CITIC PACIFIC

PRESS RELEASE

16April2014

CITIC Pacific to Acquire 100 Percent of CITIC Limited

• Provides CITIC Pacific shareholders with direct exposure to China's largest,most prestigious and pioneering multi-industry conglomerate

• Expands the breadth and scale of CITIC Pacific's businesses;improves its profitability and enlarges its capitai base

• 28.5% CITIC Pacific shareholder value accretion with EPS from continuing operations increasing from HK$1.51 to HK$1.94 post-acquisition

CITIC Pacific (the "Company'') today signed a share transfer agreement with CITIC Group to acquire

100% of CITIC Limited, the main operating entity of CITIC Group, for RMB227 billion (HK$287 billion). The acquisition is subject to independent shareholder approvai at an Extraordinary GeneraiMeeting and approvai from relevant regulatory bodies.

Consideration and Funding

The acquisition price was negotiated by the parties at arm's length and takes into account the current and future business and operational prospects of CITIC Pacific and CITIC Limited, and a valuation by an independent valuer (stili pending approvai by the Ministry of Finance of the PRC). The Board of CITIC Pacific believes that the price represents fair and reasonable value.

CITIC Pacific will fund the acquisition primarily through the issuance of new shares to CITIC Group and to institutional investors:

Shares to CITIC Group

The proposed value of new shares to be issued to CITIC Group amounts to RMB177 billion

(HK$223 billion) which equates to 16,579 million shares.

The new shares shall be priced at HK$13.48 per share,a premium of 25.86% to the average closing price of CITIC Pacific's shares for the last 60 days up to and including the pricing date (24 March, 2014), being the last trading day before the Company announced that it was in discussions with CITIC Group regarding this acquisition.

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Such proposed value and number of new shares may increase, but subject to maintaining the public free float between 15%- 25%.

Shares to institutional investors

New shares to be issued to institutional investors, together with shares to be issued to
CITIC Group, shall not exceed 21,254 million shares.
The proposed value of new shares to be issued to institutional investors is RMBSO billion
(HK$63 billion).
The new shares shall be priced at not less than the higher of HK$13.48 per share and 80% of the closing price of CITIC Pacific shares an the last trading day prior to the relevant placing agreement.
The number of shares to be issued to institutional investors is subject to adjustment and will depend on a number of considerations.

Chang Zhenming, Chairman of CITIC Pacific, said: "l am delighted to announce this exciting investment opportunity for our shareholders. For the first time ever,CITIC Pacific investors will have access to China's largest, most prestigious and pioneering conglomerate. CITIC has always been right at the heart of the process of reform and development in China and this landmark transaction marks the next stage of the Group's transformation. CITIC has a track record of outperforming China's growth and aligning its businesses to benefit from China's development. The enlarged entity will be even better positioned to capitalise an the next phase of China's development and we are excited by what the future holds:'

"This is a transformational transaction for CITIC Pacific and we will become much bigger, with better earnings visibility and enhanced shareholder return. We will also become more diverse to protect that profitability and return. Hong Kong has been the home of our business for nearly three decades and its infrastructure, best practice incorporate governance, access to international capitai markets and strong talent pool has served CITIC Pacific well. l am confident this is an exciting opportunity forali CITIC Pacific shareholders and also for CITIC Limited's businesses. They will benefit from sitting within the robust framework CITIC Pacific has worked hard to create;' Chang Zhenming added.

Reasons for and Benefits of the Acquisition Expands CITIC Pacific's breadth and scale and improves its overall competitiveness

Acquires a business that has demonstrated sustained, strong financial performance Provides CITIC Pacific with a diverse set of businesses, including financial services, resources and energy, manufacturing, real estate and infrastructure, engineering contracting and others, many ofthem are with leading positions in theirfield
Expands CITIC Pacific's net assets by aver 4 times
Enables CITIC Pacific to be better positioned to capture growth opportunities in China due to greater size, scale and breadth

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Enhances CITIC Pacific's earninqs profile and increases shareholder value

