Persistence Gold Group Ltd — Capital/Financing Update 2007

Feb 21, 2007

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.

APAC RESOURCES LIMITED

( *)

(Incorporated in Bermuda with limited liability)

(Stock code: 1104)

VERY SUBSTANTIAL ACQUISITION AND CONNECTED TRANSACTION RELATING TO THE ACQUISITION OF 40,125,967 ORDINARY SHARES AND THE CONDITIONAL ACQUISITION OF 19,754,646 ORDINARY SHARES IN MOUNT GIBSON AND RESUMPTION OF TRADING IN THE SHARES

ACQUISITION OF 40,125,967 ORDINARY SHARES IN MOUNT GIBSON

On 6th February, 2007, the Company (through its direct wholly-owned subsidiary, Fortune Desire) acquired an aggregate of 40,125,967 MG Shares, representing approximately 5.09% interest in the issued share capital of Mount Gibson as at 9th February, 2007, through a number of on-market transactions on the Australian Stock Exchange, at an aggregate consideration of A$33,501,170 (equivalent to approximately HK$202,722,279 at approximately A$1.00 to HK$6.0512) (being all at an average price of approximately A$0.8349 per MG Share).

Completion of the Acquisition has taken place on 9th February, 2007 in accordance with the normal clearing and settlement procedures for on-market transactions on the Australian Stock Exchange. The Acquisition was not subject to any condition.

Before the completion of the Acquisition, the Company held 89,702,908 MG Shares, representing approximately 11.39% interest in the issued share capital of Mount Gibson as at 9th February, 2007. After completion of the Acquisition of 40,125,967 MG Shares, the Company held 129,828,875 MG Shares in aggregate, representing approximately 16.48% interest in the issued share capital of Mount Gibson as at 9th February, 2007.

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CONDITIONAL ACQUISITION OF 19,754,646 ORDINARY SHARES IN MOUNT GIBSON

On 9th February, 2007, the Company (through its direct wholly-owned subsidiary, Fortune Desire) entered into the Conditional Acquisition Agreement with the Vendor (a direct wholly-owned subsidiary of Shougang and hence a connected person of the Company), pursuant to which, amongst other things, Fortune Desire as the purchaser, has conditionally agreed to acquire 19,754,646 MG Shares, representing 2.51% interest in the issued share capital of Mount Gibson as at 9th February, 2007, at an aggregate consideration of A$16,791,449.1 (equivalent to HK$102,427,839.51 at A$1.00 to HK$6.10). Completion of the Conditional Acquisition Agreement is conditional upon the fulfilment of certain conditions precedent.

After the completion of the Acquisition but before the Conditional Acquisition, the Company held 129,828,875 MG Shares, representing approximately 16.48% interest in the issued share capital of Mount Gibson as at 9th February, 2007. After completion of the Conditional Acquisition for 19,754,646 MG Shares, the Company will hold 149,583,521 MG Shares in aggregate, representing approximately 18.99% interest in the issued share capital of Mount Gibson as at 9th February, 2007.

LISTING RULES IMPLICATIONS

The transactions contemplated in the Acquisition constitute a major transaction for the Company, on the basis that the calculation of the profits and revenue ratios for the Company are both within the range of 25% and 100%, and is therefore subject to the approval of the Shareholders at the SGM and at which no Shareholder shall abstain from voting. The relevant approval from the Shareholders has not been obtained before completion of the Acquisition which took place on 9th February, 2007.

The transactions contemplated in the Conditional Acquisition constitute a very substantial acquisition and a connected transaction for the Company, on the basis that the transactions contemplated in the Conditional Acquisition have been aggregated (pursuant to Rule 14.23 of the Listing Rules) with the transactions contemplated in the Acquisition which has taken place within twelve months from the date of entering into the Conditional Acquisition of interest in the same company, Mount Gibson, and therefore the calculation of the profit ratio for the Company is over 100% and that the Vendor is a direct wholly-owned subsidiary of Shougang and Shougang is a substantial Shareholder and hence a connected person of the Company, and is therefore subject to the approval of the Independent Shareholders on a vote taken by way of poll at the SGM and at which Shougang and its associates shall abstain from voting.

