Bursa Announcements

1.

INTRODUCTION

The Board of Directors would like to announce that Malaysia Smelting Corporation Berhad (“MSC”) has today disposed of its entire shareholding in its 76.91% listed subsidiary, Australia Oriental Minerals NL (AOM) comprising a total of 1,677,545,461 ordinary shares at A$0.0016 per share via an on market special crossing to Messrs Taylor Collison.    

Accordingly, all nominees directors of the Company will step down from the Board of the AOM with immediate effect.

2.

DETAILS OF THE DISPOSAL

2.1

Background

The Company appointed Messrs Taylor Collison, an Australian based sharebrokers and investment advisers on 14 January 2011 to dispose of its entire shareholdings in AOM.  The major investment of AOM at present is Asiatic Coal Pte Ltd (ACPL) which has a coal project in Muara Teweh, Indonesia.  The Company, together with AOM, is also disposing of its interest in ACPL.  This disposal is expected to be completed by end of July 2011.  

2.2

Basis of Arriving at the Purchase Consideration

The consideration for the sale of the entire equity interest in AOM was arrived at on a “willing-buyer willing-seller” basis. 

3.

RATIONALE FOR THE DISPOSAL OF AOM

The proposed disposal of the Company’s interest in AOM is in line with MSC’s corporate objective made in 2009 to focus its core business in tin.

4.

EFFECTS OF THE DISPOSAL OF AOM

The proposed disposal of the Company’s interest in AOM will not have any effect on the share capital of MSC and the shareholdings of the substantial shareholders in MSC.

The disposal will not have any material effect on the net assets and gearing of the MSC Group and on its earnings for the financial year ending 31 December 2011.

5.

UTILISATION OF PROCEEDS

MSC intends to utilise the proceeds from the sale for working capital purposes. 

6.

DEPARTURE FROM THE POLICIES AND GUIDELINES ON ISSUE / OFFER OF SECURITIES OF THE SECURITIES COMMISSION (“SC”) (“SC GUIDELINES”)

To the best of the knowledge of the Board of MSC, the disposal of AOM does not depart from the SC Guidelines. The disposal of AOM does not require the approval of the SC.

7.

DIRECTORS’ AND MAJOR SHAREHOLDERS’ INTERESTS

None of the directors and major shareholders of MSC as well as persons connected with them have any interest, direct and/or indirect, in the disposal of AOM by MSC.

8.

DIRECTORS’ STATEMENT

Having considered the rationale for the disposal of AOM and after due deliberation, the Board of MSC is of the opinion that the proposed disposal is in the best and long-term interest of MSC and its shareholders.