Takeover Offer for World Titanium Resources Limited

ASX, AIM and Media Release 23 December 2014 BASE RESOURCES LIMITED TAKEOVER OFFER FOR WORLD TITANIUM RESOURCES LIMITED KEY DETAILS * Offer of 1 Base Share for every 5 World Titanium Shares; * Offer represents a significant premium to the traded prices of World Titanium Shares during the period leading up to this announcement; * Subject to limited conditions including a 40% minimum acceptance condition; * Offer already supported (in the absence of a superior proposal) by World Titanium's largest institutional shareholder, JP Morgan Asset Management (UK) Limited, through a pre-bid acceptance agreement; and * On the basis the Offer is successful, Base will secure the Toliara Sands Project to complement its successful Kwale Project and position itself for future growth within the mineral sands industry. Base Resources Limited (ASX & AIM: BSE) ("Base" or the "Company"), the mid-tierEast African mineral sands producer, is pleased to announce an off-markettakeover offer ("Offer") for World Titanium Resources Limited (ASX:WTR) ("WorldTitanium"). The Offer is 1 Base ordinary share ("Base Share") for every 5 World Titaniumordinary shares ("World Titanium Shares"). Based on the ASX closing price of Base Shares on 22 December 2014 of 20.0cents, the Offer values each World Titanium share at 4.0 cents. This representsa 60% premium to the closing price of World Titanium shares on the ASX on thesame date of 2.5 cents. On the basis of the 1, 3 and 6 month volume weighted average prices of theshares traded in both companies on the ASX, the Offer represents premiums of118%, 98% and 56% respectively. The Offer is subject to limited conditions, including (but not limited to): * 40% minimum acceptance; * World Titanium conducting its business in the ordinary course; and * no "prescribed occurrences" happening. Full details of these conditions are set out in Base's Bidder's Statement whichhas been sent to World Titanium and lodged with ASIC today. A copy of theBidder's Statement is available on the Company's website:www.baseresources.com.au and the ASX website. The Offer is supported by World Titanium's largest institutional shareholder,JP Morgan Asset Management (UK) Limited. JP Morgan Asset Management (UK)Limited holds 7.7% of World Titanium and has entered into a pre-bid acceptanceagreement with Base confirming that, in the absence of a superior proposal, itwill accept the Offer within 5 business days of Base declaring itunconditional. Base believes that the support of JP Morgan Asset Management (UK) Limitedshould be seen as an endorsement of the merits in accepting the Offer for allWorld Titanium shareholders. Base notes that all four of the directors of World Titanium are representativesof World Titanium's existing largest shareholders, Boulle Titanium Limited(20.4% interest in World Titanium Shares) and Mineral Deposits Limited (19.1%interest in World Titanium Shares). In these circumstances, it has not beenpractical for Base to engage with the World Titanium board regarding the Offerin advance of this announcement. INDICATIVE TIMETABLE Base expects to send its Bidder's Statement, which will provide moreinformation about the Offer, to World Titanium Shareholders on or around 6January 2015. It is expected that the Offer will become open to acceptances on6 January 2015 and that it will close on 7 February 2015 (unless extended). BENEFITS OF THE OFFER TO WORLD TITANIUM SHAREHOLDERS The directors of Base believe there are very compelling reasons for WorldTitanium shareholders to accept the Offer. In summary: * The Offer represents a significant premium to the market price for World Titanium Shares in the period prior to the announcement of the Offer; * World Titanium shareholders will become shareholders in a mid-tier East African focused mineral sands company which combines the successful Kwale Project in Kenya with the Toliara Sands Project in Madagascar; * World Titanium shareholders will gain exposure to the Base board and management team who have demonstrated their ability to deliver the successful Kwale Project; * World Titanium shareholders will become shareholders in a company which is capable of driving the development of the Toliara Sands Project, including arranging the required financing; * The Offer is already supported by World Titanium's largest institutional