An independent board committee of the Company has been constituted to consider the terms of the Conditional Acquisition Agreement and to advise and make recommendation to the Independent Shareholders as to how to vote at the SGM on the ordinary resolutions regarding the aforesaid. Mr. Wong Wing Kuen, Albert, Mr. Tsui Robert Che Kwong and Mr. Yang Weiming have been appointed by the Board to serve as members of the independent board committee.

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Independent financial adviser(s) will be appointed to advise the independent board committee of the Company and the Independent Shareholders on the fairness and reasonableness of the transactions contemplated in the Conditional Acquisition Agreement.

GENERAL

The Company will despatch a circular containing, amongst other things, details of (i) the Acquisition; (ii) the Conditional Acquisition Agreement; (iii) the recommendation of the independent board committee of the Company to the Independent Shareholders in respect of the Conditional Acquisition Agreement; (iv) the letter(s) of advice from the independent financial adviser(s) in respect of the terms of the Conditional Acquisition Agreement; and (v) a notice to convene the SGM, to ratify the Acquisition and to approve the Conditional Acquisition and the Conditional Acquisition Agreement as soon as practicable.

SUSPENSION AND RESUMPTION OF TRADING

At the request of the Company, trading in the Shares was suspended with effect from 2:30 p.m. on 8th February, 2007 pending the release of this announcement. An application has been made by the Company to the Stock Exchange for resumption of trading in the Shares with effect from 9:30 a.m. on 21st February, 2007.

THE ACQUISITION

On 6th February, 2007, the Company (through its direct wholly-owned subsidiary, Fortune Desire) acquired an aggregate of 40,125,967 MG Shares, representing approximately 5.09% interest in the issued share capital of Mount Gibson as at 9th February, 2007, through a number of on-market transactions on the Australian Stock Exchange at an aggregate consideration of A$33,501,170 (equivalent to approximately HK$202,722,279 at approximately A$1.00 to HK$6.0512) (being all at an average price of approximately A$0.8349 per MG Share).

Date

6th February, 2007.

Parties

• (1) Various vendors under a number of on-market transactions on the Australian Stock Exchange.

• (2) Fortune Desire as purchaser.

To the best knowledge, information and belief of the Directors, having made all reasonable enquiries, the vendors under such on-market transactions on the Australian Stock Exchange and their ultimate owners are independent third parties not connected with the Company, any of its subsidiaries or any of their respective associates, or any of the connected persons of the Company, any of its subsidiaries or any of their respective associates.

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The MG Shares acquired by the Company

The Company (through its direct wholly-owned subsidiary, Fortune Desire) acquired an aggregate of 40,125,967 MG Shares, representing approximately 5.09% interest in the issued share capital of Mount Gibson as at 9th February, 2007.

Consideration

The aggregate consideration for the Acquisition by the Company (through its direct wholly-owned subsidiary, Fortune Desire) of 40,125,967 MG Shares is A$33,501,170 (equivalent to approximately HK$202,722,279 at approximately A$1.00 to HK$6.0512) (being all at an average price of approximately A$0.8349 per MG Share ranging from A$0.785 to A$0.840 as at 6th February, 2007), and were settled in cash. The consideration was determined by reference to the prevailing trading prices of the MG Shares on the Australian Stock Exchange. The closing price of MG Shares was A$0.79 (equivalent to approximately HK$4.78) as at 6th February, 2007.

Completion

Completion of the Acquisition has taken place on 9th February, 2007 in accordance with the normal clearing and settlement procedures for on-market transactions on the Australian Stock Exchange. The Acquisition was not subject to any condition.

After completion of the Acquisition of the 40,125,967 MG Shares, the Company’s shareholding in Mount Gibson has increased from approximately 11.39% to 16.48% as at 9th February, 2007.

