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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No.  )
Filed by the Registrant ý
Filed by a Party other than the Registrant o
Check the appropriate box:
o   Preliminary Proxy Statement
o   Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
ý   Definitive Proxy Statement
o   Definitive Additional Materials
o   Soliciting Material Pursuant to §240.14a-12
 
Metal Management, Inc.
(Name of Registrant as Specified In Its Charter)
 
 
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
ý   No fee required.
o   Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
  (1)   Title of each class of securities to which transaction applies:
 
     
     
 
 
  (2)   Aggregate number of securities to which transaction applies:
 
     
     
 
 
  (3)   Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
 
     
     
 
 
  (4)   Proposed maximum aggregate value of transaction:
 
     
     
 
 
  (5)   Total fee paid:
 
     
     
 
o   Fee paid previously with preliminary materials.
 
o   Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
  (1)   Amount Previously Paid:
 
     
     
 
 
  (2)   Form, Schedule or Registration Statement No.:
 
     
     
 
 
  (3)   Filing Party:
 
     
     
 
 
  (4)   Date Filed:
 
     
     
 


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(Metal Management logo)   (SIMS logo)
 
TO THE STOCKHOLDERS OF METAL MANAGEMENT, INC.
 
A MERGER PROPOSAL — YOUR VOTE IS VERY IMPORTANT
 
To the Stockholders of Metal Management, Inc.:
 
You are cordially invited to attend a special meeting of stockholders of Metal Management, Inc., scheduled for March 14, 2008, at 10:00 a.m., local time. At the special meeting, you will be asked to adopt Metal Management’s merger agreement with Sims Group Limited, which is referred to as Sims, dated as of September 24, 2007. In the merger, a wholly owned subsidiary of Sims will be merged with and into Metal Management, with Metal Management surviving the merger and continuing its existence as a wholly owned subsidiary of Sims. The combined company created by the merger will be renamed Sims Metal Management Limited, subject to obtaining shareholders’ approval of the name change after the merger is completed.
 
If the merger is completed, then each share of Metal Management common stock that you own at the effective time of the merger will be converted into the right to receive 2.05 Sims American Depositary Shares, which are referred to as Sims ADSs. Each Sims ADS will represent one ordinary share of Sims. Sims ordinary shares will continue to be listed on the Australian Securities Exchange, and Sims ADSs will be listed on the New York Stock Exchange. It is estimated that immediately after the effective time of the merger, former Metal Management stockholders will hold Sims ADSs representing approximately 30% of the then outstanding Sims ordinary shares. Based upon the shares of Metal Management common stock outstanding on January 25, 2008, Sims will be obligated to issue approximately 53.2 million Sims ADSs in the merger. In addition, Sims may issue up to approximately 1.1 million Sims ADSs pursuant to the exercise of Metal Management options, which will be converted into Sims options upon completion of the merger.
 
The merger cannot be completed unless Metal Management stockholders adopt the merger agreement. The adoption requires the affirmative vote of the holders of a majority of the shares of Metal Management common stock outstanding on January 25, 2008, the record date for the special meeting.
 
The Metal Management board of directors has unanimously approved the merger agreement and the transactions contemplated by the merger agreement and determined the merger is in the best interests of Metal Management and its stockholders. The Metal Management board of directors unanimously recommends that Metal Management stockholders vote “FOR” adoption of the merger agreement.
 
The accompanying proxy statement/prospectus contains detailed information about the merger and the special meeting. This document is also a prospectus for the Sims ordinary shares underlying the Sims ADSs that will be issued in the merger. Metal Management’s stockholders are encouraged to read carefully this proxy statement/prospectus before voting, including the section entitled “Risk Factors” beginning on page 15.
 
Your vote is very important.  Whether or not you plan to attend the Metal Management special meeting, please take the time to vote by completing and mailing the enclosed proxy card or by granting your proxy electronically over the Internet or by telephone. If your shares are held in “street name,” you must instruct your broker in order to vote.
 
We are very excited about the opportunities the proposed merger brings to Metal Management’s stockholders, and I thank you for your consideration and continued support.
 
Sincerely,
 
(-s-DANIEL W. DIENST)
Daniel W. Dienst
Chairman of the Board
Metal Management, Inc.
 
Neither the United States Securities and Exchange Commission nor any state securities commission has approved or disapproved of the merger described in this proxy statement/prospectus or the securities to be issued pursuant to the merger or determined that this proxy statement/prospectus is accurate or complete. Any representation to the contrary is a criminal offense.
 
This proxy statement/prospectus is dated February 12, 2008 and is being mailed to Metal Management stockholders on or about February 14, 2008.


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(METAL MANAGEMENT LOGO)
 
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON MARCH 14, 2008
 
To the Stockholders of Metal Management, Inc.:
 
A special meeting of Metal Management, Inc. stockholders will be held at 10:00 a.m., local time, on March 14, 2008, at the offices of King & Spalding LLP, 1185 Avenue of the Americas, 34th Floor, New York, New York, for the following purposes:
 
1. To consider and vote on the proposal to adopt the Agreement and Plan of Merger, dated as of September 24, 2007, by and among Sims Group Limited, MMI Acquisition Corporation and Metal Management, which is referred to as the merger agreement (a copy of which is attached as Appendix A to this proxy statement/prospectus).
 
2. To approve adjournments of the Metal Management special meeting, if necessary, to permit further solicitation of proxies if there are not sufficient votes at the time of the special meeting to approve the above proposal.
 
3. To consider and take action upon any other business that may properly come before the Metal Management special meeting or any reconvened meeting following an adjournment of the special meeting.
 
These items are described in the accompanying proxy statement/prospectus, which you should read carefully. Only Metal Management stockholders of record at the close of business on January 25, 2008, the record date for the Metal Management special meeting, are entitled to notice of, and to vote at, the Metal Management special meeting and any adjournments or postponements of the Metal Management special meeting. Under Delaware law, dissenters’ rights will not be available to Metal Management stockholders in connection with the merger.
 
Your vote is very important.  To ensure that your shares of Metal Management common stock are represented at the special meeting, please complete, date, sign and return the enclosed proxy/voting instruction card(s) and mail it/them promptly in the envelope provided, or vote your shares by telephone or over the Internet as described in the accompanying proxy statement/prospectus. Completing a proxy now will not prevent you from being able to vote at the special meeting by attending in person and casting a vote but will help to secure a quorum and avoid additional solicitation costs. However, if you do not return or submit the proxy or vote in person at the special meeting, the effect will be the same as a vote against the proposal to approve the merger agreement. You may revoke your proxy at any time before it is voted. Any executed but unmarked proxy/voting instruction card(s) will be voted “FOR” adoption of the merger agreement and as the Metal Management board of directors recommends on any other proposals properly brought before the special meeting.
 
By order of the Board of Directors of
Metal Management, Inc.
 
(-s-DANIEL W. DIENST)
    Daniel W. Dienst
Chairman of the Board
February 12, 2008


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ADDITIONAL INFORMATION
 
This proxy statement/prospectus incorporates by reference important business and financial information about Metal Management, Inc., which is referred to as Metal Management, from documents filed with the United States Securities and Exchange Commission, which is referred to as the SEC, that are not included in or delivered with this document. For a more detailed description of the documents incorporated by reference into this proxy statement/prospectus and how you may obtain them, see “Where You Can Find More Information” beginning on page 147.
 
Documents incorporated by reference are available to you without charge upon your written or oral request, excluding any exhibits to those documents, unless the exhibit is specifically incorporated by reference as an exhibit in this proxy statement/prospectus. You can obtain any of these documents from the SEC’s website at www.sec.gov or by requesting them in writing or by telephone at the following address:
 
Georgeson Inc.
17 State Street
New York, New York 10004
Telephone: (866) 288-2196
Facsimile: (212) 440-9009
 
Sims Group Limited, which is referred to as Sims, and Metal Management are not incorporating the contents of the websites of the SEC, Sims, Metal Management or any other person into this document. Metal Management is providing only the information about how you can obtain certain documents that are incorporated by reference into this proxy statement/prospectus at these websites for your convenience.
 
In order for you to receive timely delivery of the documents in advance of the Metal Management special meeting, Metal Management should receive your request no later than March 7, 2008.
 
This document, which forms part of a registration statement on Form F-4 filed with the SEC by Sims (File No. 333-147659), constitutes a prospectus of Sims under Section 5 of the United States Securities Act of 1933, as amended, which is referred to as the Securities Act, with respect to the Sims ordinary shares underlying the Sims American Depositary Shares, which are referred to as Sims ADSs, to be issued to Metal Management stockholders as required by the Agreement and Plan of Merger, dated as of September 24, 2007, by and among Sims, MMI Acquisition Corporation and Metal Management, which, together with the plan of merger contained therein, is referred to as the merger agreement. This document also constitutes a notice of meeting and a proxy statement under Section 14(a) of the United States Securities Exchange Act of 1934, as amended, which is referred to as the Exchange Act, with respect to the special meeting of Metal Management stockholders, at which Metal Management stockholders will be asked to consider and vote upon a proposal to adopt the merger agreement.
 
In this proxy statement/prospectus, unless otherwise specified or the context otherwise requires:
 
  •  “$” and “U.S. dollar” each refer to the United States dollar;
 
  •  “A$” and “Australian dollar” each refer to the Australian dollar;
 
  •  “Metal Management” refers to Metal Management, Inc.;
 
  •  “parties” refers to Sims and Metal Management;
 
  •  “Sims” refers to Sims Group Limited; and
 
  •  “Sims Metal Management” and the “combined company” each refer to the combined company resulting from the proposed merger.
 
Except as otherwise indicated, all references to dates and times in this proxy statement/prospectus are based on United States Eastern time.


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QUESTIONS AND ANSWERS ABOUT THE MERGER
 
The following questions and answers briefly address some commonly asked questions about the Metal Management special meeting and the merger. They do not include all the information that may be important to you. Sims and Metal Management urge you to read carefully this entire proxy statement/prospectus, including the appendices and the other documents referenced in this proxy statement/prospectus. Page references are included in certain parts of these questions and answers to direct you to a more detailed description of topics presented elsewhere in this proxy statement/prospectus.
 
Q: Why am I receiving this document?
 
A: Sims and Metal Management have agreed to enter into a merger transaction whereby Metal Management would be merged with a subsidiary of Sims, with Metal Management stockholders receiving Sims ADSs in exchange for their shares in connection with the merger. The terms of the merger are set forth in a merger agreement (any reference to the merger agreement also refers to the plan of merger contained therein) that is described in this proxy statement/prospectus. A copy of the merger agreement is attached to this proxy statement/prospectus as Appendix A.
 
Q: When and where will the Metal Management special meeting be held?
 
A: The Metal Management special meeting will be held on March 14, 2008 at 10:00 a.m., local time, at the offices of King & Spalding LLP, 1185 Avenue of the Americas, 34th Floor, New York, New York 10036.
 
Q: What is a Sims ADS?
 
A: An American Depositary Share, or ADS, is a security that allows shareholders in the United States to more easily hold and trade interests in foreign-based companies. ADSs are often evidenced by certificates known as American Depositary Receipts, or ADRs. Sims is an Australian company that issues ordinary shares that are equivalent in many respects to common stock of a U.S. company. Each Sims ADS represents one Sims ordinary share. Sims ordinary shares are quoted in Australian dollars on the Australian Securities Exchange, which is referred to as the ASX and which is the Australian national stock exchange.
 
Q: Will Sims ADSs be publicly traded in the United States?
 
A: Yes. Sims ADSs will be publicly traded in the United States and will be listed on the New York Stock Exchange, which is referred to as the NYSE, under the symbol “SMS” and quoted in United States dollars.
 
Q: How do I vote?
 
A: You may vote before the special meeting in one of the following ways:
 
• use the toll-free number shown on your proxy card;
 
• visit the website shown on your proxy card to vote via the Internet; or
 
• complete, sign, date and return the enclosed proxy card in the enclosed postage-paid envelope.
 
Q: If my shares are held in “street name” by a broker or other nominee, will my broker or nominee automatically vote my shares for me?
 
A: No. Your broker or other nominee does not have authority to vote on the merger proposal without instruction from you. Your broker or other nominee will vote your shares held by it in “street name” with respect to this matter only if you provide instructions to it on how to vote. You should follow the directions your broker or other nominee provides.
 
Q: What if I do not vote on the matters relating to the merger?
 
A: If you fail to respond with a vote or fail to instruct your broker or other nominee how to vote on the merger proposal, it will have the same effect as a vote against the merger proposal. If you respond but do not indicate how you want to vote on the merger proposal, your proxy will be counted as a vote in favor


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of the merger proposal. If you respond and abstain from voting on the merger proposal, your proxy will have the same effect as a vote against the merger proposal.
 
Q: When is the merger expected to be completed?
 
A: If the stockholders of Metal Management give their approval in connection with the merger, the merger is expected to be completed as soon as practicable after the satisfaction of the other conditions to the merger, including the receipt of required regulatory approvals. It is anticipated that the merger will be completed in the first calendar quarter of 2008.
 
Q: What are the implications to Metal Management stockholders of Sims being a “foreign private issuer”?
 
A: Following completion of the merger, Sims will be subject to the reporting requirements under the Exchange Act applicable to foreign private issuers. Sims will be required to file an annual report on Form 20-F with the SEC within six months after the end of each fiscal year. Sims’s current fiscal year begins on July 1 and ends on June 30. In addition, Sims will be required to furnish reports on Form 6-K to the SEC regarding certain information required to be publicly disclosed by Sims in Australia or filed with the ASX, or regarding information distributed or required to be distributed by Sims to its shareholders. Sims will be exempt from certain rules under the Exchange Act, including the proxy rules which impose certain disclosure and procedural requirements for proxy solicitations under Section 14 of the Exchange Act, and will not be required to comply with Regulation FD, which addresses certain restrictions on the selective disclosure of material information. In addition, among other matters, Sims’s officers, directors and principal shareholders will be exempt from the reporting and “short-swing” profit recovery provisions of Section 16 of the Exchange Act and the rules under the Exchange Act with respect to their purchases and sales of Sims ordinary shares. If Sims loses its status as a foreign private issuer, it will no longer be exempt from such rules and, among other things, will be required to file periodic reports and financial statements as if it were a company incorporated in the United States.
 
Q: What should I do now?
 
A: After carefully reading and considering the information contained in this proxy statement/prospectus, please vote your shares as soon as possible so that your shares will be represented at the Metal Management special meeting. Please follow the instructions set forth on the proxy card or on the voting instruction form provided by the record holder if your shares are held in the name of your broker or other nominee.
 
Q: Should I send in my stock certificates now?
 
A: No. Please DO NOT send your stock certificates with your proxy card. You will receive written instructions from Sims or the exchange agent after the merger is completed on how to exchange your stock certificates for the merger consideration.
 
Q: If I am going to attend the special meeting, should I return my proxy card?
 
A: Yes. Returning your signed and dated proxy card or voting by telephone or over the Internet ensures that your shares will be represented and voted at the Metal Management special meeting. See “The Metal Management Special Stockholders Meeting — Manner of Voting” beginning on page 30.
 
Q: May I change my vote after I have delivered my proxy?
 
A: Yes. You may change your vote at any time before your proxy is voted at the Metal Management special meeting. You may do this in one of four ways:
 
• by sending a notice of revocation to the corporate secretary of Metal Management;
 
• by sending a completed proxy card bearing a later date than your original proxy card;
 
• by logging onto the Internet website specified on your proxy card in the same manner you would to submit your proxy electronically or by calling the telephone number specified on your proxy card, in each case if you are eligible to do so and following the instructions on the proxy card; or
 
• by attending the Metal Management special meeting and voting in person.


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Your attendance alone will not revoke any proxy.
 
If you choose either of the first two methods, you must take the described action no later than the beginning of the special meeting; if you choose the third method, you must take the described action no later than 11:59 p.m., United States Eastern time, on the day immediately preceding the special meeting date.
 
If your shares are held in an account at a broker or other nominee, you should contact your broker or other nominee to change your vote.
 
Q: What if I receive multiple proxy cards?
 
A: Your shares may be registered in more than one account, such as a brokerage account and a 401(k) account. It is important that you complete, sign, date and return each proxy card you receive, or, if available, vote using the telephone or the Internet as described in the instructions included with your proxy cards.
 
Q: Who can help answer my questions?
 
A: If you have any questions about the merger or how to submit your proxy, or if you need additional copies of this proxy statement/prospectus, the enclosed proxy card or voting instructions, you should contact the firm below:
 
Georgeson Inc.
17 State Street
New York, New York 10004
Telephone: (866) 288-2196
Facsimile: (212) 440-9009
 
Q: Where can I find more information about Metal Management and Sims?
 
A: You can find more information about Metal Management and Sims from various sources described under “Where You Can Find More Information” beginning on page 147.


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SUMMARY
 
This summary highlights selected information contained in this proxy statement/prospectus and may not include all the information that is important to you. To understand fully the proposed merger, and for a more detailed description of the terms and conditions of the merger and certain other matters being considered at the Metal Management special meeting, you should read this entire proxy statement/prospectus and the documents referred to herein. See “Where You Can Find More Information” beginning on page 147. Page references are included in certain parts of this summary to direct you to a more detailed description of topics presented elsewhere in this proxy statement/prospectus.
 
The Companies
 
Metal Management, Inc.
 
Metal Management, a Delaware corporation, is one of the largest full-service metal recyclers in the United States, with 53 recycling facilities located in 17 states. Metal Management’s operations primarily involve the collection and processing of ferrous and non-ferrous metals. In addition to buying, processing and selling ferrous and non-ferrous metals, Metal Management is periodically retained as a demolition contractor in certain of its large metropolitan markets in which it dismantles obsolete machinery, buildings and other structures containing metal and, in the process, collects both ferrous and non-ferrous metals from these sources. At certain of Metal Management’s locations adjacent to commercial waterways, it also provides stevedoring services.
 
Metal Management’s principal executive offices are located at 325 N. LaSalle Street, Suite 550, Chicago, Illinois 60610 and its telephone number is (312) 645-0700.
 
Sims Group Limited
 
Sims, a corporation incorporated in Victoria, Australia, is, in the belief of Sims’s management, one of the world’s largest metals recycling companies on the basis of its market capitalization and the size and scope of its operations. Sims operates two primary businesses, Metal Recycling and Sims Recycling Solutions. The Metal Recycling business involves the collection, processing and marketing of ferrous and non-ferrous metals. Sims has significant positions in the metals recycling markets of Australasia, the east and west coasts of the United States, and the United Kingdom. Sims also has a strategic network of trading offices in Asia. The Sims Recycling Solutions business involves the “e-recycling” of information technology equipment and electrical and electronic consumer goods, and Sims has an emerging global presence with established operations in the United Kingdom, Continental Europe and North America and a developing presence in the Asia Pacific region.
 
Sims’s principal executive offices are located at Level 6, 41 McLaren Street, North Sydney NSW 2060, Australia and its telephone number is (61 2) 9956-9100.
 
MMI Acquisition Corporation
 
A wholly owned subsidiary of Sims, MMI Acquisition Corporation, a Delaware corporation, was formed exclusively for the purpose of completing the merger. MMI Acquisition Corporation’s separate corporate existence will cease upon completion of the merger.
 
The Merger
 
General
 
The boards of directors of Metal Management and Sims have each unanimously approved the merger agreement and the transactions contemplated by the merger agreement, including the merger, and unanimously determined that the merger agreement is in the best interests of their respective companies and shareholders. The Metal Management board of directors unanimously recommends that the Metal Management stockholders vote “FOR” adoption of the merger agreement at the Metal Management special meeting.


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Upon completion of the merger, the separate corporate existence of MMI Acquisition Corporation will cease and Metal Management will continue as the surviving entity and a wholly owned subsidiary of Sims.
 
The boards of directors of Metal Management and Sims both believe the merger will provide strategic and financial benefits to their respective shareholders by creating one of the pre-eminent global metal recycling companies. Both boards of directors believe that the merger is in the best interests of their respective companies and shareholders. To review the reasons for the merger in greater detail, see “The Merger — Metal Management’s Reasons for the Merger and Recommendation of its Board of Directors” beginning on page 40 and “The Merger — Sims’s Reasons for the Merger” beginning on page 50.
 
Please carefully read the entire merger agreement, a copy of which is attached to this proxy statement/prospectus as Appendix A, because it sets forth the terms of and is the principal legal document governing the merger.
 
