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HENGSHI MINING INVESTMENTS LIMITED

(incorporated in the British Virgin Islands and continued in the Cayman Islands with limited liability)

(Stock Code: 1370) FURTHER CHANGE IN USE OF PROCEEDS

This announcement is made by the board (the "Board") of directors of Hengshi Mining Investments Limited (the "Company", together with its subsidiaries, the "Group") pursuant to Rule 13.09 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Stock Exchange") and Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance (Chapter 571, Laws of Hong Kong).
Reference is made to the prospectus of the Company dated 18 November 2013 (the "Prospectus") relating to the listing of the Company's shares on the Main Board of the Stock Exchange. Reference is also made to the announcement of the Company dated 13 June 2014 (the "Announcement") in relation to the change in use of proceeds from the Global Offering. Unless otherwise defined, capitalised terms used in this announcement shall have the same meanings as defined in the Prospectus and the Announcement.
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The Board hereby announces further change in use of proceeds from the Global Offering (the
"Net Proceeds") in the revised manner as set out below:

Intended use of the Net Proceeds Actual use of the Net Proceeds as at the date of this Announcement Changed use of the Net Proceeds

• approximately 70% of Net Proceeds (approximately HK$790.3 million) will be used to finance our expansion plans as set out in "Business - Production Expansion Plans" of the Prospectus;
approximately HK$683.5 million have been or will be used as intended;
as disclosed in the Announcement, approximately HK$106.8 million (equivalent to approximately RMB84.4 million), which had been intended to build
a wet processing plant in order
to expand processing capacity of Jiheng Mining, had been changed to be used for the acquisition of a wet processing plant being built by Laiyuan County Xiongxin Mining Co., Ltd.;
• approximately 20% of Net Proceeds (approximately HK$225.8 million) will be used for repaying our bank loans with China Construction Bank Corporation Rongcheng Sub-branch in the aggregate amount of RMB200.0 million as described in "Financial Information - Indebtedness"
of the Prospectus;
approximately HK$139.3 million (equivalent to RMB110.0 million) of the Net Proceeds for repaying the bank loans with China Construction Bank Corporation Rongcheng Sub-branch, as set
out under "Financial Information
- Indebtedness" section of the Prospectus, have been used as intended, among which RMB40.0 million were used for repayment of loans due and RMB70.0
million were used for early repayment of loans;
approximately HK$86.5 million will be changed to be used for the Group's potential acquisition of mining assets (effective as at the date of this announcement);
• approximately 10% of Net Proceeds (approximately HK$112.9 million) will be used for working capital and general corporate purposes.
there is no change to the intended use.
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REASONS FOR CHANGE IN USE OF PROCEEDS

In light of the continuing decrease in the price of iron ore, which leads to the withdrawal of small-size iron ore miners from the market, the Board is of the view that the Group is facing an opportunity for the acquisition and integration of high quality assets. In the meantime, considering the overall low debt ratio of the Group, it is beneficial for the sustainable development of the Group business by proactive expansion and maintaining the debt ratio.
Considering the development strategies and the construction schedule of various projects of the Group, as well as the actual financial conditions of the Group, in order to improve the efficiency of the use of proceeds, the Directors are of the view that the above further change in use of proceeds is in the best long-term interest of the Company and its Shareholders as a whole.
By order of the Board

Hengshi Mining Investments Limited Mr. Li Yanjun

Chairman

Beijing, 10 December 2014

As at the date of this announcement, the executive directors of the Company are Mr. Li Yanjun, Mr. Leung Hongying Li Ziwei, Mr. Xia Guoan, Mr. Sun Jianhua, Mr. Huang Kai and Mr. Tu Quanping and the independent non-executive directors of the Company are Mr. Ge Xinjian, Mr. Meng Likun and Mr. Kong Chi Mo.

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