Provides CITIC Pacific with greater stability in its operational and financial performances lncreases CITIC Pacific's net profit: unaudited pro forma net profit attributable to ordinary shareholders would have been HK$48,430 million, if the transaction had been completed by 31 December, 2013 (CITIC Pacific alone: HK$7,588 million)
Enhances CITIC Pacific's shareholder value: if the transaction had been completed by 31
December, 2013, the unaudited pro forma earnings per share from continuing operations of the enlarged entity would have been HK$1.94, representing a 28.5% increase, while return on equity would have risento 13% from 9%

Strengthens CITIC Pacific's capitai base and enhances its financinq capabilities and flexibility

CITIC Pacific's credit rating (currently Ba2 and BB) is expected to improve (currently CITIC Group's rating is Baa2 and BBB+)
Enhances CITIC Pacific's debt financing capabilities enabling the Company to continue funding capitai intensive projects
lncreases CITIC Pacific's total market capitalisation and raises the Company's position amongst Hang Seng lndex companies;provides shareholders with increased liquidity

Creates further synerqies

Provides CITIC Pacific with further synergies through shared business networks, customer base, government relationships and other resources
CITIC Pacific and CITIC Limited's complementary businesses, such as real estate and
resources and energy, will benefit from being part ofthe same group

Shared corporate culture encouraqes effective inteqration

Expects effective integration due to history of shared management and cross-business collaboration, shared corporate values and vision

lndependent and Fair Process for CITIC Pacific's Shareholders

CITIC Pacific will form an independent board committee, comprising the Company's lndependent Non-Executive Directors, to make a recommendation to CITIC Pacific's independent shareholders in relation to this acquisition. An independent financial adviser will also be appointed to advise the independent board committee.
As soon as practicable, and no later than 14 May, 2014, CITIC Pacific will despatch a circular to shareholders containing further details of the acquisition, the recommendation to shareholders from the independent board committee, and the recommendation from the independent financial adviser. CITIC Pacific will hold an EGM on 03 June, 2014 where shareholders will be asked to vote to approve the acquisition and the proposed issue of new shares to CITIC Group and to institutional investors to fund the acquisition.

For further information, pleose refer to the full onnouncement filed on the Hong Kong Stock Exchonge and transaction dea/ s it e ot htt p : // www. c iti coppo rtunit y . co m.

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About CITIC Pacific:

CITIC Pacific Limited (267.HK), listed in Hong Kong, is a constituent of the Hang Seng lndex, and is

57.5% owned by CITIC Group. lt is a diversified company with its main businesses in special steel, iron ore and property development in mainland China. lts businesses embrace world-class technology and strive for international best practices. CITIC Pacific is strongly committed to long­ term business success and lasting shareholder value.

About CITIC Limited:

CITIC Group is the largest multi-industry conglomerate in China,with businesses covering financial services, resources and energy, manufacturing, real estate and infrastructure, engineering contracting and a number of other sectors. CITIC Group ranked 172 in the Fortune Global 500 in

2013. CITIC Limited, substantially ali of the assets of CITIC Group, comprises many companies and

businesses that are leaders in their fields.

Media enquiries:

Brunswick Group Ltd (citicpacific@brunswickgroup.com)

MrTim PAYNE

Tel: 852-3512 5066

Mobile: 852-6104 6266 tpayne @ brunswickgroup.com

Mr Joseph LO

Tel: 852-3512 5033

Mobile: 852-9850 50 3 3 jlo @ brunswickgroup.com

MsJoanna DONNE

Tel: 852-3512 5070

Mobile: 852-9221 3930 jdonne@brunswickgroup.com

Ms Crystal CHAN

Tel: 852-3512 5032

Mobile: 852-9669 36 3 2 cchan@brunswickgroup.com

Ms Qian LI

Tel: 852-3512 5000

Mobile: 852-6117 6386 qli@brunswickgroup.com

lmportant Disclaimer

This press re/ease is far information purposes only and does not constitute an offer to acquire, purchase or subscribe for securities referred to in this press release in the United States (including its territories and possessions, any State of the United States, and the District of Columbia) or e/sewhere. The securities referred to herein may not be offered or so/d in the United States absent registration or an exemption from registration under the United Stotes Securities Act of 1933, os omended. There is no intention to register ony securities referred to in this press

re/ease in the United States, orto conduct a public offering of sueh securities in the United States.

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