Required Votes to Effect the Merger
 
Holders of a majority of the outstanding shares of Metal Management common stock entitled to vote at the Metal Management special meeting must adopt the merger agreement. See “The Metal Management Special Stockholders Meeting — Vote Required for Approval” beginning on page 30.
 
Merger Consideration
 
In the merger, each share of Metal Management common stock outstanding immediately prior to the effective time of the merger will be automatically converted into the right to receive 2.05 Sims ADSs, which is referred to as the exchange ratio, together with the right to receive cash in lieu of fractional Sims ADSs. No fraction of a Sims ADS will be issued in the merger. Instead, each holder of Metal Management common stock who would otherwise be entitled to receive a fractional Sims ADS in the merger will be entitled to receive a cash payment in U.S. dollars in lieu of such fractional Sims ADS.
 
Former Metal Management stockholders are currently expected to own ADSs representing approximately 30% of the outstanding ordinary shares of Sims after the merger, based on the number of Sims ordinary shares and shares of Metal Management common stock outstanding as of January 25, 2008.
 
Metal Management stockholders will have to surrender their common stock certificates to receive the merger consideration payable to them and any dividend they would otherwise be entitled to receive in respect of such Sims ADSs. PLEASE DO NOT SEND ANY CERTIFICATES NOW. Sims or the exchange agent will send Metal Management stockholders written instructions on how to surrender Metal Management common stock certificates for Sims ADSs after the merger is completed.
 
The Sims ADSs that Metal Management stockholders will receive in the merger are referred to collectively as the merger consideration. For more details on the merger consideration, see “The Merger Agreement — Merger Consideration” beginning on page 63. The exchange ratio is fixed and neither Sims nor Metal Management has the right to terminate the merger agreement based solely on changes in either party’s stock price. The market value of Sims ADSs that Metal Management stockholders receive in the merger may fluctuate significantly from its current value.
 
Metal Management Option Awards
 
Upon completion of the merger, options to purchase shares of Metal Management common stock granted by Metal Management to its directors, officers and employees will be assumed by Sims and converted into options to purchase Sims ADSs. Unless Sims and Metal Management otherwise agree, stock options so converted will remain subject to the same terms and conditions as were in effect with respect to the options immediately prior to the effective time of the merger, except that each of these stock options will be exercisable for Sims ADSs equal to the number of shares of Metal Management common stock subject to the option multiplied by 2.05 (rounded down to the nearest whole share), with the new exercise price determined by dividing the existing exercise price by 2.05 (rounded up to the nearest whole cent). Each unvested Metal


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Management stock option that is outstanding under any Metal Management stock option plan at the time of the merger will become fully vested and exercisable in connection with the merger.
 
For a full description of the treatment of Metal Management equity awards, see “The Merger Agreement — Merger Consideration” beginning on page 63.
 
Opinion of Metal Management’s Financial Advisor
 
In connection with the merger, the Metal Management board of directors received a written opinion, dated September 24, 2007, from Metal Management’s financial advisor, CIBC World Markets Corp., or CIBC World Markets, as to the fairness, from a financial point of view and as of the date of the opinion, of the exchange ratio provided for in the merger. The full text of CIBC World Markets’ written opinion, dated September 24, 2007, is attached to this proxy statement/prospectus as Appendix B. Holders of Metal Management common stock are encouraged to read this opinion carefully in its entirety for a description of the assumptions made, procedures followed, matters considered and limitations on the review undertaken. CIBC World Markets’ opinion was provided to the Metal Management board of directors in connection with its evaluation of the exchange ratio from a financial point of view. CIBC World Markets’ opinion does not address any other aspect of the merger and does not constitute a recommendation to any stockholder as to how such stockholder should vote or act with respect to any matters relating to the merger.
 
Record Date; Shares Entitled to Vote; Outstanding Shares
 
The record date for the Metal Management special meeting is January 25, 2008. This means that you must have been a stockholder of record of Metal Management’s common stock at the close of business on January 25, 2008 in order to vote at the special meeting. You are entitled to one vote for each share of Metal Management common stock you owned on the record date. On Metal Management’s record date, 26,141,746 shares of Metal Management common stock were outstanding.
 
Expected Completion of the Merger
 
If the merger agreement is approved at the Metal Management special meeting, the merger is expected to be completed as soon as practicable after the satisfaction of the other conditions to the merger, including the receipt of required regulatory approvals. It is currently anticipated that the merger will be completed in the first calendar quarter of 2008.
 
Stock Ownership of Directors and Executive Officers
 
At the close of business on the record date for the Metal Management special meeting, directors and executive officers of Metal Management and their affiliates were entitled to vote approximately 904,082 shares of Metal Management common stock, collectively representing less than 3.5% of the shares of Metal Management common stock outstanding on that date.
 
Interests of Metal Management Directors and Executive Officers in the Merger
 
Certain members of the Metal Management board of directors and executive officers of Metal Management have certain interests in the merger that are in addition to or conflict with the interests of the Metal Management stockholders. These interests include:
 
  •  the designation of certain directors and officers as Sims Metal Management directors or executive officers;
 
  •  the accelerated vesting of options to purchase an aggregate of 120,000 shares of Metal Management common stock held by the Metal Management independent directors upon completion of the merger;
 
  •  the accelerated vesting of 554,699 shares of Metal Management restricted stock held by Metal Management executive officers upon completion of the merger; and
 
  •  the granting of bonuses by Metal Management to certain executive officers (other than its chief executive officer) in an aggregate amount of up to $1.5 million prior to completion of the merger.


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In addition, Sims entered into a letter agreement with Metal Management’s chairman and chief executive officer, Daniel W. Dienst that will, upon consummation of the merger, amend his employment agreement. In addition, Metal Management will pay Mr. Dienst his annual bonus for the period ending March 31, 2008 at or before the completion of the merger in an amount equal to 200% of his base salary, plus an additional three months of annualized bonus at the same percentage for anticipated performance through June 30, 2008. The Metal Management board of directors also has advised Mr. Dienst that any discretionary award to him in respect of Metal Management’s fiscal 2008 performance would be increased by an amount of restricted stock with a value of $1 million in recognition of his extraordinary efforts with respect to the merger (but no more than 75,000 shares), which may automatically vest upon the consummation of the merger.
 
Sims also entered into a letter agreement with Metal Management’s chief financial officer, Robert C. Larry that will, upon consummation of the merger, amend his agreement, increasing his base salary to $600,000. Additionally, Metal Management will pay Mr. Larry his annual bonus for the period ending March 31, 2008 at or before the completion of the merger in an amount equal to 100% of his base salary, plus an additional three months of annualized bonus at the same percentage for anticipated performance through June 30, 2008.
 
For a full description, see “The Merger — Interests of Metal Management Directors and Executive Officers in the Merger” beginning on page 51.
 
Board of Directors of Sims Metal Management After the Merger
 
The size of the Sims board of directors is currently set at seven members. Upon the effective time of the merger, the board of directors of Sims Metal Management will have 12 directors, as follows:
 
  •  Norman R. Bobins, John T. DiLacqua, Robert Lewon and Gerald E. Morris, who are currently non-executive directors of Metal Management;
 
  •  Paul K. Mazoudier, J. Michael Feeney and Paul J. Varello, who are currently non-executive directors of Sims;
 
  •  Masakatsu Iwanaga and Christopher J. Renwick, who are currently non-executive directors of Sims designated by Mitsui & Co., Ltd. of Japan, a subsidiary of which is the largest shareholder of Sims;
 
  •  Jeremy L. Sutcliffe, who is currently chief executive officer of Sims, and Ross B. Cunningham, who is currently executive director group finance and strategy of Sims; and
 
  •  Daniel W. Dienst, who is currently president and chief executive officer of Metal Management.
 
For information regarding the governance of Sims Metal Management after the merger, including biographical information regarding its directors, see “The Merger — Board of Directors of Sims Metal Management After the Merger” beginning on page 51 and “The Merger Agreement — Corporate Governance Matters” beginning on page 65.
 
Executive Officers of Sims Metal Management After the Merger
 
As of the effective time of the merger, Daniel W. Dienst will be appointed as group chief executive officer of Sims Metal Management and will chair the combined North American metal recycling business, and Robert C. Larry, Metal Management’s current chief financial officer, will be appointed as chief financial officer of Sims Metal Management. Jeremy L. Sutcliffe will continue as an executive director of Sims Metal Management reporting to the new board of directors until at least October 2009 and will chair Sims Metal Management’s metal recycling operations in Australasia and Europe as well as the Sims Recycling Solutions business globally. Ross B. Cunningham will also continue as an executive director of Sims Metal Management.
 
For biographical information regarding the executive officers of Sims Metal Management after the merger, see “The Merger — Executive Officers of Sims Metal Management After the Merger” beginning on page 54.


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Listing of Sims ADSs and Delisting of Metal Management Common Stock
 
Sims will apply to have the Sims ADSs issued in the merger approved for listing on the NYSE under the symbol “SMS.” If the merger is completed, Metal Management common stock will no longer be listed on the NYSE and will be deregistered under the Exchange Act and Metal Management will no longer file periodic reports with the SEC.
 
No Dissenters’ Rights
 
Under Delaware law, holders of Metal Management common stock are not entitled to dissenters’ rights in connection with the merger.
 
Principal Conditions to the Completion of the Merger
 
Sims and Metal Management may not complete the merger unless the following conditions are satisfied or, where permitted, waived:
 
  •  the Metal Management stockholders must adopt the merger agreement;
 
  •  the waiting period (and any extension thereof) applicable to the merger pursuant to the Hart-Scott Rodino Antitrust Improvements Act of 1976, as amended, which is referred to as the HSR Act, or any other applicable competition, merger, antitrust, foreign investment or similar law must have expired or been terminated;
 
  •  the registration statement, of which this proxy statement/prospectus is a part, must have been declared effective by the SEC, must not be the subject of any stop order or proceeding seeking a stop order, and Sims must receive all state securities law authorizations necessary to issue the Sims ADSs pursuant to the merger;
 
  •  the Sims ADSs issuable to Metal Management stockholders must have been approved for listing, subject to official notice of issuance, on the NYSE;
 
  •  all other governmental commission, board or other regulatory consents, authorizations, orders, approvals or filings that are necessary to complete the merger must have been obtained and be in full force and effect, subject to exceptions that would not have a material adverse effect on Metal Management or Sims;
 
  •  there must not be any judgment, decree, order or injunction of a court of competent jurisdiction that prohibits or makes illegal the transactions contemplated by the merger agreement;
 
  •  Metal Management must have received an opinion of its tax counsel to the effect that the merger will be treated for United States federal income tax purposes as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended, which is referred to as the Code, and that Sims, Metal Management and MMI Acquisition Corporation will qualify as parties to a reorganization within the meaning of Section 368(b) of the Code;
 
  •  the respective representations and warranties of Metal Management and Sims in the merger agreement must be true and correct, subject to exceptions that would not have a material adverse effect on Metal Management or Sims, as the case might be, or on Sims Metal Management following completion of the merger; and
 
  •  each of Metal Management and Sims must have performed in all material respects all of its respective obligations under the merger agreement.
 
Certain of these conditions, including termination of the waiting period under the HSR Act, have been satisfied prior to the date of this proxy statement/prospectus. Under the merger agreement, the parties may elect to waive the satisfaction of any of these conditions, other than the condition relating to the adoption of the merger agreement by the stockholders of Metal Management.


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Termination Events and Termination Fees
 
Each of Sims and Metal Management will be required to pay a fee to the other or reimburse the other for certain fees and expenses if the merger agreement is terminated under the circumstances specified below:
 
A fee of $25 million, which is referred to as the termination fee, will be payable by a party to the other party if:
 
  •  the paying party terminates the merger agreement to enter into a superior acquisition proposal; or
 
  •  the paying party knowingly breached the representations and warranties in the merger agreement at the date of the merger agreement.
 
The termination fee will also be payable by Metal Management to Sims if:
 
  •  Sims terminates the merger agreement because the Metal Management board of directors has withdrawn or modified in an adverse manner its recommendation of the merger; or
 
  •  either party terminates the merger agreement because Metal Management’s stockholders failed to approve the merger, if (i) prior to the Metal Management special stockholders meeting, an acquisition proposal was publicly announced or communicated to the Metal Management board of directors and (ii) Metal Management enters into any business combination transaction, or an agreement providing for such transaction, with any third party within 12 months following such termination.
 
A reimbursement of up to $10 million of out-of-pocket costs and expenses will be payable by one party to the other party if the paying party breaches the merger agreement in a manner that causes the failure of a closing condition (other than the covenants relating to non-solicitation or actions required to register or list the Sims ADSs or call the Metal Management stockholder meeting) that continues for 30 days following notice by the non-breaching party or is not capable of being cured, unless the termination fee is applicable.
 
If a termination results from the willful and material failure by any party to perform its obligations under the merger agreement, such party will be fully liable for any and all damages suffered or incurred by the other party as a result of such failure.
 
No Solicitation by Metal Management and Sims
 
The merger agreement restricts the ability of Metal Management and Sims to initiate, solicit or encourage or facilitate any discussions or negotiations with a third party regarding a proposal to acquire a significant interest in Metal Management or Sims, respectively. However, if Metal Management or Sims receives an unsolicited written acquisition proposal from a third party that its respective board of directors determines in good faith (after consultation with its outside legal and financial advisors) constitutes a superior proposal or is reasonably likely to result in a superior proposal, and for which the failure to take such action would be reasonably likely to result in a breach of the fiduciary duties of that board of directors, the party receiving the acquisition proposal may furnish nonpublic information to that third party and engage in negotiations regarding an acquisition proposal with that third party, subject to specified conditions described in the merger agreement.
 
Material Tax Consequences
 
A United States stockholder of Metal Management that exchanges Metal Management shares for Sims ADSs in the merger generally will not recognize any gain or loss for United States federal income tax purposes except with respect to cash, if any, received instead of a fractional Sims ADS.
 
Holders of Metal Management common stock should realize no taxable gain or loss and receive no taxable income for Australian tax purposes upon the receipt of Sims ADSs or cash to be issued in connection with the merger in exchange for shares of Metal Management common stock provided that they are not residents of Australia for Australian tax purposes and that they are not using, holding or acquiring the Sims ADSs for the purposes of any business carried on in Australia.
 
Tax matters relating to the merger are complicated and a full discussion of all possible tax issues that may be applicable to each holder is beyond the scope of this proxy statement/prospectus. You should be aware


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that the tax consequences of the merger to you will depend upon your own situation. In addition, you may be subject to state, local or foreign tax laws that are not disclosed in this proxy statement/prospectus. We therefore recommend that you consult with your own tax advisor for a full understanding of the tax consequences of the merger to you. In addition, we strongly urge you to carefully read the more detailed discussion regarding the material United States federal income tax consequences and Australian tax consequences resulting from the merger that is included in the sections entitled “Material United States Federal Income Tax Consequences” beginning on page 78 and “Material Australian Tax Consequences” beginning on page 82.
 
Accounting Treatment
 
The merger will be accounted for under U.S. GAAP as a business combination under the “purchase method” as defined by Statement of Financial Accounting Standards No. 141, Business Combinations. Sims will be the acquirer for financial accounting purposes. See “Accounting Treatment” beginning on page 84.
 
Risk Factors
 
In evaluating the merger, the merger agreement or the issuance of Sims ADSs in the merger, you should carefully read this proxy statement/prospectus and especially consider the factors discussed in the section entitled “Risk Factors” beginning on page 15.
 
Comparison of Stockholders Rights and Corporate Governance Matters
 
As a result of the merger, the holders of Metal Management common stock will become holders of Sims ADSs. Following the merger, Metal Management stockholders will have different rights as holders of Sims ADSs than they had as Metal Management stockholders due to the differences between the laws of the jurisdiction of incorporation and the certificate of incorporation and bylaws of Metal Management and the jurisdiction of incorporation and constitution of Sims. See “Comparative Rights of Stockholders” beginning on page 130. For a copy of Metal Management’s current certificate of incorporation or bylaws, see “Where You Can Find More Information” beginning on page 147. Sims’s constitution is included as an exhibit to the registration statement of which the proxy statement/prospectus is a part.
 
Regulatory Approvals
 
The merger is subject to the United States antitrust laws and laws regulating foreign investment in the United States. Sims and Metal Management have filed the required notifications and received early termination of the waiting period under the HSR Act. The parties have also filed a voluntary notice of the merger with the Committee of Foreign Investment in the United States, which is referred to as CFIUS, under Section 721 of the Defense Production Act of 1950, as amended by the Foreign Investment and National Security Act of 2007, which are referred to as the Exon-Florio Provisions. CFIUS has notified the parties that it has cleared the merger. In addition, Sims and Metal Management have filed notifications with the competition authorities in China, Germany, Greece and Turkey. The merger has received antitrust clearance from the competition authorities in each of these jurisdictions. Despite having received antitrust clearance, the merger may be subject to further antitrust scrutiny in the United States and potentially elsewhere both before and after its completion.
 
Market Price and Dividend Information
 
Historical Market Price Information
 
Metal Management’s common stock is traded on the NYSE under the symbol “MM.” Sims ordinary shares are traded on the ASX under the symbol “SGM.”


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Prior to October 5, 2006, Metal Management common stock traded on the NASDAQ National Market System under the symbol “MTLM.” The following table sets forth the high and low closing prices per share of (i) Metal Management common stock on the NASDAQ National Market System for periods prior to October 5, 2006, (ii) Metal Management common stock on the NYSE beginning October 5, 2006 and (iii) Sims ordinary shares as reported on the ASX for the periods indicated:
 
                                 
    Sims Ordinary Shares     Metal Management Common Stock  
    High     Low     High     Low  
 
2005
                               
Quarter ended March 31, 2005
  A$ 19.08     A$ 16.56     $ 30.24     $ 22.94  
Quarter ended June 30, 2005
  A$ 17.22     A$ 12.91     $ 25.96     $ 16.88  
Quarter ended September 30, 2005
  A$ 19.45     A$ 14.26     $ 27.62     $ 19.64  
Quarter ended December 31, 2005
  A$ 19.22     A$ 16.07     $ 25.86     $ 22.93  
2006
                               
Quarter ended March 31, 2006
  A$ 17.70     A$ 14.44     $ 32.25     $ 23.48  
Quarter ended June 30, 2006
  A$ 20.30     A$ 17.67     $ 34.91     $ 27.93  
Quarter ended September 30, 2006
  A$ 21.45     A$ 18.00     $ 31.87     $ 24.12  
Quarter ended December 31, 2006
  A$ 23.50     A$ 19.60     $ 38.75     $ 27.39  
2007
                               
Quarter ended March 31, 2007
  A$ 24.45     A$ 19.20     $ 46.20     $ 36.90  
Quarter ended June 30, 2007
  A$ 27.73     A$ 22.85     $ 51.45     $ 44.07  
Quarter ended September 30, 2007
  A$ 33.30     A$ 23.97     $ 55.85     $ 40.60  
Quarter ended December 31, 2007
  A$ 31.15     A$ 25.65     $ 57.62     $ 44.40  
2008
                               
Quarter ending March 31, 2008 (through February 7, 2008)
  A$ 29.90     A$ 24.41     $ 52.70     $ 43.38  
 
Dividend Information
 
The following tables present information on dividends determined or declared on Sims ordinary shares and on Metal Management common stock for the periods indicated.
 
         
    Sims Dividends  
 
Fiscal 2006
       
Half year period ended December 31, 2005
       
- Hugo Neu Corporation
  A$ 0.15  
- all other shareholders
  A$ 0.45  
Half year period ended June 30, 2006
  A$ 0.60  
Fiscal 2007
       
Half year period ended December 31, 2006
  A$ 0.60  
Half year period ended June 30, 2007
  A$ 0.60  
 


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    Metal Management
    Dividends
 
Fiscal 2006
       
Quarter ended June 30, 2005
  $ 0.075  
Quarter ended September 30, 2005
  $ 0.075  
Quarter ended December 31, 2005
  $ 0.075  
Quarter ended March 31, 2006
  $ 0.075  
Fiscal 2007
       
Quarter ended June 30, 2006
  $ 0.075  
Quarter ended September 30, 2006
  $ 0.075  
Quarter ended December 31, 2006
  $ 0.075  
Quarter ended March 31, 2007
  $ 0.075  
Fiscal 2008
       
Quarter ended June 30, 2007
  $ 0.075  
Quarter ended September 30, 2007
  $ 0.075  
Quarter ended December 31, 2007
  $ 0.075  
 
 
Prior to the merger, the merger agreement permits Metal Management to continue to pay its stockholders its regular quarterly cash dividend consistent with past dividend policy and Sims to continue to pay its shareholders its regular half yearly period cash dividend and to issue Sims ordinary shares in lieu of a cash dividend under its dividend reinvestment plan consistent with past dividend policy.
 