shareholder, JP Morgan Asset Management (UK) Limited; and * World Titanium shareholders will have access to a more liquid market for their holding. ABOUT WORLD TITANIUM World Titanium is an Australian incorporated ASX listed mineral sands companyand as at 22 December 2014 had a market capitalisation of $9.0 million. World Titanium's core focus is the exploration and evaluation of its 100% ownedToliara Sands Project in Madagascar. Based on publically available information, the substantial shareholders ofWorld Titanium are: SHAREHOLDER SHARES INTEREST Boulle Titanium Limited 73,725,060 20.4% Mineral Deposits Limited 69,138,124 19.1% JP Morgan Asset Management (UK) Limited 28,032,234 7.7% Blakeney LLP 25,586,488 7.1% BASE'S INTENTIONS Base is seeking to acquire World Titanium to secure ownership of the ToliaraSands Project. Through obtaining outright ownership or effective control of World Titanium,Base will extend its mineral sands project interests and diversify its projectand geographical risk profiles. On securing control, Base would intend to initially explore the developmentoptions for the Toliara Sands Project and progress development on a timelinethat is responsive to market conditions. IMPACT OF THE OFFER ON BASE The successful acquisition, or the securing of effective control, of WorldTitanium will result in Base becoming a larger East African-focused mineralsands player with: * a producing operation in Kenya with one of the highest revenue to cash cost ratios in the sector (Kwale Project); * a well-recognised development project in Madagascar (Toliara Sands Project); * an experienced board and management team with recent success in the financing and progression through to production of a significant mineral sands project in Africa; * a strong institutional shareholder base including a number of specialist global resource sector investment funds; and * Increased scale, market relevance and trading liquidity, with listings on both the ASX and the AIM market in London, positioning the Base Group to access ongoing institutional shareholder support to drive future growth. On successful completion of the Offer, World Titanium Shareholders willtogether hold approximately 11.4% of Base and will therefore retain exposure toWorld Titanium's Toliara Sands Project, while also enjoying the benefits ofbeing a shareholder in an emerging mineral sands producer with a solid trackrecord of achievement. Commenting on today's announcement, Managing Director, Tim Carstens said; `TheToliara Sands Project in Madagascar is a well-recognised large scale, highgrade development opportunity. The success of the Kwale Mineral Sands operationprovides a model and platform to bring an additional asset into our portfoliothat presents us with a clear growth path in line with our strategy forbuilding a sustainable and globally significant resources company." ADVISERS Base's corporate adviser on the Offer is RFC Ambrian Limited and its legaladviser is King & Wood Mallesons. A full PDF version of this announcement and the Bidders Statement is availablefrom www.asx.com.au and on the Company's website at www.baseresources.com.au. For further enquiries contact:Base Resources Limited RFC Ambrian LimitedTim Carstens Stephen AllenManaging Director Executive DirectorPhone: +61 (0)8 9413 7400 Phone: +61 (0)8 9480 2500 RFC Ambrian Limited (Nominated Adviser and Broker)As Nominated Adviser As BrokerAndrew Thomson or Trinity McIntyre Jonathan WilliamsPhone: +61 (0)8 9480 2500 Phone: +44 20 3440 6800 Africapractice (East Africa) (Kenyan Media Relations)David Maingi/ James Njuguna/Joan KimaniPhone: +254 (0)20 239 6899Email: [email protected] Tavistock Communications (UK Media Relations)Jos Simson / Emily Fenton / Nuala GallagherPhone: +44 (0) 207 920 3150 Cannings Purple (Australian Media Relations)Annette Ellis / Warrick HazeldineEmail: [email protected]@canningspurple.com.auPhone: +61 (0)8 6314 6300 Corporate Details: Board of Directors:Andrew King Non-Executive ChairmanTim Carstens Managing DirectorColin Bwye Executive DirectorSam Willis Non-Executive DirectorMichael Anderson Non-Executive DirectorMike Stirzaker Non-Executive DirectorMalcolm Macpherson Non-Executive DirectorWinton Willesee Company Secretary Principal & Registered Office: Contacts:Level 1 Email: [email protected] Kings Park Road Phone: +61 (0)8 9413 7400West Perth Fax: +61 (0)8 9322 8912WA 6005