Source of Funding

The Acquisition was financed by margin financing provided by a stock-broking firm, Sun Hung Kai Investment Services Limited (“SHKI”). As at the date of this announcement, the margin financing account has not been settled by the Company. To the best knowledge, information and belief of the Directors having made all reasonable enquiries, SHKI and its ultimate beneficial owners are independent third parties not connected with the Company, any of its subsidiaries or any of their respective associates, or any of the connected persons of the Company, any of its subsidiaries or any of their respective associates.

THE CONDITIONAL ACQUISITION

On 9th February, 2007, the Company (through its direct wholly-owned subsidiary, Fortune Desire) entered into the Conditional Acquisition Agreement with the Vendor (a direct wholly-owned subsidiary of Shougang and hence a connected person of the Company), pursuant to which, among other things, Fortune Desire as the purchaser, has conditionally agreed to acquire 19,754,646 MG Shares, representing approximately 2.51% interest in the issued share capital of Mount Gibson as at 9th February, 2007, at an aggregate consideration of A$16,791,449.1 (equivalent to HK$102,427,839.51 at A$1.00 to HK$6.10).

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The Conditional Acquisition Agreement

Date

9th February, 2007.

Parties

• (1) Timely Rich Limited as the Vendor.

• (2) Fortune Desire as purchaser.

The MG Shares further acquired by the Company

Pursuant to the Conditional Acquisition Agreement, the Company (through its direct wholly-owned subsidiary, Fortune Desire) shall acquire, and the Vendor shall sell, an aggregate of 19,754,646 MG Shares, representing approximately 2.51% interest in the issued share capital of Mount Gibson as at 9th February, 2007.

Conditions precedent

Completion of the Conditional Acquisition Agreement is conditional upon fulfilment of the following conditions:

• (i) the approval by the Independent Shareholders in respect of the Conditional Acquisition Agreement on a vote taken by way of poll at the SGM and at which Shougang and its associates shall abstain from voting in accordance with all applicable requirements under the Listing Rules; and

• (ii) all necessary authorisations being obtained and maintained by Fortune Desire as a result of the transactions contemplated in the Conditional Acquisition Agreement.

Completion

Subject to the fulfilment of the conditions precedent as aforesaid, the completion of the Conditional Acquisition Agreement shall take place at the expiry of five Business Days after all the transactions contemplated in the Conditional Acquisition Agreement have been completed (or such earlier or later date as may be agreed by the Vendor and Fortune Desire in writing).

If any of the conditions is not fulfilled (or waived by Fortune Desire other than condition (i) above which cannot be waived) on or before 31st December, 2007 (or such earlier or later date as may be agreed by the Vendor and Fortune Desire in writing), the Conditional Acquisition Agreement shall cease and determine and the Company shall have no obligations and liabilities under the Conditional Acquisition Agreement save for any antecedent breaches under the terms of the Conditional Acquisition Agreement.

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Consideration

The consideration payable by Fortune Desire for the Conditional Acquisition is HK$102,427,839.51 being A$0.85 per MG Share (at an exchange rate of A$1.00 to HK$6.1).

The consideration payable by Fortune Desire pursuant to the Conditional Acquisition Agreement has been paid as to HK$40,971,135.80 upon execution of the Conditional Acquisition Agreement as deposit and the balance in the sum of HK$61,456,703.71 shall be paid at the expiry of five Business Days after all the transactions contemplated under the Conditional Acquisition Agreement have been completed, provided that the parties thereto may agree to an extension for a further period at such term(s) as agreed by the parties thereto. If the conditions precedent as aforesaid are not fulfilled pursuant to the terms of the Conditional Acquisition Agreement, the deposit in the sum of HK$40,971,135.80 shall be refunded to Fortune Desire forthwith.

The consideration is arrived at after arm’s length negotiation between Fortune Desire and the Vendor and with reference to the prevailing market price of MG Shares traded on the Australian Stock Exchange.