After the merger, the board of directors of Sims Metal Management will have the power to determine the amount and frequency of the payment of dividends with respect to Sims ordinary shares and Sims ADSs, having regard to shareholder expectations and the capital requirements, earnings and cash flow of the business. The board of directors of Sims Metal Management will evaluate the most effective means to provide returns to shareholders, which may include supplementing dividends with other capital management options, including share buybacks. At the outset, it is contemplated that the combined company will return in the order of 45% to 55% of net profit after tax to its shareholders.
 
Recent Closing Prices and Comparative Market Price Information
 
The following table presents the closing prices per share of Sims ordinary shares and Metal Management common stock based on closing prices for those shares on the ASX and NYSE, respectively, as well as the equivalent price per share of Metal Management common stock. These prices and values are presented on two dates:
 
  •  September 21, 2007, the last trading day prior to the public announcement of the proposed merger; and
 
  •  February 7, 2008, the last trading day for which this information could be calculated prior to the date of this proxy statement/prospectus.
 
                         
    Sims Ordinary
  Metal Management
  Metal Management
    Shares (Price per
  Common Stock
  Equivalent Stock Price
    Share)(1)   (Price per Share)   (Price per Share)(2)
 
As of closing on September 21, 2007:
                       
Price per share
  $ 28.16     $ 48.86     $ 57.72  
As of closing on February 7, 2008:
                       
Price per share
  $ 26.74     $ 52.70     $ 54.82  
 
 
(1) Sims ordinary share price as at the close of trading on September 21, 2007 and February 7, 2008 of A$32.55 and A$29.90, respectively, converted into U.S. dollars at the daily noon buying rates, as published by the Federal Reserve Bank of New York, on September 21, 2007 and February 7, 2008, respectively.

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(2) The Metal Management equivalent stock prices were calculated by multiplying the per share price of Sims ordinary shares on each date by the exchange ratio of 2.05.
 
Because the exchange ratio is fixed and will not be adjusted as a result of changes in the market prices of Sims ordinary shares or Metal Management common stock, the implied value of the merger consideration will fluctuate with the market price of Sims ordinary shares and the Australian dollar — U.S. dollar exchange rate. You should obtain current market quotations for Sims ordinary shares from a newspaper, the Internet or your broker or banker.
 
Selected Historical Consolidated Financial Information
 
Selected Historical Consolidated Financial Information of Metal Management
 
The following table shows selected consolidated financial information for Metal Management. The information as of and for each of the five years ended March 31, 2007 was derived from Metal Management’s audited consolidated financial statements. The information as of September 30, 2007 and for the six months ended September 30, 2007 and 2006 was derived from Metal Management’s unaudited consolidated financial statements.
 
You should read the following selected financial information together with Metal Management’s historical consolidated financial statements, including the related notes, and the other information incorporated by reference in this proxy statement/prospectus. See “Where You Can Find More Information” beginning on page 147.
 
                                                         
    Six Months
       
    Ended
       
    September 30,     Years Ended March 31,  
    2007     2006     2007     2006     2005     2004     2003  
    (Unaudited)     (In thousands of U.S. dollars or shares, except for per share amounts)  
 
Statement of Operations Data:
                                                       
Net sales
  $ 1,369,208     $ 1,080,620     $ 2,229,012     $ 1,589,126     $ 1,701,958     $ 1,083,413     $ 770,009  
Net income
  $ 40,502     $ 73,962     $ 116,405     $ 60,264     $ 92,250     $ 51,389     $ 20,501  
Basic earnings per share
  $ 1.61     $ 2.86     $ 4.54     $ 2.45     $ 3.96     $ 2.42     $ 1.01  
Weighted average shares outstanding
    25,197       25,834       25,637       24,579       23,279       21,243       20,323  
Diluted earnings per share
  $ 1.58     $ 2.79     $ 4.43     $ 2.35     $ 3.74     $ 2.27     $ 0.99  
Weighted average diluted shares outstanding
    25,603       26,489       26,251       25,670       24,659       22,653       20,741  
Balance Sheet Data:
                                                       
Total assets
  $ 755,011       N/A     $ 695,523     $ 555,317     $ 478,782     $ 406,416     $ 248,651  
Long-term debt (including current maturities)
  $ 31,829       N/A     $ 206     $ 3,248     $ 2,531     $ 44,297     $ 89,610  
Stockholders’ equity
  $ 506,919       N/A     $ 464,830     $ 383,889     $ 312,616     $ 202,839     $ 78,282  
Cash dividends paid per share
  $ 0.15     $ 0.15     $ 0.30     $ 0.30     $ 0.15     $     $  


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Selected Historical Consolidated Financial Information of Sims
 
The following table shows selected consolidated financial information for Sims. The information as of June 30, 2006 and June 30, 2007 and for each of the three years ended June 30, 2007 was derived from Sims’s audited consolidated financial statements. The information as of June 30, 2005, June 30, 2004 and June 30, 2003 and for each of the years ended June 30, 2004 and 2003 is unaudited. You should read the following selected financial information together with Sims’s historical consolidated financial statements, including the related notes, and the other information contained elsewhere in this proxy statement/prospectus. See “Index to Financial Statements” beginning on page F-1.
 
                                         
    Year Ended June 30,  
    2007     2006     2005     2004     2003  
    (In thousands of Australian dollars or shares, except for per share amounts)  
 
Statement of Operations Data:
                                       
Net sales
  A$ 5,386,044     A$ 3,612,313     A$ 2,413,262     A$ 1,751,101     A$ 1,469,536  
Net income
  A$ 249,874     A$ 191,128     A$ 189,082     A$ 119,704     A$ 74,735  
Basic earnings per share
  A$ 2.00     A$ 1.69     A$ 2.08     A$ 1.30     A$ 0.82  
Diluted earnings per share
  A$ 1.99     A$ 1.69     A$ 2.07     A$ 1.30     A$ 0.82  
Weighted average shares outstanding
    124,916       112,857       91,086       91,766       91,273  
Weighted average diluted shares outstanding
    125,620       113,193       91,180       91,854       91,319  
Balance Sheet Data:
                                       
Total assets
  A$ 1,979,035     A$ 1,801,379     A$ 817,205     A$ 712,327     A$ 577,413  
Total long-term debt
  A$ 339,538     A$ 302,528     A$ 98,946     A$ 38,050     A$ 8,292  
Shareholders’ equity
  A$ 1,100,367     A$ 1,031,726     A$ 478,118     A$ 457,940     A$ 395,040  
Cash dividends paid per ordinary share
  A$ 1.20     A$ 1.35     A$ 1.30     A$ 0.57     A$ 0.42  
 
Selected Unaudited Pro Forma Combined Financial Information
 
The following selected unaudited pro forma combined financial information shows the pro forma effect of the consummation of the merger of Sims and Metal Management, as provided in the merger agreement as if the merger had occurred on July 1, 2006 for statement of operations purposes and on June 30, 2007 for balance sheet purposes. The information has been prepared in accordance with U.S. GAAP and is derived from, and should be read in conjunction with, the historical consolidated financial statements of Sims for its fiscal year ended June 30, 2007, the index to which is included on page F-1 of this proxy statement/prospectus, and the historical consolidated financial statements of Metal Management for its fiscal year ended March 31, 2007 and fiscal quarter ended June 30, 2007, which are incorporated by reference in this proxy statement/prospectus. The information should also be read in conjunction with the information provided under “Unaudited Pro Forma Combined Financial Information” beginning on page 85 and “Notes to Unaudited Pro Forma Combined Financial Information” beginning on page 90.


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The pro forma information below is presented for illustrative purposes only and is not necessarily indicative of the operating results or financial position that would have been achieved if the merger had been completed as of the beginning of the period presented, nor is it necessarily indicative of the future operating results or financial position of the combined company.
 
Selected Unaudited Pro Forma Combined Statement of Operations Information
 
                                 
    Sims Group
    Metal
    Pro Forma
    Pro Forma
 
    Limited
    Management, Inc.
    Adjustments
    Combined
 
    Fiscal Year Ended
    Period from July 1,
    Fiscal Year
    Fiscal Year
 
    June 30,
    2006 to June 30,
    Ended June 30,
    Ended June 30,
 
    2007     2007(1)(2)     2007(1)(2)     2007(1)(2)  
    (In thousands of Australian dollars, except for per share amounts)  
 
Revenue
  A$ 5,386,044     A$ 3,043,620     A$     A$ 8,429,664  
Operating expenses
    (5,017,389 )     (2,854,862 )     (11,822 )     (7,884,073 )
                                 
Operating income
    368,655       188,758       (11,822 )     545,591  
Income from joint ventures
    14,050       2,479             16,529  
Interest expense
    (29,963 )     (3,198 )           (33,161 )
Interest and other income, net
    11,177       3,224             14,401  
                                 
Income before income taxes
    363,919       191,263       (11,822 )     543,360  
Provision for income taxes
    (114,045 )     (71,089 )     4,611       (180,523 )
                                 
Net income
  A$ 249,874     A$ 120,174     A$ (7,211 )   A$ 362,837  
                                 
Basic earnings per share
  A$ 2.00                     A$ 2.02  
                                 
 
Selected Unaudited Pro Forma Combined Per Share Information
 
                 
          Pro Forma Combined
 
          Fiscal Year Ended
 
          June 30,
 
          2007(1)(2)  
          (In thousands of
 
          Australian dollars, except
 
          for share and per share amounts)  
 
Pro forma net income
          A$ 362,837  
Weighted average number of ordinary shares used in calculating basic earnings per share(3):
            179,596,802  
Effect of dilution:
               
Options, including ordinary shares issued under the Sims Group Employee Share Scheme deemed to be options for accounting purposes
            704,319  
                 
Adjusted weighted average number of ordinary shares used in calculating diluted earnings per share
            180,301,121  
                 
Basic earnings per share
          A$ 2.02  
                 
Diluted earnings per share
          A$ 2.01  
                 


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Selected Unaudited Pro Forma Combined Balance Sheet Information
 
                                 
    Sims Group
    Metal
    Pro Forma
    Pro Forma
 
    Limited
    Management, Inc.
    Adjustments
    Combined
 
    June 30,
    June 30,
    June 30,
    June 30,
 
    2007     2007(2)(4)     2007(2)     2007(2)  
    (In thousands of Australian dollars)  
 
ASSETS
Total current assets
  A$ 775,557     A$ 608,205     A$ 30,813     A$ 1,414,575  
                                 
Total non-current assets
    1,203,478       337,932       1,318,701       2,860,111  
                                 
Total assets
    1,979,035       946,137       1,349,514       4,274,686  
                                 
 
LIABILITIES
Total current liabilities
    437,841       250,047       30,000       717,888  
Total non-current liabilities
    440,827       122,024       105,518       668,369  
                                 
Total liabilities
    878,668       372,071       135,518       1,386,257  
                                 
 
SHAREHOLDERS’ EQUITY
Ordinary shares
    728,378       241,162       1,546,900       2,516,440  
Accumulated other comprehensive income
    (68,297 )     (11,661 )     11,661       (68,297 )
Retained earnings
    440,286       404,841       (404,841 )     440,286  
Treasury stock, at cost
          (60,276 )     60,276        
                                 
Shareholders’ equity
    1,100,367       574,066       1,213,996       2,888,429  
                                 
Total liabilities and shareholders’ equity
  A$ 1,979,035     A$ 946,137     A$ 1,349,514     A$ 4,274,686  
                                 
 
 
(1) The information is derived from the historical consolidated financial statements of Metal Management for its fiscal year ended March 31, 2007, adjusted for the following to derive comparable reporting periods with Sims:
 
  •  quarterly information for the period April 1, 2006 to June 30, 2006 is not included in the pro forma financial information for Metal Management; and
 
  •  quarterly information for the period April 1, 2007 to June 30, 2007 has been included in the pro forma financial information for Metal Management.
 
(2) The information for Metal Management and the pro forma adjustments above were originally denominated in U.S. dollars and have been converted to Australian dollars based on the average exchange rate for the period from July 1, 2006 to June 30, 2007 of A$1.275 = $1.00 for the statement of operations and the noon buying rate as of June 29, 2007 of A$1.176 = $1.00 for the balance sheet.
 
(3) The merger consideration consists of Sims ADSs representing Sims ordinary shares. The weighted average number of pro forma shares has been adjusted as if the Sims ADSs to be issued in connection with the merger had been issued on July 1, 2006.
 
(4) The information is derived from the historical financial statements of Metal Management for its fiscal quarter ended June 30, 2007, which are unaudited.
 
Audited historical financial statements for Sims are included in this proxy statement/prospectus beginning on page F-2. Audited historical financial statements for the two-month period ending October 31, 2005 for entities operating certain of the recycling businesses of Hugo Neu Corporation are included in this proxy statement/prospectus beginning on page F-38. These entities were acquired by Sims in October 2005. The financial statements for these entities were prepared based on financial information relating to the period of ownership of these entities by Hugo Neu Corporation prior to their acquisition by Sims. Audited and unaudited historical financial statements for Metal Management are incorporated by reference in this proxy statement/prospectus. For additional information, see “Where You Can Find More Information” beginning on page 147.


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Unaudited Comparative Per Share Information
 
The following table summarizes unaudited per share information for Sims and Metal Management on a historical basis, on a pro forma combined basis for the combined company and on an equivalent pro forma combined basis for Metal Management. It has been assumed for purposes of the pro forma financial information provided below that the merger was completed on July 1, 2006 for statement of operations purposes, and on June 30, 2007 for balance sheet purposes. The following information should be read in conjunction with the audited consolidated financial statements of Sims and Metal Management as of and for the years ended June 30, 2007 and March 31, 2007, respectively, and the unaudited consolidated financial statements of Metal Management for the quarterly period ended June 30, 2007, each of which is included or incorporated by reference into this proxy statement/prospectus, and with the information under “Unaudited Pro Forma Combined Financial Information” and related notes included elsewhere in this proxy statement/prospectus.
 
                                 
    Year Ended June 30, 2007  
                Sims
    Metal Management
 
    Historical
    Historical
    Pro Forma
    Pro Forma
 
    Sims(1)     Metal Management     Combined     Equivalent(2)  
    (In thousands of U.S. dollars, except per share amounts)  
 
Income from continuing operations
  $ 195,980     $ 94,255     $ 284,578          
Per Common Share
                               
Basic
  $ 1.57     $ 3.75     $ 1.58     $ 3.24  
Diluted
  $ 1.56     $ 3.68     $ 1.58     $ 3.24  
Dividends
  $ 0.94     $ 0.30     $ 0.70     $ 1.44  
Book value of equity
  $ 7.43     $ 18.89     $ 13.61     $ 27.90  
 
 
(1) Sims’s results as reported in Australian dollars have been converted into U.S. dollars using an average exchange rate of A$1.275 = $1.00 and a year end rate of A$1.176 = $1.00.
 
(2) The Metal Management pro forma equivalent per share amounts are calculated by multiplying the Sims pro forma combined amounts per share by the exchange ratio of 2.05.
 
Exchange Rate Information
 
On September 21, 2007, the last trading day before the public announcement of the proposed merger, the exchange rate between the U.S. dollar and the Australian dollar expressed in U.S. dollars per Australian dollar was A$1.00 = $0.865. On February 7, 2008, the most recent practicable day prior to the date of this proxy statement/prospectus, the exchange rate was A$1.00 = $0.894. For additional information regarding historical exchange rates between the U.S. dollar and Australian dollar, see “Currencies and Exchange Rates” beginning on page 120.


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RISK FACTORS
 
In addition to general investment risks and the other information contained in or incorporated by reference into this document, including the matters under the caption “Cautionary Statements Regarding Forward-Looking Information” and the matters discussed under the caption “Risk Factors” included in the Annual Report on Form 10-K filed by Metal Management for the 12-month period ended March 31, 2007, as updated by subsequently filed Forms 8-K and 10-Q, you should carefully consider the following factors in deciding whether to vote for adoption of the merger agreement.
 
Risks Relating to the Merger
 
Because the market price of Sims ordinary shares will fluctuate, Metal Management stockholders cannot be sure of the value of the consideration they will receive in the merger.
 
Upon completion of the merger, each share of Metal Management’s common stock will be converted into the right to receive 2.05 Sims ADSs. Each Sims ADS will represent one Sims ordinary share, and the value of the Sims ADSs is accordingly expected to fluctuate based, to a significant extent, on corresponding changes in the value of Sims ordinary shares. The value of Sims ordinary shares may vary significantly from the closing price of Sims ordinary shares on the date the merger was announced, the date that this document was mailed to Metal Management stockholders, the date of the special meeting of Metal Management stockholders and the last trading day preceding the closing date. There will be no adjustment to the exchange ratio for changes in the market price of Sims ordinary shares or Metal Management common stock. Neither company is permitted to terminate the merger agreement, and the Metal Management board of directors is not permitted to change its recommendation to its stockholders to approve the merger, solely because of changes in the market price of either company’s stock. The market value of Sims ADSs to be received in the merger will continue to fluctuate following completion of the merger. Stock price changes may result from a variety of factors, including general market and economic conditions, changes in Sims Metal Management’s businesses, operations and prospects, and regulatory considerations. Many of these factors will be beyond the control of Sims Metal Management and its management. Before deciding whether to vote for adoption of the merger agreement, you should obtain current market quotations for Sims ordinary shares and shares of Metal Management common stock.
 
The value of Sims ADSs to be received in the merger will be subject to currency fluctuations.
 
Prior to the completion of the merger, any change in the U.S. dollar — Australian dollar exchange rate will affect the U.S. dollar market value of the consideration that Metal Management stockholders will receive upon completion of the merger. There will be no adjustment to the exchange ratio for changes in the U.S. dollar — Australian dollar exchange rate. Neither company is permitted to terminate the merger agreement, and the Metal Management board of directors is not permitted to change its recommendation to its stockholders to approve the merger, solely because of changes in currency exchange rates. Following completion of the merger, fluctuations in the exchange rate between the U.S. dollar and the Australian dollar will continue to affect the U.S. dollar equivalent of the Australian dollar price of Sims ordinary shares listed on the ASX and the market price of Sims ADSs traded on the NYSE. Before deciding whether to vote for adoption of the merger agreement, you should obtain information regarding the U.S. dollar — Australian dollar exchange rate.
 
Stockholders in the United States may decide to sell Metal Management common stock or Sims ADSs, which could cause a decline in their respective market prices.
 
Some United States holders of Metal Management common stock may be disinclined to own shares of a company that is organized and has its primary listing outside of the United States. This could result in the sale of Metal Management shares prior to the completion of the merger or the sale of Sims ADSs received in the merger, some of which may be purchased by Australian and other non-U.S. investors. In addition, the market price of Metal Management common stock, Sims ordinary shares and Sims ADSs may be adversely affected by arbitrage activities occurring prior to the completion of the merger. These sales, or the prospects of such


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sales in the future, could adversely affect the market price for, and the ability to sell in the market, shares of Metal Management common stock before the merger is completed and Sims ADSs after the merger is completed.
 
Sims ADSs may not be as liquid as Metal Management common stock.
 
Some companies that have issued ADSs on United States stock exchanges have experienced lower levels of liquidity in their ADSs than is the case for their ordinary shares listed on their domestic exchange. There is a possibility that Sims ADSs will be less liquid than Sims ordinary shares listed on the ASX or less liquid than Metal Management common stock. In addition, investors may incur higher transaction costs when buying and selling Sims ADSs than they would incur in buying and selling Metal Management common stock.
 
The rights of holders of Sims ADSs to be issued in the merger will not be the same as the rights of holders of Metal Management common stock or Sims ordinary shares.
 
