shares to be issued by SUNPEC to the
	Company or its nominee(s), as part of the consideration for the Sale, upon
	Completion
“Director(s)”	the director(s) of the Company
“Group”	the Company and its subsidiaries
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong”	the Hong Kong Special Administrative Region of the People’s Republic of
	China
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock Exchange
“Madagascar”	the Republic of Madagascar
“MPIL”	Madagascar Petroleum International Limited, a company incorporated in
	the British Virgin Islands with limited liability in June 2005 and the issued
	share capital of which is beneficially owned as to 54% by SUNPEC, 10%
	by Dr. Hui Chi Ming (chairman, an executive director and a controlling
	shareholder of SUNPEC) and 36% in aggregate by the Vendors as at the
	date of this announcement
“Oilfield Block 2104”	an onshore block of land of approximately 20,100 square kilometers in the
	Republic of Madagascar for oil and gas exploitation and operation
“OMNIS”	Office Des mines Nationales Et Des Industries Strategiques, (English
	translation being: The National Office for Mining and Strategic Industries)
	a state-owned agency of Madagascar commissioned to manage and oversee
	the national petroleum and mineral resources of Madagascar

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“Production Sharing	the Production Sharing Contract dated 7 October 2005 entered into between
Contract”	MPIL and OMNIS, pursuant to which MPIL was granted certain oil and gas
	exploration, exploitation and operation rights and profit sharing right at
	Oilfield Block 2104
“Purchaser”	Rich Theme Holdings Limited, a wholly-owned subsidiary of SUNPEC
“Sale”	the sale of the Sale Shares by the Vendors to the Purchaser
“Sale Shares”	an aggregate of 360 ordinary shares of US$1.00 each in the share capital of
	MPIL, which represent 36% equity interest of MPIL and are, as at the date
	of this announcement, owned as to 105 shares by Dorson Group Limited,
	105 shares by Hopestar Group Limited and 150 shares by Dormer Group
	Limited, respectively
“SGM”	a special general meeting of the Company to be convened and held for
	approving, among other matters, the Sale
“Share(s)”	the share(s) of HK$0.01 each in the capital of the Company
“Shareholder(s)”	the holder(s) of the Shares
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“subsidiary”	has the meaning ascribed to it under the Listing Rules
“SUNPEC”	Sino Union Petroleum & Chemical International Limited, the shares of
	which are traded on the Stock Exchange with the stock code: 00346
“SUNPEC Group”	SUNPEC and its subsidiaries (including the Purchaser)
“SUNPEC Shares”	the share(s) of HK$0.02 each in the capital of SUNPEC
“Vendors”	Dorson Group Limited, Hopestar Group Limited and Dormer Group
	Limited, all of which are wholly-owned subsidiaries of the Company

By order of the Board Smart Rich Energy Finance (Holdings) Limited Tam Wai Keung, Billy Vice President

Hong Kong, 22 April 2008

As at the date of this announcement, the Board comprises Mr. Wong Kam Fu, Dr. Lew Mon Hung, Mr. Tam Wai Keung, Billy, Mr. Wah Wang Kei, Jackie, Mr. Wong Hong Loong and Mr. Sin Chi Keung, Mega as executive Directors and Mr. Wong Che Man, Eddy, Mr. Tang King Fai and Mr. Dai Zhongcheng as independent non-executive Directors.

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