The consideration of the 19,754,646 MG Shares at A$0.85 per MG Share represents (i) a premium of approximately 6.25% over the average closing price of the MG Share (i.e. A$0.80 per MG Share) quoted on the Australian Stock Exchange on the last 5 full trading days up to and including 8th February, 2007; and (ii) a premium of approximately 9.68% over the closing price of the MG Share (i.e. A$0.775 per MG Share) quoted on the Australian Stock Exchange on 9th February, 2007.

Given the potential iron ore production growth of Mount Gibson in the emerging Midwest region of Western Australia combined with being an unique opportunity to secure a strategic foothold in the Australian natural resources sector, the Directors consider that it is reasonable and in the interests of the Company as a whole, to purchase a substantial strategic shareholding of listed shares in Mount Gibson at a price over the then prevailing market price of its shares. To achieve such objective, the Company negotiated on arm’s length with Shougang and decided to purchase the entire block of MG Shares held by Timely Rich at a premium of 6.25% in a bid to build up its substantial strategic shareholding interest in Mount Gibson which is justified for such block lot size of MG Shares.

Source of funding

The payment of the consideration for the Conditional Acquisition will be financed by internal resources including part of the proceeds from the previous rights issue of the Company completed on or about 1st February, 2007 and part of the proceeds from the placing of new Shares to be completed by 3rd March, 2007 (the “Placing”), details of which have been disclosed in the Previous Circular. Subject to the Stock Exchange granting or agreeing to grant the listing of, and the permission to deal in, the new Shares pursuant to the Placing (the “Placing Shares”), the Placing Shares have been fully placed out and transactions contemplated therein have been scheduled to be completed on or before 28th February, 2007, the respective results of the Placing will be announced by the Company accordingly.

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INFORMATION ON MOUNT GIBSON

Mount Gibson is a company incorporated in Australia with limited liability in 1996. Its MG Shares are listed on the Australian Stock Exchange.

The principal business of Mount Gibson is mining of hematite iron ore deposits at Tallering Peak and Koolan Island and exploration and development of hematite iron ore deposits in the Midwest region of Western Australia. Mount Gibson is a specialist iron ore exploration company which owns iron ore deposits and holds mining rights. Mount Gibson currently exports all its current iron ore materials from its operations located at Tallering Peak and Koolan Island to Asia.

The audited financial information of Mount Gibson for the two years ended 30 June 2006 and 2005 are as follows:

			Year ended	Year ended 30
			30 June 2006	June 2005
			Audited	Audited
			A$	A$
Net	assets	value	$97,420,000	$67,629,000
Net	Profit	before taxation and minority interest	$16,151,000	$22,032,000
Net	Profit	after taxation and minority interest	$23,479,000	$13,502,000

The Company confirmed that no dividends had been paid or declared and no recommendation had been made as to dividends for the past three years for Mount Gibson.

As disclosed in the Previous Circular, Mount Gibson had on 24th July, 2006 announced its intention to make a scrip takeover offer (“Mount Gibson Offer”) for Aztec Resources Limited (“Aztec”) by proposing to offer one new Mount Gibson share for every three shares held in Aztec valuing each Aztec share at A$0.263 based on the Mount Gibson volume weighted average price on 21 July 2006 of A$0.789, being the last trading day before announcement of the Mount Gibson Offer. The date of the Mount Gibson Offer was 28th August, 2006.

In November 2006, the Group held an aggregate 84,000,000 shares in Aztec which were held in its short term trading portfolio and were subsequently converted into 28,000,000 MG Shares on 28th November, 2006 pursuant to the Mount Gibson Offer which had been disclosed in the Previous Circular, representing approximately 3.56% interest in the issued share capital of Mount Gibson as at 9th February, 2007.

In January 2007, the Group held an aggregate 39,689,135 shares in Aztec which were compulsorily acquired by Mount Gibson on 6th February, 2007 and accordingly such shares in Aztec converted into 13,229,711 MG Shares pursuant to the Mount Gibson Offer, representing approximately 1.68% interest in the issued share capital of Mount Gibson as at 9th February, 2007.