Metal Management is a corporation organized under the laws of Delaware. The rights of holders of Metal Management common stock are governed by the Delaware General Corporation Law, the certificate of incorporation and bylaws of Metal Management and the listing rules of the NYSE. Sims is a company organized under the laws of Australia. Upon completion of the merger, the former holders of Metal Management common stock will receive Sims ADSs, which represent a beneficial ownership interest in Sims ordinary shares. The rights of holders of Sims ADSs will be governed by the Australian Corporations Act 2001 (Cth), which is referred to as the Corporations Act, Sims’s constitution, the listing rules of the ASX and the NYSE and the deposit agreement pursuant to which the ADSs will be issued. There are differences between the rights presently enjoyed by holders of Metal Management common stock and the rights to which the holders of Sims ADSs will be entitled following the merger. In some cases, the holders of Sims ADSs to be issued in the merger may not be entitled to important rights to which they would have been entitled as holders of Metal Management common stock. The rights and terms of the Sims ADSs are designed to replicate, to the extent reasonably practicable, the rights attendant to Sims ordinary shares, for which there is currently no active trading market in the United States. However, because of aspects of Australian law, Sims’s constitution and the terms of the deposit agreement under which the Sims ADSs will be issued, the rights of holders of Sims ADSs will not be identical to and, in some respects, may be less favorable than, the rights of holders of Sims ordinary shares. For more information regarding the characteristics of, and differences between, Metal Management common stock, Sims ordinary shares and Sims ADSs, please refer to “Description of Sims Ordinary Shares,” “Description of Sims American Depositary Shares,” and “Comparative Rights of Stockholders.”
 
After the completion of the merger, the market price of Sims ADSs may not be identical, in U.S. dollar terms, to the market price of Sims ordinary shares.
 
While the market price of Sims ADSs is expected to fluctuate according to the market price of Sims ordinary shares and according to changes in the U.S. dollar — Australian dollar exchange rate, there is no guarantee that this relationship will be observed at all times, or at any time. The market price of Sims ADSs may differ from the market price of Sims ordinary shares in U.S. dollar terms for a number of reasons, including the relative liquidity of Sims ADSs and Sims ordinary shares.
 
After the completion of the merger, the market price of Sims ordinary shares may be affected by different factors than those currently affecting Sims ordinary shares or Metal Management common stock.
 
The businesses of Sims and Metal Management differ in some respects and, accordingly, the results of operations of the combined company following the consummation of the merger and the market price of Sims ordinary shares and Sims ADSs following the transaction may be affected by factors different from those currently affecting the independent results of operations of each of Sims and Metal Management. In particular, Sims operates significant businesses outside of the United States and has a greater exposure to markets and economies outside the United States than Metal Management currently does. For a discussion of the businesses of Sims and Metal Management and of certain factors to consider in connection with those businesses, see


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“The Companies — Sims,” “The Companies — Metal Management, Inc.” and the documents incorporated by reference in this document and referred to under “Where You Can Find More Information.”
 
Sims Metal Management will experience significant changes in the composition of its board of directors and senior management as a result of the merger, which could result in disruption in its business and delay or prevent the successful integration of the businesses of Sims and Metal Management.
 
Following completion of the merger, Sims Metal Management will experience significant changes in the composition of its board of directors and senior management. The board of directors of the combined company will be expanded to 12 members, with the current directors of Metal Management joining the Sims Metal Management board. In addition, Metal Management’s current chief executive officer and chief financial officer will become the chief executive officer and chief financial officer of Sims Metal Management following the merger. After the merger, the executive offices of Sims Metal Management will be relocated to New York, New York, while the group accounting consolidation and external financial reporting processes will be progressively relocated to the United States until approximately September 2008. The success of Sims Metal Management following the merger will depend, to a significant extent, on the performance of its new board of directors and senior management team. Following the merger, Sims Metal Management will be subject to risks associated with its post-transaction management structure, including risks relating to officer and employee integration, potential loss of the services of key officers or employees, managerial efficiency and effectiveness and familiarity with the combined business and operations. In addition, Sims Metal Management will be subject to risks associated with the division of management responsibilities between Mr. Dienst, who will become group chief executive officer and chair of the combined North American metal recycling business, and Mr. Sutcliffe, who will continue as an executive director and will chair Sims Metal Management’s metal recycling business in Australasia and Europe as well as Sims Recycling Solutions globally. While the respective roles of Mr. Dienst and Mr. Sutcliffe have been delineated, there is a risk that the management structure will not yield the intended benefits and may cause difficulties for the execution of group strategies.
 
Sims Metal Management will be a “foreign private issuer” under the rules and regulations of the SEC and, as a result, will be exempt from a number of rules under the Exchange Act and will be permitted to file less information with the SEC than a company incorporated in the United States.
 
Following completion of the merger, Sims Metal Management will continue to be incorporated in Australia and will be deemed to be a “foreign private issuer” under the rules and regulations of the SEC. As a foreign private issuer, Sims Metal Management will be exempt from certain rules under the Exchange Act that would otherwise apply if Sims Metal Management were a company incorporated in the United States, including:
 
  •  the requirement to file periodic reports and financial statements with the SEC as frequently or as promptly as United States companies with securities registered under the Exchange Act;
 
  •  the requirement to file financial statements prepared in accordance with U.S. GAAP;
 
  •  the proxy rules, which impose certain disclosure and procedural requirements for proxy solicitations; and
 
  •  the requirement to comply with Regulation FD, which imposes certain restrictions on the selective disclosure of material information.
 
In addition, Sims Metal Management’s officers, directors and principal shareholders will be exempt from the reporting and “short-swing” profit recovery provisions of Section 16 of the Exchange Act and the related rules with respect to their purchases and sales of Sims ordinary shares and Sims ADSs. Accordingly, after the completion of the merger, if you hold Sims ADSs, you may receive less information about the combined company than you currently receive about Metal Management and be afforded less protection under the United States federal securities laws than you are entitled to currently.
 
In addition, if Sims Metal Management loses its status as a foreign private issuer that is exempt from such SEC reporting obligations at some future time, then it will no longer be exempt from such rules and,


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among other things, will be required to file periodic reports and financial statements as if it were a company incorporated in the United States. The costs incurred in fulfilling these additional regulatory requirements could be substantial.
 
As a foreign private issuer, Sims Metal Management will not be required to comply with most of the corporate governance standards of the NYSE applicable to companies incorporated in the United States.
 
Following completion of the merger, the Sims Metal Management board of directors will be required to maintain an audit committee comprised solely of three or more directors satisfying the independence standards of the NYSE applicable to audit committee members. As a foreign private issuer, however, Sims Metal Management will not be required to comply with most of the other corporate governance rules of the NYSE, including the requirement to maintain a majority of independent directors, and nominating and compensation committees of its board of directors comprised solely of independent directors. Holders of Sims ADSs may therefore not be afforded the benefits of the corporate governance standards of the NYSE applicable to companies incorporated in the United States.
 
Following the completion of the merger, Sims Metal Management will continue to prepare its financial statements using Australian dollars as its reporting currency.
 
Sims Metal Management will continue to use the Australian dollar as its financial statement reporting currency following completion of the merger. Sims Metal Management’s financial results reported in Australian dollars may differ materially from its results if reported in U.S. dollars due to changes in the exchange rates of the Australian dollar, the U.S. dollar and the currencies of other countries in which Sims Metal Management does business. Future changes in currency exchange rates could have a material adverse effect on Sims Metal Management’s financial results.
 
Sims’s largest shareholder will have significant influence after the merger over transactions requiring shareholder approval.
 
Mitsui Raw Materials Development Pty Limited currently holds approximately 19.9% of the outstanding ordinary shares of Sims and is Sims’s largest shareholder. Under Sims’s constitution, Mitsui & Co., Ltd and any of its related bodies corporate, which are collectively referred to as Mitsui, have the right to designate a representative director to serve on the Sims board of directors so long as Mitsui holds 5% or more of Sims ordinary shares and, so long as Mitsui holds 15% or more of Sims ordinary shares, then Mitsui has the right to designate both a representative director and an independent director to serve on the Sims board of directors. Under Sims’s constitution, Mitsui also has a 12-month period in which to reestablish a 15% or greater shareholding in Sims and retain its additional board designation right if its interest is diluted under certain circumstances. These rights of Mitsui will continue to be binding on Sims Metal Management following the merger. Immediately after the merger, Mitsui is expected to hold approximately 14% of the ordinary shares of Sims Metal Management and will therefore have the right to designate a representative director to serve on the Sims board of directors. Under an agreement with Sims, Mitsui is entitled to retain its right to designate an additional independent director if it reestablishes a 15% or greater shareholding in Sims Metal Management within 12 months after the date of completion of the merger. Mitsui may therefore decide to increase its shareholding in Sims Metal Management in order to maintain its additional board designation right. As a result, after the completion of the merger, Mitsui may increase its shareholding in Sims Metal Management, which would give Mitsui significant influence over transactions requiring approval of Sims Metal Management’s shareholders. Mitsui may have interests with respect to its investment in Sims Metal Management that are different from, or in addition to, the interests of other holders of Sims ordinary shares or Sims ADSs. The extent of Mitsui’s shareholding in Sims Metal Management could also have the effect of discouraging offers to acquire control of Sims Metal Management and may preclude holders of Sims ordinary shares or Sims ADSs from receiving any premium above the market price for their shares that may be offered in connection with any attempt to acquire control of Sims Metal Management.


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The merger agreement limits Metal Management’s ability to pursue alternatives to the merger.
 
The merger agreement contains non-solicitation provisions that, subject to limited exceptions, restrict Metal Management’s ability to discuss, facilitate or commit to competing third-party proposals to acquire all or a significant part of Metal Management. Further, there are only limited exceptions to Metal Management’s agreement that the Metal Management board of directors will not withdraw or modify in a way adverse to Sims its recommendation to Metal Management’s stockholders that they vote in favor of the merger, or recommend any other acquisition proposal. Although the Metal Management board of directors is permitted to take these actions in connection with receipt of an unsolicited superior acquisition proposal from another party if it determines that the failure to do so would be reasonably likely to result in a breach of its fiduciary duties, doing so under certain circumstances would entitle Sims to terminate the merger agreement and to receive a termination fee in the amount of $25 million. See “The Merger Agreement — Termination Fee and Expense Reimbursement.” Sims required Metal Management to agree to these provisions as a condition to Sims’s willingness to enter into the merger agreement. However, these provisions might discourage a potential competing acquirer that might have an interest in acquiring all or a significant part of Metal Management from considering or proposing that acquisition, even if it were prepared to pay consideration with a higher per share market price than that proposed in the merger, or it might result in a potential competing acquirer proposing to pay a lower per share price to acquire Metal Management than it might otherwise have proposed to pay.
 
Metal Management’s executive officers and directors have financial interests in the merger that are different from, or in addition to, your interests.
 
Executive officers of Sims and Metal Management negotiated the terms of the merger agreement, and the Metal Management board of directors approved and recommended that Metal Management’s stockholders vote to adopt the merger agreement. In considering these facts and the other information contained in this document, you should be aware that Metal Management’s executive officers and directors have financial interests in the transaction that are different from, or in addition to, the interests of Metal Management’s stockholders. For instance, each outstanding unvested Metal Management stock option and share of restricted stock held by any director, officer or employee will become fully vested upon completion of the merger. Also, Metal Management’s chief executive officer and chief financial officer have entered into modifications to their respective employment agreements pursuant to which their compensation will increase following the merger. The Metal Management board of directors was aware of these interests and considered them, among other matters, in approving the merger agreement and the transactions contemplated thereby. See “The Merger — Interests of Directors and Executive Officers in the Merger” for information about these financial interests.
 
The merger is subject to the receipt of consents and approvals from government entities that may impose conditions that could have an adverse effect on Sims Metal Management and the failure to obtain any such consent or approval may result in the termination of the merger.
 
Before the merger may be completed, consents, authorizations, orders and approvals of or filings with various governmental commissions, boards or other regulatory authorities in the United States and certain other countries must be obtained. These governmental entities, including the Antitrust Division of the United States Department of Justice and the United States Federal Trade Commission, may impose conditions on the completion of the merger or require changes to the terms of the merger. While Sims and Metal Management do not currently expect that any such conditions or changes will be imposed, there can be no assurance that there will not be, and such conditions or changes could have the effect of delaying completion of the merger or imposing additional costs on, or limiting the revenues of, the combined company, any of which might have a material adverse effect on the combined company following completion of the merger. Each of Sims and Metal Management is obligated to use its reasonable best efforts to obtain all such governmental consents and approvals, but neither party is obligated to enter into any agreement or take any other action in order to obtain any such governmental consent or approval if such agreement or action would result in reduction of 5% or more of the aggregate tonnage of ferrous metal processed, on an annual basis, by Sims and Metal Management, taken as a whole, compared with the operations of Sims and Metal Management for the 12 months ended June 30, 2007, or would otherwise have a material adverse


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effect on the business of Sims or Metal Management or on the ability of Sims or Metal Management to consummate the merger and perform their respective obligations under the merger agreement.
 
Risks Relating to the Operations of Sims Metal Management Following the Merger
 
Set forth below are risks that the boards of directors of Sims and Metal Management believe may be material to the combined business operations of Sims Metal Management after completion of the merger. Additional risks and uncertainties that are presently unknown or deemed to be immaterial may also impair the business operations of the combined company after completion of the merger.
 
The parties may not realize all of the anticipated benefits of the merger.
 
The success of the merger will depend, in part, on the ability to realize the anticipated benefits from combining the businesses of Sims and Metal Management. However, to realize these anticipated benefits, Sims and Metal Management must successfully combine their businesses, which are currently principally conducted in different countries by management and employees coming from different cultural backgrounds. If Sims and Metal Management are not able to achieve these objectives, the anticipated benefits of the transaction may not be realized fully, may take longer to realize than expected or may not be realized at all. Sims and Metal Management have operated and, until the completion of the merger, will continue to operate, independently. It is possible that the integration process could result in the loss of key employees, the disruption of each company’s ongoing businesses or inconsistencies in standards, controls, procedures and policies that adversely affect the ability of the combined company to maintain relationships with customers, suppliers and employees or to achieve the anticipated benefits of the merger. Integration efforts between the two companies will also divert management’s attention and resources. These integration matters could have an adverse effect on each of Metal Management and Sims during the transition period and on the combined company following completion of the merger.
 
The metal recycling industry has historically been, and is expected to remain, highly cyclical and demand from individual export markets, which will be important to Sims Metal Management, is volatile.
 
The operating results of the metal recycling industry, in general, have historically been, and are expected to remain, highly cyclical in nature and Sims Metal Management’s operations, specifically, are expected to be highly cyclical in nature. The results of Sims Metal Management’s operations will tend to reflect, and be amplified by, changes to general economic conditions, both domestically and internationally. Historically, in periods of recession or periods of slowing economic growth, the results from operations of metal recycling companies have been materially and adversely affected. For example, during recessions or periods of slowing economic growth, the automobile and the construction industries typically experience major cutbacks in production, resulting in decreased demand for steel, copper and aluminum, and it would be expected that, during such periods, there would be significant fluctuations in demand and pricing for Sims Metal Management’s products. Economic downturns in the United States or internationally will likely materially and adversely affect Sims Metal Management’s results of operations and financial condition. Sims Metal Management’s ability to withstand significant economic downturns or recessions in the future will depend, in part, on its level of capital and liquidity at the time. Sims Metal Management’s business may also be adversely affected by increases in steel imports into the United States or other significant market regions, such as Australia, the United Kingdom and New Zealand, which may have an adverse impact on steel production in such market regions and a corresponding adverse impact on the demand for recycled metals from some of Sims Metal Management’s facilities within such market regions. Additionally, the combined company’s business could be negatively affected by changes in currency exchange rates, changes in tariffs, or increased freight costs which could negatively impact export sales or attract imports of recycled metal or metal substitutes, reducing demand for the combined company’s recycled metals. When metals markets weaken, if Sims Metal Management is unable to reduce its costs commensurately, the combined company could experience a material decline in earnings. A material decline in earnings could negatively affect cash flows and capitalization and the market price for Sims ordinary shares and Sims ADSs.


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Sims Metal Management will be subject to significant risks relating to changes in commodity prices, currency exchange rates and interest rates, and may not be able to effectively protect against these risks.
 
Sims Metal Management will be exposed to commodity price risk during the period that it has title to products that are held in inventory for processing or resale. Prices of commodities, including recycled metals, can be volatile due to numerous factors beyond the combined company’s control. In an increasing price environment for raw materials, competitive conditions may limit Sims Metal Management’s ability to pass on price increases to its consumers. In a decreasing price environment for processed recycled metal, the combined company may not have the ability to fully recoup the cost of raw materials it procures, processes and sells to its customers. New entrants into its markets could result in higher purchase prices for raw materials and lower margins from its recycled metal. Sims Metal Management will not be able to hedge positions in certain commodities, such as recycled ferrous metal, where no established futures market exists. Thus, Sims Metal Management’s sales and inventory position will be vulnerable to adverse changes in commodity prices, which could materially adversely impact the combined company’s operating and financial performance. Sims Metal Management will operate a global trading business that is involved in the purchase and sale of ferrous steel making raw materials without a corresponding sale or purchase. At any one time, this global trading business may have a material number of “open” or at risk trading positions. To the extent that markets move in an adverse direction and Sims Metal Management has not hedged its position, this will have an adverse impact on profitability. As a company that will operate in many countries, Sims Metal Management will also be exposed to movements in currency exchange rates, the impact of which cannot be reliably predicted. Following completion of the merger, Sims Metal Management will report its financial results in Australian dollars. The combined company will have significant assets, liabilities and earnings denominated in currencies other than the Australian dollar, in particular U.S. dollars, pounds sterling and euros. These assets, liabilities and earnings, therefore, will be exposed to fluctuations in exchange rates between these currencies and the Australian dollar. Currency exchange rates have been extremely volatile in recent periods. In addition, Sims Metal Management will have significant indebtedness for borrowed money, some or all of which may provide for variable interest rates. It may not be possible for Sims Metal Management to effectively hedge against changes in interest rates at all or on an economically reasonable basis. Increases in interest rates could materially increase the borrowing costs of the combined company and could have a material adverse effect on its results of operations and financial condition.
 
The loss of export sales could adversely affect the results of operations and financial condition of Sims Metal Management.
 
A significant portion of the sales of recycled metal by Sims Metal Management following completion of the merger is expected to be exported to markets outside of the United States and Australia, with significant sales to customers in China, Turkey, India, Malaysia and other individual markets. If sales to these individual markets were to decline significantly for any reason and alternative markets could not be found at comparable market prices, it could materially adversely affect the results of operations and financial condition of Sims Metal Management. Other risks associated with the export business of the combined company include, among other factors, political and economic factors, economic conditions in the world’s economies, changes in legal and regulatory requirements, changes in currency exchange rates applicable to the U.S. dollar, Australian dollar and the currencies of other countries in which Sims Metal Management operates, purchases or exports recycled metal, freight costs and customer collection risks. Any of these factors could result in lower export sales, which could have a material adverse effect on the results of operations and financial condition of Sims Metal Management.
 
Sims Metal Management will be subject to increasing competition from containerized recycled metal exports.
 
Sims Metal Management will generate a significant proportion of its earnings from the export of recycled metals. Recently, there has been a significant increase in the number of empty containers at ports in the United States, Australia, the United Kingdom and elsewhere which may be used for exporting materials at a relatively low cost because vessel operators provide lower freight costs to container shippers relative to bulk


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shippers. Small recycled metal operators have taken advantage of this situation by exporting significant quantities of recycled metals in containers in competition with Sims and Metal Management. The increasing competition from containerized recycled metal exports may reduce Sims Metal Management’s export gross margin on sales or volumes and, accordingly, may have a material adverse impact on the results of operations and financial condition of Sims Metal Management.
 
The concentration of the customers of Sims Metal Management or the termination of material customer contracts could have a material adverse effect on the results of operations and financial condition of the combined company.
 
Sales to the 10 largest customers of Sims and Metal Management represented approximately 25% of combined consolidated net sales on a pro forma basis for the 12-month period ended June 30, 2007. Accounts receivable balances from these customers comprised approximately 20% of combined consolidated accounts receivable on a pro forma basis as of June 30, 2007. Sims and Metal Management have not generally had long term contracts with their customers and it is not expected that Sims Metal Management will have a significant number of long term contracts with its customers following completion of the merger. The customers of Sims Metal Management will therefore generally have the ability to terminate or modify their contracts with the combined company on short notice without the payment of penalties or other amounts. The loss of significant customers of the combined company, a deterioration in the financial condition of significant customers of the combined company, or the termination of one or more material customer contracts could have a material adverse effect on the results of operations and financial condition of Sims Metal Management.
 
