Press Release

Union Miniere Invests in Padaeng Industry Public Company Limited

Union Miniere, one of the world’s largest zinc producers, has signed an agreement to subscribe to an increase in equity representing a 33% stake in Padaeng Industry Public Company Limited of Thailand, the sole zinc producer in Southeast Asia. The stake is worth approximately Bt 1,0 bn (~US$26.7m). Union Miniere will be the largest shareholder in Padaeng. The completion of this transaction remains subject to the approval by the regulatory authorities.

The strategic investment will be highly beneficial to both companies. Union Miniere will cooperate with Padaeng for operations in the region to distribute and produce its zinc products through Padaeng. Padaeng and Union Miniere will use their respective strengths to position the Thai company as a key player in Asia.

The strategic partners will support their customers with tailor-made products, solutions and services. The strength of the alliance stems from the unique combination of Padaeng’s “upstream” mining and smelting activities and its location in the Asian market with Union Miniere’s expertise in primary and secondary zinc smelting and its experience in value-added “downstream” zinc products.

Union Miniere, through its Business Group Zinc, is one of the world’s largest zinc players with a total sales volume of around 550 000 MT. per year. Union Miniere is committed to international development with a strong emphasis on recycling of end-of-life products, excellence in technology and operations and presence in all downstream applications where zinc adds value and where Union Miniere can make a difference.

Padaeng Industry was established in 1981 and was awarded a 25-year zinc ore mining concession by the Thai government in 1982. Its silicate mine is located in central western Thailand, close to the city of Mae Sot, Tak province. On Jan 1 2000, PDI reported that the Mae Sot mine contains 4.7 million metric tons of proven and probable reserves at 11.3% zinc. An independent report prepared in February 2000 by a worldly renowned consultant confirmed the good potential to increase resources in the current pit and to define extensions to the current resources. The company has a capacity to smelt 100,000 MT.per year of SHG zinc at its refinery at Tak. The Tak plant is partially fed by the Padaeng’s roaster in Rayong with a capacity of 135,000 MT of calcine per year. With all of these operations, Padaeng is the largest zinc player in Southeast Asia. After the difficult years linked to the Asian crisis, Padaeng could report earnings of Bt 152m (~US$4m) in FY 1999, in comparison to a net loss of Bt 314m (~US$8m) in 1998.