As at the date of this announcement and as a result of the compulsory acquisition of the Group’s Aztec shares pursuant to the Mount Gibson Offer, the Group’s investment in Aztec which was held in its short term trading portfolio, has been compulsorily acquired and

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converted into 13,229,711 MG Shares as at 9th February, 2007, representing approximately 1.68% interest in the issued share capital of Mount Gibson as at 9th February, 2007. The Group’s investments in Aztec shares, which totalled 123,689,135 in aggregate, and which were held in its short term trading portfolio, have now either been converted into MG Shares following the Group’s acceptance of the Mount Gibson Offer or been converted into MG Shares pursuant to the compulsory acquisition process for Aztec. After such conversions, the Group ceases to hold any shares in Aztec.

After the completion of Mount Gibson Offer, Aztec has become a wholly-owned subsidiary of Mount Gibson.

In addition, the Group had acquired 100,000 MG Shares through on-market transactions on the Australian Stock Exchange on 2nd February, 2007, representing approximately 0.01% interest in the issued share capital of Mount Gibson as at 9th February, 2007. On 1st February, 2007, the Group further acquired 48,373,197 MG Shares under a conditional acquisition which had constituted a very substantial acquisition of the Company and subject to the then independent Shareholders’ approval as disclosed in the Company’s announcement dated 9th November 2006 (the “Previous Acquisition”), representing approximately 6.14% interest in the issued share capital of Mount Gibson as at 9th February, 2007. Such approval was obtained at the special general meeting held on 4th January, 2007. Further details were disclosed in the Company’s Previous Circular dated 12th December, 2006 and announcement dated 4th January, 2007. The Group currently holds such investment, (i.e. 48,473,197 MG Shares) for strategic investment purpose and has classified such in the accounts as “Available for Sale Financial Assets” as defined under HKAS39 issued by the HKICPA.

On 6th February 2007, the Group acquired an aggregate of 40,125,967 MG Shares through a number of on-market transactions on the Australian Stock Exchange. The MG Shares from the Acquisition will be held by the Group for strategic investment purpose and will be classified in the accounts as “Available for Sale Financial Assets” as defined under HKAS39 issued by the HKICPA.

As a result of the above and before the Conditional Acquisition, the Group held 129,828,875 MG Shares, representing approximately 16.48% in the issued share capital of Mount Gibson as at 9th February, 2007. Following completion of the Conditional Acquisition, the Group will hold in aggregate 149,583,521 MG Shares, representing approximately 18.99% in the issued share capital of Mount Gibson as at 9th February, 2007. The MG Shares from the Conditional Acquisition will be held by the Group for strategic investment purpose and will be classified in the accounts as “Available for Sale Financial Assets” as defined under HKAS39 issued by the HKICPA.

The Company has the intention of acquiring further investment interests in the resources industry, where returns are maximized for the Shareholders as a whole.

INFORMATION ON THE COMPANY

The Company is incorporated as an exempted company with limited liability in Bermuda under the Companies Act 1981 of Bermuda (as amended). Its securities are listed on the Main Board of the Stock Exchange.

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The Group is principally engaged in (i) trading in base metals and commodities trading portfolio primarily focused on natural resources and related sectors; and (ii) trading in fabric products and other merchandises.

INFORMATION ON FORTUNE DESIRE

Fortune Desire is a company incorporated with limited liability in the British Virgin Islands and a direct wholly-owned subsidiary of the Company. It is a special vehicle set up for investment holding purpose.

INFORMATION ON TIMELY RICH

Timely Rich is a company incorporated with limited liability in Samoa and a direct wholly-owned subsidiary of Shougang. It is principally engaged in investment holding.

REASONS FOR AND BENEFITS OF THE ACQUISITION AND THE CONDITIONAL ACQUISITION

As disclosed in the Previous Circular, the Company had expressed its intention to acquire further interests in the natural resources industries where opportunities arise to make additional investments where returns are maximized for Shareholders, and if necessary to increase shareholding interest in Mount Gibson, apart from the completion of the Previous Acquisition.