Potential credit losses from Sims Metal Management’s significant customers could adversely affect the combined company’s results of operations and financial condition.
 
In connection with the sale of products, Sims Metal Management generally will not require collateral as security for customer receivables nor will it necessarily purchase credit insurance. Sims Metal Management and certain of its subsidiaries may have significant balances owing from customers that operate in cyclical industries and under leveraged conditions that may impair the collectibility of those receivables. Failure to collect a significant portion of amounts due on those receivables could have a material adverse effect on Sims Metal Management’s results of operations and financial condition.
 
The profitability of the metal recycling operations of Sims Metal Management will depend, in part, on the availability of an adequate source of supply.
 
Following completion of the merger, Sims Metal Management will procure its recyclable metal inventory from numerous sources, as each of Sims and Metal Management has done historically. These suppliers generally are not bound by long-term contracts and will have no obligation to sell recyclable metal to the combined company. In periods of low industry prices, suppliers may elect to hold recyclable metal to wait for higher prices or intentionally slow their metal collection activities. If a substantial number of suppliers cease selling recyclable metal to Sims Metal Management, the combined company will be unable to recycle metals at desired levels and its results of operations and financial condition could be materially adversely affected. In addition, a slowdown of industrial production in the United States or certain other countries would reduce the supply of industrial grades of metal to the metal recycling industry, resulting in Sims Metal Management having less recyclable metal available to process and market.
 
A significant increase in the use of substitute materials by consumers of processed recycled ferrous metal could reduce demand for the products of Sims Metal Management.
 
During periods of high demand, tightness can develop in the available supply of recycled ferrous metal. The relative scarcity of recycled ferrous metal, particularly prime or industrial grades, during such periods, provides opportunities for producers of substitute products, such as pig iron and direct reduced iron pellets. It cannot be assured that the use of substitutes to recycled ferrous metal will not proliferate in the future if the prices for recycled metal rise or if the supply of available unprepared ferrous metal tightens. A number of third parties around the world are working on ways to produce recycled ferrous metal substitutes. If these


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efforts prove successful, they could become significant competitors and materially adversely impact the results of operations and financial condition of Sims Metal Management.
 
Sims Metal Management’s operations will be subject to extensive governmental regulation in each of the jurisdictions in which it operates.
 
In each of the jurisdictions in which it will operate, Sims Metal Management will be subject to a variety of laws and regulations relating to trade, competition, taxes, employees and employee benefits, worker health and safety, land use, the environment and other matters. Sims Metal Management may be required to make significant expenditures and to devote substantial management time and attention in order to operate its business in compliance with such laws and regulations. In addition, changes in these laws or regulations or their interpretations or enforcement may require Sims Metal Management to make significant additional expenditures or to change its business practices. If Sims Metal Management fails to comply with applicable laws and regulations, it could incur criminal or civil fines, penalties, assessments or other damages, which could be substantial, and could have material restrictions or limitations placed on its business operations. In certain cases, governmental compliance actions may also give rise to potential claims for damages by private parties.
 
Sims Metal Management’s operations will be subject to stringent environmental laws and regulations.
 
Following completion of the merger, Sims Metal Management will be subject to comprehensive statutory and regulatory environmental requirements relating to, among others:
 
  •  the acceptance, storage, treatment, handling and disposal of solid, hazardous and toxic waste;
 
  •  the discharge of materials into the air;
 
  •  the management and treatment of wastewater and storm water;
 
  •  the remediation of soil and groundwater contamination; and
 
  •  the protection of employee health and safety.
 
The nature of Sims Metal Management’s business and previous operations by others at facilities currently or formerly owned or operated or otherwise used by the combined company will expose the combined company to risks of claims under environmental laws and regulations, especially for the remediation of soil or groundwater contamination. Sims Metal Management may be required to make material expenditures for remedial activities or capital improvements with regard to sites currently or formerly owned or operated or otherwise used by the combined company.
 
Environmental statutes and regulations have changed rapidly in recent years by requiring greater and more expensive protective measures, and it is possible that Sims Metal Management will be subject to even more stringent environmental standards in the future. For example, in many jurisdictions in which Sims Metal Management will operate, there is the potential for regulation and or legislation relating to mercury contaminants. Automobile hulks that are purchased and processed by the combined company may contain mercury switches. Legislation or regulations that may be enacted in the future cannot be presently known and neither can the effects, if any, that any such law or regulation could have on Sims Metal Management’s business. For these reasons and others, the future capital expenditures for pollution control equipment, remediation or other initiatives that may be required cannot be predicted with accuracy. However, it is generally expected that environmental standards will become increasingly more stringent and that the expenditures necessary to comply with those heightened standards will correspondingly increase.
 
Sims Metal Management will be required to maintain, and to comply with, various permits and licenses to conduct its operations. Failure to maintain, or violations of, any permit or license, if not remedied, could result in the combined company incurring substantial fines, suspension of operations or closure of a site. Further, Sims Metal Management’s operations are conducted primarily outdoors and, as such, depending on the nature of the ground cover, such outdoor operations will involve the risk of releases of wastes and other regulated materials to the soil and, possibly, to groundwater. As part of the combined company’s continuous improvement programs, the combined company will incur costs to improve environmental control systems.


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Because companies in the metal recycling industry have the potential for discharging wastes or other regulated materials into the environment, in any given year, a significant portion of Sims Metal Management’s capital expenditures could be related, directly or indirectly, to pollution control or environmental remediation.
 
The operations of Sims Metal Management will generate waste that will need to be treated, stored and disposed of in accordance with applicable environmental laws.
 
Sims Metal Management’s metal recycling operations will produce significant amounts of waste that it will be required to pay to have treated or discarded. For example, Sims Metal Management will operate shredders for which the primary feedstock is automobile hulks and obsolete household appliances. Approximately 20% of the weight of an automobile hulk consists of non-metallic material, commonly referred to as shredder fluff or automobile shredder residue, which is referred to as ASR, which constitutes the remnant material after the separation of saleable ferrous and non-ferrous metals. Environmental regulations in the United States and many other countries in which Sims Metal Management will operate will require that Sims Metal Management test ASR to determine if it is to be classified as hazardous waste before disposing of it off-site in permitted landfills. Sims Metal Management’s other waste streams in the United States and other countries in which it will operate will be subject to similar requirements. Additionally, Sims Metal Management will employ significant source control programs to ensure, to the fullest extent possible, that prohibited hazardous materials do not enter its raw materials stream. However, it cannot be assured that such materials will be successfully removed from Sims Metal Management’s source streams and resultant recycling by-products. As a result, Sims Metal Management’s waste streams may, from time to time, be classified as a hazardous waste in which case the combined company may incur higher costs for disposal of these waste products.
 
Environmental assessments, conducted by independent environmental consulting firms, of certain of the operating sites that Sims Metal Management will own upon the completion of the merger have revealed that some soil impacts, potentially including impacts associated with various metals, petrochemical by-products, waste oils, polychlorinated biphenyls, which are referred to as PCBs, and volatile organic compounds are, or may be, present at varying levels. It is likely that such impacts at varying levels may exist at some of the sites and it is expected that some of these sites could require investigation, monitoring and remediation in the future. The costs of such remediation could be significant. The existence of such impacts at some of the facilities of Sims Metal Management potentially could require the combined company to incur significant costs to remediate and could materially adversely affect the combined company’s ability to sell those properties.
 
Following completion of the merger, Sims Metal Management may have potential environmental investigation and cleanup liabilities.
 
Certain U.S. subsidiaries of Metal Management have received notices from the United States Environmental Protection Agency, which is referred to as the USEPA, state agencies or third parties that they have been identified as potentially responsible for the cost of investigation and cleanup of landfills or other sites where the subsidiary’s material was shipped. In most cases, many other parties are also named as potentially responsible parties. The Comprehensive Environmental Response, Compensation and Liability Act, which is referred to as CERCLA, enables USEPA and other United States’ regulatory agencies to recover from owners, operators, generators and transporters the cost of investigation and cleanup of sites which pose serious threats to the environment or public health. In certain circumstances, a potentially responsible party can be held jointly and severally liable for the cost of cleanup. In other cases, a party who is liable may only be liable for a divisible share. Liability can be imposed even if the party shipped materials in a lawful manner at the time of shipment. Liability for investigation and cleanup costs can be significant, particularly in cases where joint and several liability may be imposed. CERCLA, including the Superfund Recycling Equity Act of 1999, limits the exposure of metals recyclers for sales of certain recyclable material under certain circumstances. However, the recycling defense is subject to conducting reasonable care evaluations of current and potential consumers. Because CERCLA can be imposed retroactively on shipments that occurred many years ago, and because USEPA and state agencies are still discovering sites that present problems to public health or the environment,


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it cannot be assured that Sims Metal Management will not become liable in the future for significant costs associated with investigation and remediation of CERCLA waste sites.
 
Sims Metal Management will not have environmental impairment insurance.
 
In general, because it believes that the cost of the premiums outweighs the benefit of coverage, Sims Metal Management is not expected to carry environmental impairment liability insurance. If Sims Metal Management were to incur significant liability for environmental damage, such as a claim for soil or groundwater remediation, its results of operations and financial condition could be materially adversely affected.
 
Sims Metal Management’s operations will present risk of injury or death.
 
Because of the heavy industrial activities that will be conducted at Sims Metal Management’s facilities, there exists a risk of serious injury or death to Sims Metal Management’s employees or other visitors to its operations, notwithstanding the safety precautions that are taken. Sims Metal Management’s United States operations and its operations in certain other countries will be subject to regulation by governmental agencies responsible for employee health and safety. Sims and Metal Management currently have in place policies to minimize the risk to employees and other visitors to their respective facilities and, accordingly, to minimize the risk that Sims and Metal Management will incur government fines for violations of such regulations. Sims Metal Management may, nevertheless, be unable to avoid material liabilities for any death or injury that may occur in the future and these types of incidents may have a material adverse effect on Sims Metal Management’s results of operations and financial condition.
 
The loss of any member of the senior management team of Sims Metal Management or a significant number of its managers could have a material adverse effect on Sims Metal Management’s results of operations and financial condition.
 
After the completion of the merger, Sims Metal Management’s operations will depend heavily on the skills and efforts of its senior management team. In addition, Sims Metal Management will rely substantially on the experience of the management of its businesses with regard to day-to-day operations. While Sims Metal Management will have employment agreements with certain of the members of its senior management team, the combined company may be unable to retain the services of any of those individuals. The loss of any member of the senior management team of Sims Metal Management or a significant number of managers could have a material adverse effect on the combined company’s results of operations and financial condition.
 
Sims Metal Management may not be able to negotiate future labor contracts on favorable terms.
 
A significant percentage of Sims Metal Management’s employees will be represented by various labor unions. As the agreements with those unions expire, Sims Metal Management may not be able to negotiate extensions or replacements on terms favorable to it, or at all, or avoid strikes, lockouts or other labor actions from time to time. Therefore, it cannot be assured that new labor agreements will be reached with Sims Metal Management’s unions as those labor contracts expire or on terms that Sims Metal Management finds desirable. Any labor action resulting from the failure to reach an agreement with Sims Metal Management’s unions could have an adverse effect on the combined company’s results of operations and financial condition.
 
Sims Metal Management will be obligated to contribute to defined benefit pension plans, some of which are underfunded.
 
Metal Management and Sims currently contribute to defined benefit pension plans that cover various categories of employees and retirees. The obligation to make contributions to fund benefit obligations under these pension plans is based on actuarial valuations, which are based on certain assumptions, including the long-term return on plan assets and discount rate. Three of the Metal Management defined benefit pension plans were underfunded by approximately $1.8 million as of June 30, 2007. Sims Metal Management will have to make additional contributions following completion of the merger to fund its pension benefit plans. Contributions will negatively impact its cash flow and results of operations. In addition, Sims Metal


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Management will contribute to various multi-employer pension plans which cover employees under collective bargaining agreements. The required contributions are specified in such collective bargaining agreements. However, Sims Metal Management may be required to fund additional amounts in the future if one or more of these multi-employer plans do not meet the Employee Retirement Income Security Act funding guidelines. Additional contributions will negatively impact Sims Metal Management’s cash flow, results of operations and financial condition.
 
Sims Metal Management will incur higher expense related to the amortization of intangible assets and may be required to report losses resulting from the impairment of goodwill or other assets recorded in connection with the merger or other completed or future acquisitions.
 
The merger will be treated as an acquisition of Metal Management by Sims for accounting purposes. Both Sims and Metal Management have in the past expanded their operations through other acquisitions and joint ventures involving metal recycling businesses owned by third parties. Sims Metal Management expects to continue to complete selected acquisitions and joint venture transactions in the future. In connection with acquisition and joint venture transactions, applicable accounting rules generally require the tangible and certain intangible assets of the acquired business to be recorded on the balance sheet of the acquiror at their fair market value. Intangible assets other than goodwill will be required to be amortized over their estimated useful lives and this expense may be significant. Any excess in the purchase price paid by the acquiror over the fair market value of tangible and intangible assets of the acquired business is recorded as goodwill. If it is later determined that the anticipated future cash flows from the acquired business will be less than the fair market value of the assets and goodwill of the acquired business recorded at the time of the acquisition, the assets or goodwill may be deemed to be impaired. In this case, the acquiror may be required under applicable accounting rules to write down the value of the assets or goodwill on its balance sheet to reflect the extent of the impairment. This write down of assets or goodwill is generally recognized as a non-cash expense in the statement of operations of the acquiror for the accounting period during which the write down occurs. If Sims Metal Management determines that any of the assets or goodwill recorded in connection with the merger or any other prior or future acquisitions or joint venture transactions have become impaired, Sims Metal Management will be required to record a loss resulting from the impairment. The metal recycling industry is highly cyclical and, as a result, Sims Metal Management may be more likely than companies in other industries to incur impairment losses. Impairment losses could be significant and could have a material adverse effect on the results of operations and financial condition of Sims Metal Management, and could have a material adverse affect on its ability to pay dividends.
 
Since Sims was not subject to SEC rules prior to the merger, significant expenditures and senior management time may be required with respect to Sims Metal Management’s internal controls to ensure compliance with the requirements of Section 404 of the Sarbanes Oxley Act of 2002.
 
Section 404 of the Sarbanes Oxley Act of 2002 and the regulations of the SEC thereunder will require senior executive and senior financial officers of Sims Metal Management to assess the effectiveness of its internal control over financial reporting on an annual basis commencing with the 12-month period ending June 30, 2009. Sims Metal Management’s independent registered public accounting firm will also be required to provide a report with respect to Sims Metal Management’s internal control over financial reporting annually commencing with the 12-month period ending June 30, 2009. To the extent that Sims Metal Management is discovered to have deficient internal controls, the combined company may be required to allocate significant monetary and management resources to remedy the deficiencies that could otherwise be devoted to its business operations. Management for Sims and Metal Management believe that Sims Metal Management may incur additional expenditures of approximately $3 million in its first year after completion of the merger to ensure compliance with the requirements of Section 404 of the Sarbanes Oxley Act of 2002.
 
Sims Metal Management will be exposed to the risk of legal claims and other liabilities that may have a material adverse effect on its results of operations and financial condition.
 
Sims Metal Management will be exposed to the risk of legal claims and other liabilities arising in connection with the operation of its business that may have a material adverse effect on the results of operations and financial condition of Sims Metal Management. These claims and liabilities may include claims


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by employees or former employees relating to personal injury, compensation or employment law violations, environmental, land use and other claims arising out of the ownership or operation of facilities, and disputes with customers, suppliers and other business relations. The nature of Sims Metal Management’s business may make the company more likely than some other companies to be exposed to the risk of legal claims and other liabilities. In particular, metal recycling companies are generally exposed to higher risks of environmental claims and liabilities than companies in non-manufacturing industries, and employees working in the metal recycling industry may be more likely to suffer workplace injuries than employees of companies in other industries. The resolution of these claims and other liabilities may require Sims Metal Management to pay material damages or other costs to third parties, including potentially punitive, treble, exemplary or other special damages. Resolution of claims may also involve an extensive commitment of senior management time and attention, and may require changes in the business practices resulting in decreased revenues or profits or additional costs. Even if claims or other liabilities are resolved successfully, Sims Metal Management may incur significant legal and other expenses in defending against such matters.
 
The tax liabilities of Sims Metal Management may substantially increase if the tax laws and regulations in the countries in which it will operate change or become subject to adverse interpretations or inconsistent enforcement.
 
Taxes payable by companies in many of the countries in which Sims Metal Management will operate are substantial and include value added tax, excise duties, taxes on income (including profits and capital gains), payroll related taxes, property taxes and other taxes. Tax laws and regulations in some of these countries may be subject to frequent change, varying interpretation and inconsistent enforcement. In addition, many of the jurisdictions in which Sims Metal Management will operate have adopted transfer pricing legislation. If tax authorities impose significant additional tax liabilities as a result of transfer pricing adjustments, it could have a material adverse effect on Sims Metal Management’s results of operations and financial condition. It is possible that taxing authorities in the countries in which Sims Metal Management will operate will introduce additional revenue raising measures. The introduction of any such provisions may affect the overall tax efficiency of the combined company and could result in significant additional taxes becoming payable. Any such additional tax exposure could have a material adverse effect on Sims Metal Management’s results of operations and financial condition. Sims Metal Management may face a significant increase in its income taxes if tax rates increase or the tax laws or regulations in the jurisdictions in which it will operate or treaties between those jurisdictions are modified in an adverse manner. This may adversely affect Sims Metal Management’s cash flows, liquidity and ability to pay dividends.
 
The operations of Sims Metal Management will be subject to risks and uncertainties relating to international conflicts and terrorism.
 
Sims Metal Management will be subject to risks relating to international conflicts, wars, internal civil unrest, trade embargoes and acts of terrorism. Sims Metal Management may be subject to a higher level of risks of this type than some other companies due to its extensive international operations. These operations will include sales in developing countries, which may be more likely than developed countries to be affected by international conflicts and terrorism. Risks of this type may affect facilities owned or operated by Sims Metal Management or facilities of its suppliers or customers. In addition, risks of this type may affect port facilities or other transportation infrastructure owned or used by Sims Metal Management in the operation of its business.
 
United States investors may have difficulty enforcing civil liabilities against Sims Metal Management and its directors and senior management.
 
Sims Metal Management will be organized under the laws of Australia. Following the merger, several of Sims Metal Management’s directors and many members of its senior management will be residents of jurisdictions outside the United States. A significant portion of Sims Metal Management’s assets and the assets of these persons will be located outside the United States. As a result, United States investors may find it difficult to effect service of process within the United States upon Sims Metal Management or these persons or to enforce outside the United States judgments obtained against Sims Metal Management or these persons in United States courts, including actions predicated upon the civil liability provisions of the United States


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federal securities laws. Likewise, it may also be difficult for an investor to enforce in United States courts judgments obtained against Sims Metal Management or these persons in courts in jurisdictions outside the United States, including actions predicated upon the civil liability provisions of the United States federal securities laws. It may also be difficult for a United States investor to bring an original action in an Australian court predicated upon the civil liability provisions of the United States federal securities laws against the combined company’s directors and senior management and non-United States experts named in this proxy statement/prospectus.


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CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING INFORMATION
 
This proxy statement/prospectus contains or incorporates by reference a number of forward-looking statements, including statements about the financial conditions, results of operations, earnings outlook and prospects of Sims, Metal Management and Sims Metal Management and may include statements for the period following completion of the merger. Forward-looking statements are typically identified by words such as “plan,” “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project” and other similar words and expressions.
 
The forward-looking statements involve certain risks and uncertainties. The ability of either Sims or Metal Management to predict results or the actual effects of its plans and strategies, or those of Sims Metal Management, is subject to inherent uncertainty. Factors that may cause actual results or earnings to differ materially from such forward-looking statements include those set forth above under “Risk Factors” and those discussed and identified in filings made with the SEC by Metal Management.
 
Because these forward-looking statements are subject to assumptions and uncertainties, actual results may differ materially from those expressed or implied by these forward-looking statements. You are cautioned not to place undue reliance on these statements, which speak only as of the date of this proxy statement/prospectus or the date of any document incorporated by reference in this proxy statement/prospectus.
 
