possible third party, its happening, page-25

Here is Kalahari's latest release just posted.

Its China!

?2.90 per Kalahari share sounds a bit low to me- wonder if the institutionals will push for a higher price of above ?3.00- or if another bidder (ARMZ maybe) will up the ante?
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NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

7 March 2011

CGNPC URANIUM RESOURCES CO., LTD. (?CGNPC-URC?)

POSSIBLE RECOMMENDED CASH OFFER FOR KALAHARI MINERALS PLC (?Kalahari?)

THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN ANNOUNCEMENT OF A FIRM INTENTION TO MAKE AN OFFER UNDER RULE 2.5 OF THE CITY CODE. THERE CAN BE NO CERTAINTY THAT ANY OFFER WILL ULTIMATELY BE MADE.

Summary

? The CGNPC-URC Board and the Kalahari Board are pleased to announce that they are in discussions regarding a possible recommended cash offer by CGNPC-URC or a subsidiary undertaking of CGNPC-URC for the entire issued and to be issued share capital of Kalahari (the ?Possible Offer?).

? CGNPC-URC, a state-owned enterprise in the PRC, has established strong relationships with domestic and overseas manufacturers and suppliers of natural uranium. An acquisition of Kalahari is therefore in line with its ongoing strategy to support development of important new sources of natural uranium supply.

? The Possible Offer will comprise 290 pence in cash for each Kalahari Share (the ?Offer Price?), valuing Kalahari's fully diluted share capital, including shares attributable to the Options and Convertible Loan Notes, at approximately ?756 million.

? The Possible Offer is at an attractive price and represents a premium of approximately:

o 11 per cent to the Closing Price of 260.25 pence per Kalahari Share on 4 March 2011, being the latest practicable Business Day prior to the commencement of the Offer Period;

o 21 per cent to the Closing Price of 239.75 pence per Kalahari Share on 18 February 2011, being the latest practicable Business Day prior to the announcement by Extract Resources Ltd (?Extract?) (in which Kalahari has a 42.79 per cent shareholding) that it was in discussions regarding a potential combination of Extract's Husab Uranium Project and Rio Tinto's R?ssing Uranium Mine; and

o 38 per cent to the average Closing Price of 209.7 pence per Kalahari Share for the six months prior to and including 4 March 2011, being the latest practicable Business Day prior to the commencement of the Offer Period.

? The Possible Offer is subject to a number of Pre-Conditions including certain regulatory clearances from the authorities in China and Australia as well as finalising the financing to the standards required by the City Code. CGNPC-URC reserves the right to waive any of the Pre-Conditions and, with the consent of the Panel, make any Pre-Condition set out in this announcement a condition to any formal offer.

? CGNPC-URC intends to engage with the Australian Securities and Investments Commission (?ASIC?) prior to any Rule 2.5 Announcement, to confirm that any offer under Rule 2.5 of the City Code is in compliance with the Australian Corporations Act. CGNPC-URC will seek relief from ASIC to acquire a relevant interest in more than 20 per cent of Extract on a basis agreed between CGNPC-URC and ASIC.

? The Kalahari Board has indicated to the CGNPC-URC Board that should a firm intention to make an offer under Rule 2.5 of the City Code be made on the terms of the Possible Offer, the Kalahari Board intends to recommend that Kalahari?s shareholders accept such offer.

? To demonstrate their commitment to the Possible Offer, CGNPC-URC and Kalahari have entered into the Implementation Agreement providing certain assurances and confirmations between the parties, including mutual break fees.

? CGNPC-URC has received irrevocable undertakings from each member of the Kalahari Board (other than Takashi Yasuda who does not own any shares) to accept the Possible Offer upon it being made, subject to there being no Superior Proposal representing an improvement of 5.0 per cent to the value of the consideration under the Possible Offer, in respect of their entire holdings of Kalahari Shares including an offer for their Options (being, in aggregate 19,549,006 Kalahari Shares which represent approximately 7.3 per cent of the fully diluted share capital of Kalahari).

Commenting on the Possible Offer, Zhiping Yu, CGNPC-URC's Managing Director said:

?We are delighted to have secured the support of the Kalahari Board, as we believe this highlights both the attractive value of the Possible Offer and CGNPC-URC's status as an excellent partner for the future development of the Husab Uranium Project.?

Commenting on the Possible Offer, Mark Hohnen, Kalahari's Executive Chairman said:

?The Kalahari Board has considered the Possible Offer from CGNPC-URC carefully in the context of other opportunities available to Kalahari and the Kalahari Board believes this represents attractive value for Kalahari Shareholders. If made, the Possible Offer would enable Kalahari Shareholders to crystallise this value now, in cash. CGNPC-URC's core business activities are centred on the management and supply of nuclear fuels for its parent, CGNPC, establishing interests in and supporting the development of commercial resources and reserves of natural uranium. The Kalahari Board believes this pre-eminent position in the uranium sector makes CGNPC-URC a suitable partner for the realisation of the full potential of the Husab Uranium Project to the benefit of all stakeholders.?

This summary should be read in conjunction with, and is subject to, the full text of the following announcement (including its appendices)

Enquiries:

Deutsche Bank (Financial adviser to CGNPC-URC)


Omar Faruqui

Geoff Tarrant

Pei-Shen Chou
Tel: +44 20 7545 8000

Tel: +61 28258 1231

Tel: +852 2203 8888




College Hill (Public Relations adviser to CGNPC-URC)


Simon Whitehead

Tony Friend

Anne Pang

Ellena Cheung

Louise Watson (Symbol Strategic)
Tel: +44 20 7457 2020



Tel: +852 3791 2287



Tel: +61 28079 2970




Kalahari


Mark Hohnen

Neil MacLachlan
Tel: +44 20 7292 9110




Ambrian Partners Limited (Joint Financial and Rule 3 adviser to Kalahari)


Richard Chase

Samantha Harrison
Tel: +44 20 7634 4700



Azure Capital (Lead Financial Adviser to Kalahari)


Geoff Rasmussen
Tel: +61 8 6263 0888




Strand Hanson Limited (Nominated Adviser to Kalahari)




Simon Raggett

Stuart Faulkner

Rory Murphy
Tel: +44 20 7409 3494



St Brides Media & Finance Ltd (Public Relations adviser to Kalahari)


Hugo de Salis

Susie Geliher
Tel: +44 20 723 1177




This announcement does not amount to a firm intention to make an offer under Rule 2.5 of the City Code. There can be no certainty that any offer will ultimately be made even if the Pre-Conditions are satisfied or waived.

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