Prosperity Minerals issue of Notes with Warrants

Prosperity Minerals issue of Notes with Warrants
Published: 06 May 2008

Prosperity which operates a cement manufacturing business in the  People’s Republic of China and an iron ore business serving the same market, today announces the issuance of US$100m Notes with accompanying  Warrants.

Morgan Stanley is acting as arranger for the issuance and the subscription agreement was signed on 2 May 2008 for the issue of the Notes and Warrants to Morgan Stanley and/or certain institutional investors. Completion of the financing will take place on or around 8 May 2008, following which the Notes with Warrants will be issued (the "Issue Date"). The proceeds of the Notes issue will be applied towards funding the Company’s four strategic investments in Chinese cement projects located in Guangdong, Yunnan, Guizhou and Liaoning Provinces.
The Notes will be issued by Upper Value Investments Ltd, a wholly-owned subsidiary of Prosperity, and will be guaranteed by the Company, Prosperity Cement Investment Ltd and Prosperity Materials Macao Commercial Offshore Ltd.

In addition, the Notes will be secured by charges over the shares in, and fixed and floating charges over the assets of Prosperity’s wholly owned subsidiaries which will hold the four strategic investments.
Chairman & CEO David Wong said: "the proceeds from the Notes issue will be invested in the continued expansion of the Group’s cement business, which will add significantly to shareholder value. In addition, the Group is investigating the possibility of a spin-off of the Group’s cement manufacturing business
pursuant to an initial public offering, or dual listing of the Company’s shares, on an appropriate market to further enhance shareholder value."