Factors that could cause actual results to differ materially from those contemplated by the forward-looking statements include, among others, the following factors:
 
  •  the ability to consummate the merger, including difficulties and delays in obtaining regulatory approvals for the merger and in meeting the other conditions set forth in the merger agreement;
 
  •  the failure of the parties to realize the anticipated benefits of the merger;
 
  •  cyclicality and volatility in the metal recycling industry;
 
  •  exposure to changes in commodity prices, currency exchange rates and interest rates;
 
  •  loss of export sales and increased competition from containerized recycled metal exports;
 
  •  concentration of customers and exposure to customer credit risks;
 
  •  availability of adequate sources of material supply;
 
  •  failures to comply with or other liabilities incurred pursuant to applicable laws, including applicable environmental laws;
 
  •  the loss of senior executive employees or managers;
 
  •  labor problems;
 
  •  costs and risks associated with defined benefit pension plans and other employee benefits;
 
  •  goodwill impairment and other financial and accounting issues;
 
  •  compliance costs and other risks relating to internal control over financial reporting;
 
  •  existing and future litigation; and
 
  •  the risks of global operations, including international hostilities.
 
All subsequent written and oral forward-looking statements concerning the transaction or other matters addressed in this proxy statement/prospectus and attributable to Sims or Metal Management or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this proxy statement/prospectus. Except to the extent required by applicable law or regulation, Sims and Metal Management undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date of this proxy statement/prospectus or to reflect the occurrence of unanticipated events.


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THE METAL MANAGEMENT SPECIAL STOCKHOLDERS MEETING
 
Date, Time, and Place
 
The special meeting of Metal Management stockholders will be held at 10:00 a.m., local time, on March 14, 2008, at the offices of King & Spalding LLP, 1185 Avenue of the Americas, 34th Floor, New York, New York.
 
Matters to be Considered
 
At the Metal Management special meeting, Metal Management stockholders will be asked:
 
  •  To consider and vote on the proposal to adopt the merger agreement.
 
  •  To approve adjournments of the Metal Management special meeting, if necessary, to permit further solicitation of proxies if there are not sufficient votes at the time of the Metal Management special meeting to approve the proposal.
 
  •  To consider and take action upon any other business that may properly come before the Metal Management special meeting or any reconvened meeting following an adjournment of the special meeting.
 
Record Date; Shares Entitled to Vote; Outstanding Shares
 
The record date for the special meeting is January 25, 2008. This means that you must have been a stockholder of record of Metal Management’s common stock at the close of business on that date in order to vote at the special meeting. You are entitled to one vote for each share of Metal Management common stock you own. On Metal Management’s record date, Metal Management had 26,141,746 shares of common stock outstanding.
 
A complete list of Metal Management stockholders entitled to vote at the Metal Management special meeting will be available for inspection at the executive offices of Metal Management during regular business hours no less than ten days prior to the special meeting.
 
Vote Required for Approval
 
The affirmative vote of the holders of a majority of the outstanding shares of Metal Management common stock entitled to vote at the special meeting as of the record date, voting either in person or by proxy, is necessary for adoption of the merger agreement. If necessary, approval of a proposal to adjourn the Metal Management special meeting for the purpose of, among other things, soliciting additional proxies requires the affirmative vote of the holders of a majority of the shares of Metal Management common stock present in person or represented by proxy and entitled to vote at the special meeting, whether or not a quorum is represented.
 
The holders of a majority of the total number of outstanding shares of Metal Management common stock entitled to vote as of the record date, represented either in person or by proxy, will constitute a quorum at the Metal Management special meeting.
 
Manner of Voting
 
If you are a Metal Management stockholder you may vote for or against the proposals submitted at the Metal Management special meeting in person.
 
If you do not wish to vote in person or you will not be attending the special meeting, you may vote by proxy. You may vote by proxy over the Internet, over the telephone or by mail. The procedures for voting by proxy are as follows:
 
  •  To vote by proxy on the Internet, go to http://proxy.georgeson.com to complete an electronic proxy card.


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  •  To vote by proxy over the telephone, dial the toll-free phone number listed on your proxy card under the heading “Telephone” using a touch-tone phone and follow the recorded instructions.
 
  •  To vote by proxy using the enclosed proxy card, complete, sign and date your proxy card and return it promptly in the envelope provided.
 
If you vote by proxy on the Internet or by telephone, your vote must be received by 11:59 p.m., United States Eastern time, on March 13, 2008 to be counted.
 
Metal Management is providing Internet proxy voting to allow you to vote your shares on-line, with procedures designed to ensure the authenticity and correctness of your proxy vote instructions. However, please be aware that you must bear any costs associated with your Internet access, such as usage charges from Internet access providers and telephone companies.
 
All shares entitled to vote and represented by properly completed proxies received prior to the Metal Management special meeting, and not revoked, will be voted at the Metal Management special meeting as instructed on the proxies. If you do not indicate how your shares should be voted on a matter, the shares represented by your properly completed proxy will be voted “FOR” adoption of the merger agreement and as the Metal Management board of directors recommends on any other proposals properly brought before the special meeting.
 
Revoking a Proxy
 
You may revoke your proxy at any time before it is exercised by timely delivering a properly executed, later-dated proxy (including over the Internet or telephone), delivering a notice of revocation to Metal Management’s corporate secretary, or by voting by ballot at the Metal Management special meeting. Simply attending the Metal Management special meeting without voting will not revoke your proxy.
 
Shares Held in “Street Name”
 
If your shares of Metal Management common stock are held in an account at a broker, bank or other nominee and you wish to vote, you must return your instructions to the broker, bank or nominee. If you do not provide your broker with instructions, your broker will not be authorized to vote on the proposal to approve the merger agreement and the plan of merger contained therein. This will have the same effect as a vote against the proposal.
 
If you wish to vote on the proposal to approve adjournments of the Metal Management special meeting, you should provide instructions to your broker. If you do not provide instructions to your broker, your broker will not be authorized to vote on any proposal to adjourn the special meeting solely relating to the solicitation of proxies to approve the merger agreement and the plan of merger contained therein.
 
If you own shares of Metal Management common stock through a broker, bank or other nominee and attend the Metal Management special meeting, you should bring a letter from your broker, bank or other nominee identifying you as the beneficial owner of such shares of Metal Management common stock and authorizing you to vote.
 
Solicitation
 
This solicitation is made on behalf of the Metal Management board of directors. Metal Management will be responsible for all costs of soliciting proxies, including charges made by brokers and others holding common stock in their names or in the names of nominees, for reasonable expense incurred in sending proxy materials to beneficial owners and obtaining their proxies. In addition to solicitation by mail, directors, officers and employees of Metal Management may solicit proxies personally and by telephone, all without extra compensation. Metal Management has engaged the firm of Georgeson Inc. to assist Metal Management in the distribution and solicitation of proxies, which will be paid a fee of $10,000 plus out-of-pocket expenses for its services.


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Assistance
 
Stockholders who have questions regarding the materials, need assistance voting their shares or require additional copies of the proxy statement or proxy card should contact or call (toll-free):
 
Georgeson Inc.
17 State Street
New York, New York 10004
Telephone: (866) 288-2196
Facsimile: (212) 440-9009
 
Other Business
 
We are not currently aware of any business to be acted upon at the Metal Management special meeting other than matters discussed in this proxy statement/prospectus. Under the Delaware General Corporation Law, business transacted at the special meeting is limited to matters specifically designated in the notice of special meeting, which is provided at the beginning of this proxy statement/prospectus. If other matters do properly come before the special meeting, Metal Management intends that shares of its common stock represented by properly submitted proxies will be voted by persons named as proxies on the proxy card in accordance with the recommendation of Metal Management’s board of directors.


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THE MERGER
 
The following discussion contains material information pertaining to the merger. This discussion is subject and qualified in its entirety by reference to the merger agreement and the related documents attached as Appendices to this proxy statement/prospectus. You should read the entirety of those documents as well as the discussion in this proxy statement/prospectus.
 
Structure of the Merger
 
The merger agreement provides for the merger of Metal Management and MMI Acquisition Corporation. Upon completion of the merger, the separate corporate existence of MMI Acquisition Corporation will cease and Metal Management will continue as the surviving entity and as a wholly owned subsidiary of Sims. The combined company will be renamed “Sims Metal Management Limited,” subject to approval by the holders of Sims ordinary shares. At the effective time of the merger, each issued and outstanding share of Metal Management common stock will be converted into the right to receive 2.05 Sims ADSs, with each Sims ADS representing one Sims ordinary share.
 
Upon completion of the merger, it is estimated that Metal Management’s former stockholders will own approximately 30% and Sims’s shareholders will own approximately 70% of the then combined outstanding Sims ordinary shares and ADSs. Sims’s shareholders will continue to own their existing shares, which will not be changed by the merger. Sims ordinary shares will continue to be listed on the ASX under the trading code “SGM” and, upon completion of the merger, Sims ADSs will be listed on the NYSE under the trading symbol “SMS.” Upon completion of the merger, Metal Management common stock, which is listed on the NYSE under the trading symbol “MM,” will be delisted.
 
Background of the Merger
 
At various times over the years, the board of directors of each of Sims and Metal Management has considered the possibility of acquisitions, combinations and other business strategies and has engaged with senior management in strategic reviews, with a goal of enhancing shareholder value. Moreover, each company has engaged in a number of acquisitions over the last several years.
 
In late 2006, against the backdrop of a rapidly changing and evolving global commodities landscape, Mr. Dienst asked Robert Lewon, a Metal Management board member who was a former Sims executive, to arrange a meeting and dialogue with Mr. Sutcliffe. The intentions at that time were to learn about the culture and long-term plans of a public peer and to determine if there were similar goals for creating value for their respective shareholders. On April 17, 2007, Messrs. Dienst and Sutcliffe met informally and discussed in general terms the possibility of Sims and Metal Management entering into a business combination involving Sims’s North American metal recycling operations. They agreed to continue to discuss the possibility of a business combination.
 
On April 26, 2007, Sims and Metal Management executed a mutual confidentiality agreement and agreed to exchange high level financial information.
 
At a Metal Management board of directors meeting on April 27, 2007, Mr. Dienst informed the board of his preliminary discussions with Mr. Sutcliffe concerning a possible business combination and indicated that the companies would exchange financial data to allow them to be able to analyze whether the companies would proceed with further discussions. Mr. Dienst described the possible structure for a business combination and some of the opportunities and risks presented by a possible transaction. The board encouraged Mr. Dienst to continue to investigate a possible transaction.
 
On April 28, 2007, at the direction of Metal Management and Sims, CIBC World Markets, Metal Management’s financial advisor, and UBS AG, Australia Branch and UBS Securities LLC, which are referred to together as UBS, financial advisor to Sims, discussed a possible transaction involving the two companies and what type of financial data Metal Management and Sims could exchange in order to assist in valuation discussions. During the next six weeks, the respective financial advisors of Metal Management and Sims engaged in periodic discussions regarding valuation matters.


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On May 10, 2007, Mr. Sutcliffe informed Mr. Dienst that Mr. Sutcliffe had met with Paul K. Mazoudier, the chairman of the board of Sims, and representatives of UBS to discuss the proposed transaction. Mr. Sutcliffe described the principal issues he believed needed to be discussed with Mr. Dienst when they were to meet in London on May 25, 2007, including relative valuation, respective equity ownership, board composition and management structure.
 
Between May 10 and June 7, 2007, Messrs. Dienst and Sutcliffe continued to communicate about the transaction.
 
On May 22, 2007, the Metal Management board held a meeting. At the meeting, Mr. Dienst updated the board on the discussions with Sims concerning the possible acquisition by Metal Management of Sims’s North American metal recycling operations. Mr. Dienst noted that the transaction structure could be complex and any transaction of this scale was less than certain.
 
On May 25, 2007, Mr. Sutcliffe, Mr. Dienst, Norman R. Bobins, a Metal Management independent director, and Paul J. Varello, an independent Sims director, met in London to discuss the possible transaction between Sims and Metal Management and the terms of a draft term sheet. Messrs. Dienst, Bobins, Sutcliffe and Varello believed they had made substantial progress on financial and governance issues and agreed to continue their discussions, with a view toward reaching agreement on a term sheet by June 14, 2007.
 
On June 7, 2007, Messrs. Sutcliffe and Dienst spoke by telephone about the structure and financial terms of the possible transaction, including a review of the potential cost synergies that could be obtained, but noted the difficulties in achieving a business combination of Metal Management and Sims’s North American operations, including those arising from Sims’s becoming a substantial stockholder in Metal Management as a result of the possible transaction. Mr. Sutcliffe informed Mr. Dienst that the Sims board would discuss the possible transaction at its next scheduled meeting on June 12, 2007.
 
On June 12, 2007, the Sims board of directors held a meeting. The Sims board of directors was then comprised of Mr. Mazoudier, as chairman, Mr. Sutcliffe, Mr. Varello, Geoffrey N. Brunsdon, Ross B. Cunningham, Robert L. Every, J. Michael Feeney, Masakatsu Iwanaga and Christopher J. Renwick. At the meeting, reference was made to a possible transaction involving Metal Management, but it was agreed to defer discussion until a subsequent meeting of the Sims board of directors to be held on June 15, 2007.
 
On June 15, 2007, the Sims board of directors held a meeting at which Mr. Sutcliffe updated the board on discussions with Metal Management concerning a possible transaction, and representatives of UBS reviewed various transaction structural alternatives with the Sims board. The board concluded that a transaction that involved Metal Management acquiring Sims’s North American metal recycling operations was not favored because a partial combination would be likely to involve a complex operational and governance structure and would result in Sims giving up full control over its North American operations. The Sims board determined, however, that a full merger should be explored further.
 
On a telephone call on June 16, 2007, Mr. Sutcliffe informed Mr. Dienst that the Sims board of directors had reviewed the possible transaction involving Metal Management and Sims’s North American assets. Mr. Sutcliffe indicated that the Sims board had concluded that the previously discussed transaction involving only its North American metal recycling operations did not accomplish Sims’s objectives. Mr. Sutcliffe accordingly suggested that a merger of Sims and Metal Management might present better opportunities for the two companies and their respective shareholders, and suggested that Sims and Metal Management consider a merger.
 
On June 18, 2007, Messrs. Dienst and Larry, representatives of CIBC World Markets, representatives of King & Spalding LLP, Metal Management’s legal counsel, Mr. Sutcliffe and representatives of UBS met to discuss Sims’s proposal for a merger, which at that time contemplated that the parent company following the merger would be determined according to the structure that would yield the greatest benefits for both sets of shareholders.
 
On June 19, 2007, Messrs. Dienst and Mazoudier further discussed by telephone a possible merger. On a conference call on June 21, 2007, Mr. Dienst informed the Metal Management board of directors of the Sims proposal for the merger. The Metal Management board of directors agreed that Metal Management should


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engage in appropriate discussion and diligence to determine whether the company should pursue the transaction.
 
On June 22, 2007, Messrs. Dienst and Larry and representatives of King & Spalding and CIBC World Markets had a conference call with Mr. Sutcliffe and representatives of Baker & McKenzie LLP, Sims’s legal counsel, and UBS to discuss the relative financial contributions of the companies and review financial information relating to the companies.
 
On June 22, 2007, Messrs. Dienst and Sutcliffe discussed where the combined company after the merger would maintain its headquarters. They also discussed the diligence process, including environmental due diligence.
 
On June 27, 2007, representatives of King & Spalding, Minter Ellison, Australian legal counsel to Metal Management, and CIBC World Markets had a conference call with representatives of Baker & McKenzie, UBS and Ernst & Young LLP, tax advisor to Sims. During the conference call, tax structuring issues and the financial and tax due diligence process were discussed.
 
On or about July 2, 2007, at the direction of Metal Management and Sims, representatives of CIBC World Markets and UBS had a conference call regarding relative valuation of the companies with respect to the merger. Later that day, Messrs. Dienst and Sutcliffe concluded that the preferred transaction structure would be for Sims to be the surviving parent due to the tax inefficiencies and difficulty of implementation of a transaction involving Metal Management as the parent.
 
On a conference call on July 5, 2007, representatives of King & Spalding, Minter Ellison and CIBC World Markets discussed the possible timing of the merger and the companies’ due diligence process with representatives of Baker & McKenzie and UBS. These discussions also occurred on July 9, 2007.
 
Also on July 9, 2007, Messrs. Sutcliffe and Dienst discussed possible synergies, the possible premium to be reflected in the exchange ratio in connection with the merger and the due diligence process.
 
On July 10, 2007, representatives of Baker & McKenzie, GaiaTech, environmental consultants for Sims, King & Spalding and Metal Management participated in a conference call regarding environmental due diligence. Representatives of CIBC World Markets were also present on the call. Also on July 10, 2007, at the direction of Metal Management and Sims, representatives of CIBC World Markets and UBS discussed the type of financial information that would be necessary to evaluate the merger. Later that day, due to general concerns by both Sims and Metal Management that the due diligence that each party would need to conduct could result in potential leaks concerning the proposed merger, Metal Management and Sims agreed that no substantial due diligence (specifically including site visits) would occur until both companies had reached a general consensus on relative valuation.
 
On July 19, 2007, members of Sims’s Finance & Investment Committee, which is referred to as the F&I Committee, held a meeting. The F&I Committee was then comprised of Messrs. Brunsdon, Cunningham, Every, Renwick, Sutcliffe and Varello. At the meeting, the F&I Committee discussed issues pertaining to a possible merger, including the proposed transaction structure and future regulatory and compliance obligations, potential synergies, the headquarters and management of the combined company resulting from a merger, due diligence requirements and valuation considerations. Following the meeting, Mr. Sutcliffe sent Mr. Dienst correspondence updating him on discussions of the F&I Committee and raising the possibility of Sims delivering a letter and term sheet to Metal Management summarizing the terms of a possible merger.
 
On July 23, 2007, members of the F&I Committee held a meeting at which they further discussed issues pertaining to a possible merger, in particular concerning the composition and structure of the board of directors of the combined company resulting from a possible merger. Mr. Sutcliffe updated Mr. Dienst again on July 23, 2007 regarding the discussions by the F&I Committee.
 
On July 26, 2007, members of the F&I Committee held a meeting at which they and representatives of UBS discussed key transaction issues and valuation considerations. The F&I Committee resolved to recommend to the Sims board of directors proceeding with a possible merger on the basis of a maximum


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premium of 12.5% to 15% to the one-week volume weighted average price of Metal Management’s shares and a maximum exchange ratio of 2.10 to 2.15.
 
Mr. Sutcliffe updated Mr. Dienst again on July 26, 2007 on discussions by members of the Sims board of directors. On July 26, 2007, Mr. Dienst updated Mr. Sutcliffe on discussions by the Metal Management board of directors.
 
On July 27, 2007, the Sims board of directors met to consider the terms of a draft letter and term sheet describing a non-binding proposal with respect to a possible merger. Following a discussion regarding the letter and term sheet, the Sims board of directors authorized Mr. Mazoudier to send the letter and term sheet on behalf of Sims to Mr. Dienst and the Metal Management board of directors.
 
Also on July 27, 2007, Mr. Dienst and the Metal Management board of directors received the letter and term sheet sent by Mr. Mazoudier. The Sims letter and term sheet proposed that the exchange ratio be calculated at a maximum implied premium of 12.5% to Metal Management’s share price (based upon an average of the five-day volume weighted prices and an average daily currency exchange rate prior to execution of a merger agreement), and a maximum exchange ratio of 2.10 Sims ADSs for each outstanding share of Metal Management common stock. The term sheet also had proposals regarding the location of executive headquarters (New York) and infrastructure (Chicago), senior management (with Mr. Dienst as chief executive officer, Mr. Larry as chief financial officer, Mr. Sutcliffe and Ross B. Cunningham, Sims’s chief financial officer, continuing as executive directors and a designee of Sims as chairman of the board), board composition (substantially as included in the merger agreement, except that the initial proposal was for four non-executive directors to be nominated by Sims) and deal protection provisions (referring generally to mutual “fiduciary outs” with customary termination fees).
 
