GRANGE RESOURCES LIMITED. — M&A Activity 2003

Sep 7, 2003

By $m_7$ , 1900 999

8.SEP.2003 16:26

ASX Announcement Monday 3 September 2003 Selwyn Mines Limited (Receivers and Managers Appointed)

Takeover Bid and Deeds of Company Arrangement

The Directors of Selwyn Mines Limited (ASX Code SLN), ("Selwyn") have received a takeover proposal (Proposal) from Hillgrove Gold Limited (ASX Code HGO) and Grange Resources Limited (ASX Code GRR) conditional upon the execution of certain deeds of company arrangement and a 90% minimum acceptance by Selwyn shareholders (see announcement by HGO and GRR dated 6 September 2003).

The Proposal places a market value on the Selwyn exploration and mining tenements of \$11.3 million. This value is to be realised under certain deeds of company arrangement. Under the deeds, \$8 million in cash will be available for repayment of debt to BankWest as will the proceeds of the sale of the mining plant, equipment and stores. The liability of BankWest under the environmental bond will also be replaced. The Proposal contemplates the payment of a \$2 million "deposit" to BankWest upon the Receivers and Managers consenting to the implementation of the proposal and BankWest agreeing to vote in favour of the various deeds of company arrangement,

Importantly, the Proposal will result in the Selwyn Companies continuing in existence with their assets intact, The Directors believe that the Proposal will, if implemented, provide a significantly better return to BankWest, the unsecured creditors and the shareholders than any other proposal currently being negotiated by the Receivers and Managers.

The Directors understand that the Receivers and Managers are currently negotiating to sell the Selwyn exploration and mining tenements to a third party, however, no definitive documentation has been entered into. The Directors have requested the Receivers and Managers to confirm the legal status of their negotiations and requested copies of relevant documentation to obtain separate legal advice in the context of considering the Proposal.

Subject to clarification of this issue and a review of the bidder's statement, the directors are prepared to recommend acceptance of the proposal by shareholders.

Tor Ventiurion PLEASE

$J_{\partial N}$ NORTH, (02) 92304148, Director. Me