ASX RELEASE 14 May 2014

Aqui l a Ad vi ses Shar e hol der s to T AK E NO AC TI ON Fol l ow i ng Rel ea se of Bi dd er ' s Stateme nt fr om B aoste el and Aur i zon


Aquila Resources Limited (Aquila) has today received a Bidder's Statement from Baosteel Resources Australia Pty Ltd (Baosteel) and Aurizon Operations Limited (Aurizon) (together "the Bidders") containing the terms of a conditional off-market takeover offer for all of the ordinary shares in Aquila that they (and their associates) do not already own at a price of
$3.40 cash per share (Offer).
A copy of the Bidder's Statement is expected to be sent to Aquila shareholders by the Bidders before the end of May. The Offer will be required to be open for acceptances for at least one month after its dispatch to Aquila shareholders. As such, the Offer will be open for acceptance until at least late June 2014.
Given the Bidders still require FIRB approval, it seems likely that the offer period could be extended.
As Baosteel has a representative on the Aquila Board, as is customary good corporate governance, Aquila has formed an independent Board sub-committee (IBC) comprising the non Baosteel members of the Board to consider the Offer. The IBC will carefully review the Bidder's Statement and respond formally through a Target's Statement in sufficient time for all shareholders to make an informed decision in relation to the current Offer.
To assist the IBC, we have appointed Goldman Sachs as financial advisor and King & Wood Mallesons as legal advisor. We have also appointed an independent expert to report on the Offer in light of Baosteel's pre-existing Board representation.

The Independent Expert's Report and the recommendation of the members of the IBC on whether to accept or reject the offer will be clearly set out in the Target's Statement.

Until the IBC provides shareholders with a formal recommendation, shareholders are advised to TAKE NO ACTION regarding the Offer.

Aquila will continue to keep you informed of further material developments concerning the
Offer as appropriate.
Yours sincerely,

Tony Poli Executive Chairman

For further information, please contact:

Aquila

Goldman Sachs

Tony Poli (Executive Chairman and CEO) / Martin Alciaturi (General Manager - Finance

and Corporate)

Telephone: (08) 9423 0111

Facsimile: (08) 9423 0133

Peter Watson (Executive Director) Telephone: (08) 9218 1000

Facsimile: (08) 9218 1010

Perth: Level 2 Aquila Centre, 1 Preston Street, Como WA 6152 Telephone (61) 8 9423 0111 Facsimile (61) 8 9423 0133 Brisbane: Level 18, 10 Eagle Street, Brisbane QLD 4000 Telephone (61) 7 3229 5630 Facsimile (61) 7 3229 5631 Johannesburg: Block C, Ground Floor, 28 Sloane Street, Bryanston 2191, Gauteng, South Africa (27) 11 4631340 Facsimile (27) 11 4635083
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