At a Metal Management board meeting on July 29, 2007, Mr. Dienst updated the board on the negotiations with Sims’s management regarding the proposed merger. Representatives of King & Spalding discussed with the Metal Management board aspects of the proposal and term sheet, including a discussion of director fiduciary duties, and CIBC World Markets discussed with the Metal Management board financial aspects of the proposal. Mr. Dienst also discussed the strategic rationale for the transaction, including the following factors: the global nature of the combined entity; the expansion of Metal Management’s existing North American operations; the potential synergies that would result from the proposed merger; the geographic and segment diversification of the combined company’s operations; the balance between domestic and export markets; the potential to further capitalize on Sims’s strong global trading operations; the retention of qualified managers at the corporate and regional levels; and a global platform for future growth. The Metal Management board instructed Mr. Dienst to prepare and send to Sims a letter with Metal Management’s counter-proposal.
 
On July 30, 2007, Mr. Dienst and Gerald E. Morris, lead independent director of Metal Management, sent a letter to Mr. Mazoudier and the Sims board of directors with the Metal Management counter proposal to the Sims July 27, 2007 non-binding proposal. The Metal Management letter proposed that the exchange ratio be calculated using a minimum exchange ratio of 2.10 Sims ADSs for each outstanding share of Metal Management common stock and a maximum implied premium of 17.5% to Metal Management’s share price. The letter also suggested that the companies continue to try to reach an understanding on financial terms, board composition and other matters with respect to the proposed merger.
 
On July 31, 2007, Messrs. Dienst and Sutcliffe discussed the details of the proposed merger and each company’s position in the negotiations. At the direction of Metal Management and Sims, Metal Management’s and Sims’s respective financial advisors also had discussions on July 31, 2007 about, among other matters, the financial terms of the proposed transaction, including the possible exchange ratio and implied premium to Metal Management’s share price.
 
On or about August 1, 2007, representatives of UBS and CIBC World Markets participated in a conference call to discuss Metal Management’s latest proposal sent on July 30, 2007, in which representatives of UBS indicated that Sims was willing to calculate the exchange ratio using a maximum exchange ratio of 2.10 Sims ADSs for each outstanding share of Metal Management common stock, subject to a maximum


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implied premium of 15% to Metal Management’s share price (based on the five-day volume weighted average trading prices at the time a merger agreement would be signed).
 
On August 2, 2007, the Metal Management board of directors held a telephonic meeting. During the board meeting, Mr. Dienst again updated the Metal Management board on the negotiations for the proposed merger. CIBC World Markets discussed with the board financial terms of the latest Sims proposal, including the exchange ratio, premium and implied pro forma ownership of the combined company. The board also discussed the potential strategic rationale for the merger, including the potential creation of shareholder value to Metal Management stockholders and whether to initiate due diligence with the ability to negotiate the terms of the deal after substantially completing due diligence or whether to negotiate the terms of the proposed merger before initiating the due diligence process. The Metal Management board of directors then discussed the parameters for a counter-proposal to Sims’s current proposal. While the Metal Management board acknowledged that no consensus with Sims had been reached regarding the appropriate relative valuation for the two companies, the Metal Management board’s view was that the Sims and Metal Management positions were reasonably close. The Metal Management board of directors then instructed Mr. Dienst to expand the due diligence efforts to determine if a transaction was feasible and to allow final valuation discussions to occur following the completion of due diligence.
 
On or around August 3, 2007, Mr. Sutcliffe sent an email to Mr. Dienst indicating that Sims would be prepared to proceed with discussions on the basis of an exchange ratio of approximately 2.15 or a premium of approximately 15%.
 
Between August 3, 2007 and September 23, 2007, Messrs. Dienst and Sutcliffe updated each other concerning the due diligence process and the positions of each company regarding the proposed merger.
 
During August 7 through August 10, 2007, Mr. Dienst and Alan D. Ratner, President of Metal Management Northeast, Inc., toured Sims’s facilities in Europe with members of Sims’s management.
 
On or about August 14, 2007, Metal Management and Sims agreed on a mutual due diligence request list, began to exchange documents and financial and other information and commenced more in-depth due diligence efforts. Due diligence, including site visits by environmental consultants, commenced promptly thereafter, and continued through to September 24, 2007.
 
On August 17, 2007, representatives of Baker & McKenzie sent representatives of King & Spalding an initial draft of a merger agreement for the proposed merger. From August 17, 2007 until September 24, 2007, representatives of King & Spalding and Baker & McKenzie negotiated the terms of the draft merger agreement.
 
During August 15 through August 18, 2007, Messrs. Dienst, Ratner and Larry toured Sims’s facilities in Australia with members of Sims’s management.
 
During August 19, 2007 through August 23, 2007, Mr. Sutcliffe toured Metal Management’s facilities in the United States with members of Metal Management’s senior management.
 
On August 29, 2007, Mr. Sutcliffe communicated with Mr. Dienst regarding the proposed dividend policy of the combined company after the proposed merger and a suggested timeline for the reelection and retirement of certain members of the board of directors of the combined company after the merger, which proposals were subsequently agreed on by both boards of directors.
 
On August 30, 2007, members of the F&I Committee held a meeting at which they discussed the progress of due diligence, listing and filing matters, financial parameters and other outstanding issues relating to the merger. Also on August 30, 2007, at the direction of Metal Management and Sims, their respective financial advisors further discussed, among other things, valuation matters.
 
On August 31, 2007, the Sims board of directors held a meeting. At the meeting, the board discussed and approved wording for the dividend policy of the combined company following the proposed merger. The board authorized Mr. Sutcliffe to convey the approved dividend policy to the Metal Management board of directors.


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At meetings of the Metal Management board of directors on September 5 and September 6, 2007, Mr. Dienst and Mr. Larry provided updates on the due diligence process, representatives of King & Spalding led discussions of the directors’ fiduciary duties in the context of considering the proposed merger, summarized the key terms of the draft merger agreement, including the termination and termination fee provisions and also updated the board on diligence matters, and CIBC World Markets updated the board on financial aspects of the proposed merger. The board again discussed the strategic rationale for the merger, including the similarity of the assets of Sims and Metal Management, the potential synergies to be derived from the merger and the global footprint that the combined company would create. On September 6, some members of the board of directors of Sims and Metal Management met and discussed the proposed merger. The following day, those members toured several of Metal Management’s operating sites.
 
On or about September 5, 2007, Mr. Mazoudier informed Mr. Morris that Sims was close to reaching its aggregate cap for non-executive directors’ compensation and that Sims would need to seek shareholder approval to increase the cap at the next shareholders’ meeting to accommodate a larger board after the merger.
 
On September 9, 2007, a representative of Baker & McKenzie distributed a revised draft of the merger agreement to representatives of King & Spalding.
 
On September 12, 2007, Mr. Mazoudier sent Mr. Morris an email setting out the basis for non-executive directors’ fees, which are determined through a comparison of the fees of ASX companies with similar market capitalizations, and outlined Sims’s non-executive directors’ compensation structure, which does not include the grant of shares or options to non-executive directors. Mr. Mazoudier noted that Metal Management directors would be entitled to a higher cash base salary as non-executive directors of Sims Metal Management but that the loss of option grants could result in lower compensation overall.
 
On September 13, 2007. Mr. Mazoudier corresponded with Mr. Morris regarding whether there should be an increase in Mr. Dienst’s salary after the merger and the expectation of future share grants to Mr. Dienst, and noted issues regarding required shareholder approval of any future share grants.
 
On September 14, 2007, Mr. Morris updated the remaining members of the Metal Management board of directors about his discussions with Mr. Mazoudier.
 
On September 17, 2007, Mr. Mazoudier discussed separately with Messrs. Feeney and Varello, the members of the Sims Remuneration Committee, Mr. Dienst’s proposed compensation package, including short-term and long-term incentive plans, compensation package review, the vesting of the restricted stock grant and a sign-on bonus.
 
On September 18, 2007, Mr. Mazoudier sent Mr. Dienst an email proposing a continuation of Mr. Dienst’s current salary through June 30, 2009 (which would then be subject to review). The proposal also contemplated that Mr. Dienst would become eligible to participate in Sims’s short-term and long-term incentive plans for the year ending June 30, 2009 in lieu of the current Metal Management bonus plan and historical stock grant policy and would be entitled to receive a $1 million integration bonus upon achievement of synergies to be specified. The proposal also contemplated that Mr. Dienst’s existing restricted stock would vest upon closing of the merger but that he would agree to pay a cash clawback amount if he were not to continue to serve as the Sims Metal Management chief executive officer through July 26, 2010, with a lesser clawback amount if he were to leave before July 26, 2011 or July 26, 2012.
 
On September 18, 2007, the Metal Management board of directors (without Mr. Dienst participating) discussed Sims’s proposal regarding Mr. Dienst’s possible compensation as chief executive officer of the combined company after consummation of the merger, including whether it would be appropriate to accelerate vesting of his restricted stock that did not already automatically vest upon consummation of the merger. The board also determined that any discretionary restricted stock award to Mr. Dienst in respect of Metal Management’s fiscal 2008 performance would be increased by an amount of restricted stock with a value of $1 million in recognition of his extraordinary efforts with respect to the merger (but in no event to exceed a total grant of 75,000 shares). The board also agreed to modify its short-term bonus program upon completion of the merger to make the 2008 payments after completion of the audit of Sims Metal Management’s 2008 financial statements, but the bonus payments would be calculated as of March 31, 2008 at 125% of the amount


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that the eligible employee would have received had such payment been made after completion of Metal Management’s 2008 financial statements, reflecting a 15 month period, except that, in respect of Messrs. Dienst and Larry, they would receive, prior to closing of the merger, the maximum percentage payable to them under the RONA Plan, plus an additional three months of annualized bonus compensation at the same percentage. The board also determined that it would create a potential discretionary bonus pool (for which Mr. Dienst would not be eligible) to compensate certain employees for their extraordinary efforts with respect to the merger.
 
On September 21, 2007, members of the F&I Committee held a meeting at which they discussed at length a draft merger proposal and resolved to recommend the proposal to the Sims board of directors for further consideration. Following the meeting of the F&I Committee, the Sims board of directors held a meeting at which the board discussed various outstanding issues pertaining to the merger. Representatives of UBS discussed valuation issues, the financial impact of the proposed merger on Sims and key market considerations regarding the proposed merger. Representatives of Baker & McKenzie discussed the progress of the legal and environmental due diligence process and provided a summary of the key terms of the draft merger agreement. The board agreed to instruct representatives of UBS to continue discussions with CIBC World Markets regarding the exchange ratio. Based on these instructions, an exchange ratio was proposed to Metal Management, of 2.00 Sims ADSs for each outstanding share of Metal Management common stock, which, due to significant movements in the Australian dollar — U.S. dollar exchange rate and the relative prices of Sims and Metal Management shares since July 2007, reflected at that time an implied premium of approximately 15% to Metal Management’s share price.
 
On September 21, 2007, Mr. Sutcliffe conveyed to Mr. Dienst the position of Sims’s board of directors that Mr. Dienst’s unvested shares must vest upon the closing of the merger and that any integration bonus would be payable in August 2009 upon completion of the combined company’s audit. Mr. Sutcliffe also conveyed the approval of the compensation terms outlined by Mr. Mazoudier regarding non-executive directors.
 
On the morning of September 23, 2007, the Metal Management board of directors held a meeting. At that meeting, representatives of King & Spalding provided an update on the merger agreement and again reviewed with the directors their fiduciary duties. CIBC World Markets provided an update on financial terms of the proposed merger. The Metal Management board of directors authorized Mr. Dienst and CIBC World Markets to propose an exchange ratio of 2.10 and indicated that the minimum exchange ratio that would be acceptable to the Metal Management board of directors was 2.05 Sims ADSs for each outstanding share of Metal Management common stock with a minimum pro forma equity ownership of 30% for Metal Management stockholders. After the Metal Management board meeting, and as instructed by the Metal Management board of directors, CIBC World Markets proposed on behalf of Metal Management to UBS an exchange ratio of 2.10 Sims ADSs for each outstanding share of Metal Management common stock. UBS representatives responded that a middle ground exchange ratio of between 2.00 and 2.10 might be acceptable to the Sims board of directors.
 
In the afternoon of September 23, 2007, the Metal Management board of directors met again. CIBC World Markets updated the board on its discussions with UBS. The Metal Management board of directors instructed CIBC World Markets to resume discussions regarding the exchange ratio.
 
Later that day, representatives of Metal Management’s financial advisor attempted to resume discussions with representatives of UBS in accordance with the directives of the Metal Management board of directors and were informed by UBS that the Sims board of directors would be meeting the next day to consider authorizing a 2.05 exchange ratio.
 
On September 23, 2007, Sims, through Mr. Sutcliffe, sent Messrs. Dienst and Larry letters that would revise their respective current employment agreements if the proposed merger was consummated.
 
On September 23 and September 24, 2007, representatives of King & Spalding and Baker & McKenzie finalized the terms of the merger agreement, subject to approval by the boards of directors of Sims and Metal Management.


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On September 24, 2007, the Sims board of directors held a meeting. At the meeting, representatives of UBS provided the board with an update on the financial terms of the proposed merger and representatives of Baker & McKenzie reviewed with the board the terms of the proposed merger agreement. Following discussion and the consideration of a range of strategic and financial matters and risks and potential benefits, including the risks and potential benefits discussed under “— Sims’s Reasons for the Merger,” the Sims board of directors unanimously approved the merger based on an exchange ratio of 2.05 Sims ADSs for each outstanding share of Metal Management common stock and authorized the management of Sims to finalize and execute the merger agreement based on the terms presented to the board.
 
On the morning of September 24, 2007, the Metal Management board of directors held a telephonic meeting. Mr. Dienst updated the board of directors on negotiations with Sims and informed the board that the Sims board of directors approved the merger at an exchange ratio of 2.05. Representatives of King & Spalding reviewed the terms of the merger agreement. Also at this meeting, CIBC World Markets reviewed with the Metal Management board of directors its financial analysis of the exchange ratio and rendered to the Metal Management board of directors an oral opinion, which was confirmed by delivery of a written opinion, dated September 24, 2007, as to the fairness, from a financial point of view, of the exchange ratio provided for in the merger. The Metal Management board of directors unanimously approved the merger agreement.
 
Metal Management’s Reasons for the Merger and Recommendation of its Board of Directors
 
By unanimous vote, the Metal Management board of directors, at a meeting held on September 24, 2007, determined that the merger agreement and the transactions contemplated by the merger agreement were advisable and in the best interests of the Metal Management stockholders and approved the merger agreement and the transactions contemplated thereby, including the merger. The Metal Management board of directors unanimously recommends that the Metal Management stockholders vote “FOR” adoption of the merger agreement and the transactions contemplated by the merger agreement at the Metal Management special meeting.
 
In evaluating the merger, the Metal Management board of directors consulted with Metal Management’s management and legal and financial advisors and considered a variety of factors, including the material factors described below. In light of the number and wide variety of factors considered in connection with its evaluation of the transaction, the Metal Management board of directors did not consider it practicable to, and did not attempt to, quantify or otherwise assign relative weights to the specific factors that it considered in reaching its determination. The Metal Management board of directors viewed its position as being based on all of the information available and the factors presented to and considered by it. In addition, individual directors may have given different weights to different factors. This explanation of Metal Management’s reasons for the proposed merger and all other information presented in this section is forward-looking in nature and, therefore, should be read in light of the facts discussed under “Cautionary Statements Regarding Forward-Looking Information.”
 
Strategic Considerations
 
The Metal Management board of directors considered a number of factors pertaining to the strategic rationale for the merger as generally supporting its decision to enter into the merger agreement, including the following:
 
  •  its view of the anticipated strategic fit between Metal Management and Sims, which the Metal Management board of directors believes will provide the combined company with significantly greater capabilities and financial resources enhancing competitiveness to a degree that neither company has, or could develop, on its own;
 
  •  its expectation that the combined company would be a leading global recycler with:
 
  •  operations on four continents and in over 200 locations;
 
  •  the ability to serve global ferrous and non-ferrous consumers; and


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  •  a significant expansion in the North American market, with Metal Management’s strong domestic presence complementing Sims’s export-focused North American business;
 
  •  its view that the combined company would have a broad product diversification, including recycling solutions and other industrial segments, and be able to capitalize on Sims’s strong global trading operations; and
 
  •  its view that a global platform provides the best opportunity for future growth.
 
Financial Considerations
 
The Metal Management board of directors also considered a number of financial factors pertaining to the merger as generally supporting its decision to enter into the merger agreement, including the following:
 
  •  based upon the advice of Metal Management management who engaged in an analysis with Sims management, the significant synergies that could result from the transaction, including:
 
  •  approximately $35 million of tangible operating synergies, including approximately $9 million of plant and staffing consolidation benefits, $22 million of selling, transportation and logistics and handling benefits and $4 million of joint purchasing of non-scrap consumables and reduced waste removal and handling costs; and
 
  •  the mutual identification of additional sources of synergies by Metal Management’s and Sims’s management team;
 
  •  the financial terms of the transaction, including:
 
  •  the fixed exchange ratio of 2.05 Sims ADSs for each share of Metal Management common stock, representing a premium of approximately 18.2% based on the closing price of Metal Management’s common stock on September 21, 2007, the last trading day immediately preceding the announcement of the entry into the merger agreement by Sims, Metal Management and MMI Acquisition Corporation, which resulted in a valuation that exceeded the 52-week high intra-day trading price of Metal Management common stock by more than 10%;
 
  •  because the exchange ratio for the stock is fixed, the opportunity for Metal Management stockholders to benefit from any increase in the trading price of Sims ordinary shares or in the appreciation of the Australian dollar between the announcement of the merger and the closing of the merger;
 
  •  the earnings, cash flow and balance sheet impact of the proposed combined company relative to the historical financial performance of Metal Management and the historical trading price of its common stock, which the board believed would result in the potential enhancement of Metal Management stockholder value; and
 
  •  the expectation that Metal Management stockholders will hold ADSs representing approximately 30% of the outstanding ordinary shares of the combined company immediately after closing and will have the opportunity to share in the future growth and expected synergies of the combined company while retaining the flexibility of selling all or a portion of those shares for cash at any time;
 
  •  the opinion, and financial presentation, dated September 24, 2007, of CIBC World Markets to the Metal Management board of directors as to the fairness, from a financial point of view and as of the date of the opinion, of the exchange ratio provided for in the merger, as more fully described below under the sub-section entitled “Opinion of Metal Management’s Financial Advisor;” and
 
  •  the expectation that the merger would qualify as a reorganization for United States federal income tax purposes and that, as a result, the exchange by Metal Management stockholders of their shares of Metal Management common stock for Sims ADSs in the merger generally would be tax-free to Metal Management stockholders.


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Other Considerations with Respect to the Merger
 
The Metal Management board of directors also considered a number of additional factors as generally supporting its decision to enter into the merger agreement, including the following:
 
  •  its view that based upon information then available, it was unlikely that there would be available an alternative transaction, if one were to be pursued, that would provide greater value to the Metal Management stockholders than the merger with Sims;
 
  •  the ability under the merger agreement of Metal Management under certain limited circumstances to provide non-public information to, and engage in discussions with, third parties that proposed an alternative transaction;
 
  •  its view that the terms of the merger agreement, including the termination fee, would not preclude a proposal for an alternative transaction involving Metal Management;
 
  •  its view that, as a percentage of the merger consideration at the time of the announcement of the transaction, the termination fee was at or below the range of termination fees provided for in recent comparable acquisition transactions;
 
  •  the mutuality of the representations, warranties and covenants of the merger agreement, including the ability of Metal Management to receive a termination fee if Sims terminated the merger agreement under certain circumstances;
 
  •  the proposed management arrangements of the combined company under which:
 
  •  the chief executive officer and the chief financial officer of Metal Management would be the chief executive officer and chief financial officer of the combined company; and
 
  •  the board of directors of the combined company would be comprised of 12 directors, including (i) five directors to be nominated by Sims (including the chairman, the current chief executive officer and chief financial officer of Sims), (ii) five directors nominated by Metal Management (including the chief executive officer of Metal Management) and (iii) two directors to be nominated by Mitsui;
 
  •  the executive offices of the combined company would be located in New York and the operational headquarters would be located in Chicago, Illinois; and
 
  •  the prospects for the merger receiving necessary regulatory approvals and the anticipated timing and conditions of those approvals.
 