Since the Previous Acquisition, the Company has still been on the lookout for good investment opportunities to maximize return for Shareholders. It has always been the intention of the Company to seek to lock in the supply of iron ore materials and to trade in such materials for higher profit. An increase in the shareholding interest in Mount Gibson is an attempt to reinforce the existing business of the Company so that it is in a better position in seeking to assure supply of raw materials for the trading in commodities with a higher profit margin. The Acquisition and the Conditional Acquisition are anticipated to produce higher return on asset with increase in profit and value of the Company to the benefit of the Shareholders as a whole.

The investment in Mount Gibson, being an iron ore exploration and producing company, fits in with the Company’s business strategy, corporate objectives and principal business activities. The Acquisition and the Conditional Acquisition are further attempts to assure the supply of raw iron ore materials for engaging in such physical commodities trading and helps to consolidate the asset and earning bases of the Group.

The Acquisition and the Conditional Acquisition are consistent with the Company’s strategy of seeking geographic regions and commodity markets which it believes present attractive opportunities and where rationalization and consolidation is likely to occur.

In view of current market conditions, the Directors consider that both the Acquisition and the Conditional Acquisition represent a good opportunity for the Company to further increase its investment in the Australian resources sector upon which to build a significant investment and commodities trading company primarily focused on the natural resources and related sectors.

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Having regard to the nature of and the benefits resulting from the Acquisition and the Conditional Acquisition, the Directors believe that the Acquisition and the Conditional Acquisition is fair and reasonable and in the interests of the Shareholders taken as a whole.

LISTING RULES IMPLICATIONS

The transactions contemplated in the Acquisition constitute a major transaction of the Company, on the basis that the calculation of the profits and revenue ratios for the Company are both within the range of 25% and 100%, and is subject to the approval of the Shareholders at the SGM and at which no Shareholder shall abstain from voting. The relevant approval from the Shareholders has not been obtained before completion of the Acquisition which took place on 9th February, 2007.

The transactions contemplated in the Conditional Acquisition constitute a very substantial acquisition and a connected transaction for the Company, on the basis that the transactions contemplated in the Conditional Acquisition have been aggregated (pursuant to Rule 14.23 of the Listing Rules) with the transactions contemplated in the Acquisition which has taken place within twelve months from the date of entering into the Conditional Acquisition of interest in the same company, Mount Gibson, and therefore the calculation of the profit ratio for the Company is over 100% and that the Vendor is a direct wholly-owned subsidiary of Shougang and Shougang is a substantial Shareholder and hence a connected person of the Company, and is therefore subject to the approval of the Independent Shareholders on a vote taken by way of poll at the SGM and at which Shougang and its associates shall abstain from voting.

An independent board committee of the Company has been constituted to consider the terms of the Conditional Acquisition Agreement and to advise and make recommendation to the Independent Shareholders as to how to vote at the SGM on the ordinary resolutions regarding the aforesaid. Mr. Wong Wing Kuen, Albert, Mr. Tsui Robert Che Kwong and Mr. Yang Weiming have been appointed by the board of Directors to serve as members of the independent board committee.

Independent financial adviser(s) will be appointed to advise the independent board committee of the Company and the Independent Shareholders on the fairness and reasonableness of the transactions contemplated in the Conditional Acquisition Agreement.

GENERAL

The Company will despatch a circular containing, amongst other things, details of (i) the Acquisition; (ii) the Conditional Acquisition Agreement; (iii) the recommendation of the independent board committee of the Company to the Independent Shareholders in respect of the Conditional Acquisition Agreement; (iv) the letter(s) of advice from the independent financial adviser(s) in respect of the terms of the Conditional Acquisition Agreement; and (v) a notice to convene the SGM, to ratify the Acquisition and to approve the Conditional Acquisition and the Conditional Acquisition Agreement as soon as practicable.

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SUSPENSION AND RESUMPTION OF TRADING

At the request of the Company, trading in the Shares was suspended with effect from 2:30 p.m. on 8th February, 2007 pending the release of this announcement. An application has been made by the Company to the Stock Exchange for resumption of trading in the Shares with effect from 9:30 a.m. on 21st February, 2007.

DEFINITIONS

“A$”	Australian dollars, the lawful currency of Australia
“Acquisition”	the acquisition of an aggregate of 40,125,967 MG Shares by
	Fortune Desire through a number of on-market transactions on
	the Australian Stock Exchange at an aggregate consideration of
	A$33,501,170 (equivalent to approximately HK$202,722,279 at
	approximately A$1.00 to HK$6.0512)
“associates”	having the meaning ascribed to it in the Listing Rules
“Australian Stock	The Australian Stock Exchange Limited
Exchange”
“Company”	APAC Resources Limited, a company incorporated in Bermuda
	with limited liability, with its securities listed on the Main Board
	of the Stock Exchange
“Conditional	the conditional acquisition of the 19,754,646 MG Shares,
Acquisition”	representing approximately 2.51% interest in Mount Gibson as at
	9th February, 2007 by Fortune Desire pursuant to the terms and
	conditions of the Conditional Acquisition Agreement
“Conditional	the conditional sale and purchase agreement dated 9th February,
Acquisition	2007 entered into between Fortune Desire and the Vendor relating
Agreement”	to the sale and purchase of the 19,754,646 MG Shares
“Directors”	the directors of the Company
“Fortune Desire”	Fortune Desire Investments Limited, a company incorporated in
	the British Virgin Islands with limited liability and a direct
	wholly-owned subsidiary of the Company
“Group”	the Company and its subsidiaries
“HKAS”	Hong Kong Accounting Standards issued by the HKICPA
“HKICPA”	Hong Kong Institute of Public Certified Accountants
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“Independent	Shareholders (other than Shougang and its associates) who are
Shareholders”	not required under the Listing Rules to abstain from voting at the
	SGM to approve the Conditional Acquisition, the Conditional
	Acquisition Agreement and the transactions contemplated therein
“Listing Rules”	Rules Governing the Listing of Securities on The Stock Exchange
	of Hong Kong Limited

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“MG Shares”	ordinary shares in the issued share capital of Mount Gibson
“Mount Gibson”	Mount Gibson Iron Limited, a corporation incorporated under the
	laws of Australia, with its shares listed on the Australian Stock
	Exchange
“Previous Circular”	the circular dated 12th December, 2006 of the Company in
	respect of, amongst other things, a very substantial acquisition
	for the Company relating to the conditional acquisition of
	48,373,197 MG Shares
“SGM”	the special general meeting of the Shareholders of the Company
	to be convened at 10:00 a.m. on Friday, 30 March, 2007 for the
	purposes of considering and, if thought fit, approving and
	ratifying, amongst other things, the Acquisition, the Conditional
	Acquisition and the Conditional Acquisition Agreement
“Shareholders”	shareholders of the Company
“Share(s)”	ordinary share(s) of HK$0.10 each in the issued share capital of
	the Company
“Shougang”	Shougang Holding (Hong Kong) Limited, a private company
	incorporated with limited liability in Hong Kong. As at the date
	of this announcement, Shougang was interested in 600,000,000
	Shares, representing approximately 23.83% of the existing issued
	share capital of the Company
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Timely Rich”	Timely Rich Limited, a company incorporated in Samoa with
	limited liability and a direct wholly-owned subsidiary of
	Shougang
“Vendor”	Timely Rich

By Order of the Board APAC RESOURCES LIMITED Yue Jialin Chairman

Hong Kong, 16th February, 2007

As at the date of this announcement, the board of Directors comprises Mr. Yue Jialin (Chairman), Mr. Lau Yau Cheung (Chief Executive Officer), Mr. Michael Joseph Bogue being the executive Directors and Mr. Wong Wing Kuen, Albert, Mr. Tsui Robert Che Kwong and Mr. Yang Weiming being the independent non-executive Directors.

* For identification purpose only

Please also refer to the published version of this announcement in The Standard.

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