Risks
 
The Metal Management board of directors also identified and considered a number of uncertainties, risks and other potentially negative factors, including the following:
 
  •  the Metal Management stockholders would receive ADSs issued by a foreign company instead of common stock of a domestic company;
 
  •  the difficulties and challenges inherent in and increased costs attributable to completing the merger and integrating the businesses, especially since the businesses currently reside in different national jurisdictions;
 
  •  the challenges implicit in and expenses attributable to subjecting the Sims business to the internal control reporting and certifications required under the Exchange Act;
 
  •  the risk that the expected synergies and other benefits of the merger might not be fully achieved or may not be achieved within the timeframes expected;
 
  •  given the size of the combined company and the mix of assets it will own, the challenges that it will face in continuing to grow its revenues profitably;
 
  •  the risks of the type and nature described under “Risk Factors;”


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  •  the possibility that regulatory or governmental authorities might seek to impose conditions on or otherwise prevent or delay the merger (and that the merger ultimately may not be completed as a result of material adverse conditions imposed by regulatory authorities or otherwise);
 
  •  certain provisions of the merger agreement may have the effect of discouraging proposals for alternative transactions with Metal Management, including:
 
  •  the requirement that Metal Management provide Sims the right to obtain information with respect to proposals for alternative transactions;
 
  •  the requirement that the Metal Management board of directors provide Sims with the right to offer to modify the merger agreement to match the terms of any superior proposal for an alternative transaction; and
 
  •  the requirement that Metal Management pay a termination fee of $25 million to Sims in certain circumstances following the termination of the merger agreement, including if Sims terminates the merger agreement as a result of the Metal Management board of directors’ withdrawal of its recommendation for the merger or its recommendation of an alternative transaction or the Metal Management stockholders failing to approve the merger in light of a publicly announced alternative transaction and Metal Management enters into an alternative transaction within 12 months (see “The Merger Agreement - Termination Fee and Expense Reimbursement”);
 
  •  certain of Metal Management’s directors and officers have interests in the merger as individuals that are in addition to, or that conflict with, the interests of the Metal Management stockholders (see “The Merger — Interests of Directors and Executive Officers in the Merger”);
 
  •  the fees and expenses associated with completing the merger;
 
  •  the risk that certain members of Metal Management senior management or Sims senior management might choose not to remain employed with the combined company;
 
  •  the risk that the Metal Management stockholders may fail to approve the merger;
 
  •  the risk that a significant number of Metal Management stockholders may cease to hold stock in the combined company because the combined company might be a foreign private issuer or a company that is not incorporated in the United States;
 
  •  the risk and costs that the merger might not be completed, the potential impact of the restrictions under the merger agreement or Metal Management’s ability to take certain actions during the period prior to the closing of the merger agreement (which may delay or prevent Metal Management from undertaking business opportunities that may arise pending completion of the merger), the potential for diversion of management and employee attention and for increased employee attrition during that period and the potential effect of these on Metal Management’s business and relations with customers and service providers;
 
  •  the disparities in compensation levels, compensation systems and philosophy between Sims and Metal Management and, more generally, Australian and United States-based companies, could pose cultural and management challenges for the combined company. The disparities include the following:
 
  •  with respect to employee’s total compensation, the component that is comprised of base salary is a higher percentage of total compensation for Sims employees than Metal Management employees;
 
  •  Metal Management’s equity based awards are distributed more widely throughout the company than Sims’s equity based awards;
 
  •  while both the Metal Management and Sims long-term incentive compensation programs are performance based, Metal Management exercises more flexibility in determining the amount of awards to specific employees based on his or her individual performance; and


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  •  awards of equity to directors of Australian companies listed on the ASX generally must be approved by shareholders and the payment of fees to non-executive directors of such companies is generally exclusively in cash;
 
  •  because the exchange ratio for the stock is fixed, Metal Management stockholders will potentially be adversely affected by any decrease in the sale price of Sims ordinary shares between the date of execution of the merger agreement and the closing of the merger, which would not have been the case had the consideration been based on a fixed value (a fixed dollar amount of value per share in all cases); and
 
  •  the effect that fluctuations in the U.S. dollar — Australian dollar exchange rate may have on the relative value of the merger consideration to be received by the Metal Management stockholders.
 
The Metal Management board of directors weighed the potential benefits, advantages and opportunities of a merger and the risk of not pursuing a transaction with Sims against the risks and challenges inherent in the proposed merger. The Metal Management board of directors realized that there can be no assurance about future results, including results expected or considered in the factors listed above. However, the Metal Management board of directors concluded that the potential benefits outweighed the risks for consummating the merger with Sims.
 
After taking into account these and other factors, the Metal Management board of directors unanimously determined that the merger agreement and the transactions contemplated by the merger agreement were advisable and in the best interests of the Metal Management stockholders, approved the merger with Sims and the other transactions contemplated by the merger agreement, and approved the merger agreement.
 
Opinion of Metal Management’s Financial Advisor
 
Metal Management has engaged CIBC World Markets as its financial advisor in connection with the merger. In connection with this engagement, the Metal Management board of directors requested that CIBC World Markets evaluate the fairness, from a financial point of view, to the holders of Metal Management common stock of the exchange ratio provided for in the merger. On September 24, 2007, at a meeting of the Metal Management board of directors held to evaluate the merger, CIBC World Markets rendered to the Metal Management board of directors an oral opinion, which was confirmed by delivery of a written opinion, dated September 24, 2007, to the effect that, as of that date and based on and subject to the matters described in its opinion, the exchange ratio was fair, from a financial point of view, to the holders of Metal Management common stock.
 
The full text of CIBC World Markets’ written opinion, dated September 24, 2007, which describes the assumptions made, procedures followed, matters considered and limitations on the review undertaken, is attached to this proxy statement/prospectus as Appendix B. CIBC World Markets’ opinion was provided to the Metal Management board of directors in connection with its evaluation of the exchange ratio from a financial point of view. CIBC World Markets’ opinion does not address any other aspect of the merger and does not constitute a recommendation to any stockholder as to how such stockholder should vote or act with respect to any matters relating to the merger. The summary of CIBC World Markets’ opinion described below is qualified in its entirety by reference to the full text of its opinion. Holders of Metal Management common stock are encouraged to read the opinion carefully in its entirety.
 
In arriving at its opinion, CIBC World Markets:
 
  •  reviewed the merger agreement;
 
  •  reviewed publicly available audited financial statements of Metal Management for fiscal years ended March 31, 2005, March 31, 2006 and March 31, 2007 and unaudited financial statements of Metal Management prepared by the management of Metal Management for the three months ended June 30, 2007, and also reviewed publicly available audited financial statements of Sims for fiscal years ended June 30, 2005, June 30, 2006 and June 30, 2007;


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  •  reviewed other historical financial data, as adjusted to reflect certain acquisitions and other items, of Metal Management and Sims provided to CIBC World Markets by the respective managements of Metal Management and Sims;
 
  •  reviewed financial forecasts and estimates relating to Metal Management for the fiscal year ending March 31, 2008 prepared by the management of Metal Management as well as estimates as to the potential cost savings anticipated by the managements of Metal Management and Sims to result from the merger;
 
  •  held discussions with the senior managements of Metal Management and Sims with respect to the businesses and prospects of Metal Management and Sims;
 
  •  reviewed historical market prices and trading volumes for Metal Management common stock and Sims ordinary shares;
 
  •  reviewed and analyzed certain publicly available financial data for companies that CIBC World Markets deemed relevant in evaluating Metal Management and Sims;
 
  •  reviewed and analyzed certain publicly available information for transactions that CIBC World Markets deemed relevant in evaluating the merger;
 
  •  reviewed and analyzed the premiums paid, based on publicly available financial information, in merger and acquisition transactions CIBC World Markets deemed relevant in evaluating the merger;
 
  •  reviewed the relative contributions of Metal Management and Sims to selected operational metrics of the combined company based on historical financial data of Metal Management and Sims;
 
  •  reviewed the potential pro forma financial effect of the merger on Sims’s earnings per share based on historical financial data of Metal Management and Sims and estimates as to the potential cost savings anticipated to result from the merger prepared by the managements of Metal Management and Sims;
 
  •  reviewed other public information concerning Metal Management and Sims; and
 
  •  performed such other analyses, reviewed such other information and considered such other factors as CIBC World Markets deemed appropriate.
 
In rendering its opinion, CIBC World Markets relied upon and assumed, without independent verification or investigation, the accuracy and completeness of all of the financial and other information provided to or discussed with CIBC World Markets by Metal Management and Sims and their respective employees, representatives and affiliates or otherwise reviewed by CIBC World Markets. CIBC World Markets was not provided with any financial forecasts and estimates relating to Sims prepared by Sims’s management and, accordingly, CIBC World Markets did not undertake an analysis of the financial performance of Sims beyond June 30, 2007. In addition, CIBC World Markets was advised that financial forecasts and estimates relating to Metal Management for periods beyond March 31, 2008 were not prepared by the management of Metal Management and, accordingly, CIBC World Markets did not undertake an analysis of Metal Management’s financial performance beyond March 31, 2008. With respect to the financial forecasts and estimates provided to CIBC World Markets relating to Metal Management, CIBC World Markets assumed, at the direction of the management of Metal Management and with Metal Management’s consent, without independent verification or investigation, that such forecasts and estimates were reasonably prepared on bases reflecting the best available information, estimates and judgments of the management of Metal Management as to Metal Management’s future financial condition and operating results. With respect to adjusted historical financial data relating to Metal Management and Sims provided to CIBC World Markets by the respective managements of Metal Management and Sims and estimates as to the potential cost savings anticipated by the managements of Metal Management and Sims to result from the merger, CIBC World Markets assumed, at the direction of the respective managements of Metal Management and Sims and with Metal Management’s consent, without independent verification or investigation, that such data and estimates were reasonably prepared on bases reflecting the best available information, estimates and judgments of the managements of Metal Management and Sims as to the matters covered by such data and estimates. CIBC World Markets assumed, with Metal


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Management’s consent, that the financial results reflected in such forecasts and estimates, including estimates as to the potential cost savings and synergies anticipated to result from the merger, would be achieved at the times and in the amounts projected. CIBC World Markets relied, without independent verification, upon the assessments of the management of Metal Management as to market trends and prospects for the metal recycling industry and the potential impact of such trends and prospects on Metal Management and Sims. CIBC World Markets also relied, at Metal Management’s direction, without independent verification or investigation, on the assessments of the management of Metal Management as to the ability to integrate the businesses of Metal Management and Sims and to retain key customers of Metal Management and Sims.
 
CIBC World Markets assumed, with Metal Management’s consent, that the merger would qualify for federal income tax purposes as a reorganization under Section 368(a) of the Code. CIBC World Markets also assumed, with Metal Management’s consent, that the merger would be consummated in accordance with its terms without waiver, modification or amendment of any material term, condition or agreement and in compliance with all applicable laws and other requirements and that, in the course of obtaining the necessary regulatory or third party approvals and consents with respect to the merger, no delay, limitation, restriction or condition would be imposed that would have an adverse effect on Metal Management, Sims or the merger, including the contemplated benefits of the merger. CIBC World Markets neither made nor obtained any independent evaluations or appraisals of the assets or liabilities, contingent or otherwise, of Metal Management or Sims. CIBC World Markets’ opinion related to the relative values of Metal Management and Sims. CIBC World Markets did not express any opinion as to the underlying valuation, future performance or long-term viability of Metal Management or Sims, or the prices at which Metal Management common stock, Sims ordinary shares or Sims ADSs would trade at any time. CIBC World Markets expressed no view as to, and its opinion did not address, any terms or other aspects of the merger (other than the exchange ratio to the extent expressly specified in its opinion) or any aspect or implication of any other agreement, arrangement or understanding entered into in connection with the merger or otherwise. In addition, CIBC World Markets expressed no view as to, and its opinion did not address, Metal Management’s underlying business decision to proceed with or effect the merger nor did its opinion address the relative merits of the merger as compared to any alternative business strategies that might exist for Metal Management or the effect of any other transaction in which Metal Management might engage. In connection with its engagement, CIBC World Markets was not requested to, and it did not, solicit third party indications of interest in the possible acquisition of all or a part of Metal Management. CIBC World Markets’ opinion was necessarily based on the information available to it and general economic, financial and stock market conditions and circumstances as they existed and could be evaluated by CIBC World Markets on the date of its opinion. It should be understood that, although subsequent developments may affect CIBC World Markets’ opinion, CIBC World Markets does not have any obligation to update, revise or reaffirm its opinion. Except as described above, Metal Management imposed no other instructions or limitations on CIBC World Markets with respect to the investigations made or the procedures followed by it in rendering its opinion.
 
This summary is not a complete description of CIBC World Markets’ opinion or the financial analyses performed and factors considered by CIBC World Markets in connection with its opinion. The preparation of a financial opinion is a complex analytical process involving various determinations as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances and, therefore, a financial opinion is not readily susceptible to summary description. CIBC World Markets arrived at its ultimate opinion based on the results of all analyses undertaken by it and assessed as a whole, and did not draw, in isolation, conclusions from or with regard to any one factor or method of analysis for purposes of its opinion. Accordingly, CIBC World Markets believes that its analyses and this summary must be considered as a whole and that selecting portions of its analyses and factors or focusing on information presented in tabular format, without considering all analyses and factors or the narrative description of the analyses, could create a misleading or incomplete view of the processes underlying CIBC World Markets’ analyses and opinion.
 
In performing its analyses, CIBC World Markets considered industry performance, general business, economic, market and financial conditions and other matters existing as of the date of its opinion, many of which are beyond the control of Metal Management and Sims. No company, business or transaction used in


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the analyses is identical or directly comparable to Metal Management, Sims or the merger, and an evaluation of the results of those analyses is not entirely mathematical. Rather, the analyses involve complex considerations and judgments concerning financial and operating characteristics and other factors that could affect the acquisition, public trading or other values of the companies, business segments or transactions analyzed.
 
The forecasts and estimates contained in CIBC World Markets’ analyses and the ranges of valuations resulting from any particular analysis are not necessarily indicative of actual values or future results, which may be significantly more or less favorable than those suggested by its analyses. In addition, analyses relating to the value of businesses or securities do not purport to be appraisals or to reflect the prices at which businesses or securities actually may be sold. Accordingly, the forecasts and estimates used in, and the results derived from, CIBC World Markets’ analyses are inherently subject to substantial uncertainty.
 
The type and amount of consideration payable in the merger were determined through negotiation between Metal Management and Sims, and the decision to enter into the merger was solely that of the Metal Management board of directors. CIBC World Markets’ opinion and financial presentation were only one of many factors considered by the Metal Management board of directors in its evaluation of the merger and should not be viewed as determinative of the views of the Metal Management board of directors or management with respect to the merger or the exchange ratio provided for in the merger.
 
The following is a summary of the material financial analyses reviewed with the Metal Management board of directors in connection with CIBC World Markets’ opinion dated September 24, 2007. The financial analyses summarized below include information presented in tabular format. In order to fully understand CIBC World Markets’ financial analyses, the tables must be read together with the text of each summary. The tables alone do not constitute a complete description of the financial analyses. Considering the data in the tables below without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of CIBC World Markets’ financial analyses.
 
Selected Companies Analysis
 
CIBC World Markets performed separate selected companies’ analyses of Metal Management and Sims in which CIBC World Markets reviewed financial and stock market information of selected publicly held companies in the metal recycling industry. Financial data of the selected companies were based on public filings, publicly available research analysts’ estimates and other publicly available information. Estimated financial data of Metal Management were based on internal estimates of the management of Metal Management and historical financial data of Metal Management and Sims were provided by the respective managements of Metal Management and Sims. Latest 12 months financial data of Metal Management, Sims and the selected companies were for the 12-month period ended June 30, 2007.
 
Metal Management.  CIBC World Markets reviewed financial and stock market information of Metal Management and the following four selected publicly held companies. These companies, referred to as the Metal Management selected companies, were selected primarily because they are publicly traded companies in the metals industry which engage in scrap metal recycling, which is the business in which Metal Management operates:
 
  •  Commercial Metals Company
  •  Gerdau Ameristeel Corporation
  •  Schnitzer Steel Industries, Inc.
  •  Sims Group Limited
 
CIBC World Markets reviewed enterprise values of the Metal Management selected companies, calculated as fully-diluted market value based on closing stock prices on September 21, 2007, plus net debt, as a multiple of latest 12 months earnings before interest, taxes, depreciation and amortization, which is referred to as EBITDA, and calendar year 2007 estimated EBITDA. CIBC World Markets also reviewed closing stock prices


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of the Metal Management selected companies on September 21, 2007 as a multiple of latest 12 months earnings per share, which is referred to as EPS, and calendar year 2007 estimated EPS.
 
Sims.  CIBC World Markets reviewed financial and stock market information of Sims and the following seven selected publicly held companies. These companies, referred to as the Sims selected companies, were selected primarily because they are publicly traded companies in the metals industry which engage in scrap metal recycling (which is the principal business in which Sims operates) or, given that Sims also engages in other types of metal recycling and has operations that are directly affected by commodity iron ore prices, publicly traded companies in the metals industry engaged in other types of metal recycling or in iron ore mining which, in CIBC World Markets’ view, were deemed relevant for purposes of comparison:
 
  •  Asahi Pretec Corporation
  •  BHP Billiton PLC
  •  Commercial Metals Company
  •  Gerdau Ameristeel Corporation
  •  Metal Management, Inc.
  •  Rio Tinto plc
  •  Schnitzer Steel Industries, Inc.
 
CIBC World Markets reviewed enterprise values of the Sims selected companies as a multiple of latest 12 months EBITDA. CIBC World Markets also reviewed closing stock prices of the Sims selected companies on September 21, 2007 as a multiple of latest 12 months EPS.
 
Based on the implied per share equity reference ranges for Metal Management and Sims calculated by applying a range of selected multiples of the above-referenced metrics derived from the Metal Management selected companies and the Sims selected companies to corresponding data, as adjusted to reflect certain acquisitions and non-recurring items, of Metal Management and Sims, this analysis indicated the following implied exchange ratio reference range, as compared to the exchange ratio provided for in the merger:
 
         
Implied Exchange Ratio
     
Reference Range
  Merger Exchange Ratio  
 
1.5373x — 2.0331x
    2.05x  
 
Selected Precedent Transactions Analysis
 
CIBC World Markets reviewed the transaction values of the following six selected transactions involving companies in the metal recycling industry:
 
         
Announcement Date   Acquirer   Target
 
• 10/16/06
  • Sims   • Metall + Recycling Gmbh
• 04/27/06
 
• European Metal Recycling Ltd. 
  • Southern Recycling, LLC
• 06/24/05
 
• Sims
  • Hugo Neu Corporation
• 06/17/04
 
• IMCO Recycling Inc. 
  • Commonwealth Industries, Inc.
• 03/19/03
 
• IMCO Recycling Inc. 
  • VAW-IMCO Guss und Recycling Gmbh
• 01/14/03
 
• Eco-Bat Technologies PLC
  • Revere Smelting and Refining Corporation (smelting facilities)
 
CIBC World Markets reviewed transaction values in the selected transactions, calculated as the equity value implied for the target company based on the consideration payable in the selected transaction, plus net debt, as a multiple of latest 12 months EBITDA. Financial data for the selected transactions were based on publicly available information at the time of announcement of the relevant transaction. Financial data of Metal Management were provided by the management of Metal Management. Based on the implied per share equity reference range for Metal Management calculated by applying a range of selected multiples of latest 12 months EBITDA derived from the selected transactions to Metal Management’s latest 12 months (as of June 30, 2007) EBITDA, as adjusted to reflect certain acquisitions and non-recurring items, and on the implied per


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share equity reference range derived for Sims from the selected companies analysis described above, this analysis indicated the following implied exchange ratio reference range, as compared to the exchange ratio provided for in the merger:
 
         
Implied Exchange Ratio
   
Reference Range
  Merger Exchange Ratio
 
1.3836x — 1.8298x
    2.05x  
 
Premiums Paid Analysis
 
CIBC World Markets reviewed the premiums paid in 24 selected all-stock transactions announced between January 1, 2005 and September 21, 2007 in which the pro forma equity ownership of the target company’s shareholders upon consummation of the transaction ranged between 20% and 50% relative to the closing stock prices of the target companies in such transactions one trading day, one week and four weeks prior to public announcement of the relevant transaction. Based on the implied per share equity reference range for Metal Management calculated by applying a range of selected premiums derived from the selected transactions to the closing prices of Metal Management common stock one trading day, one week and four weeks prior to September 21, 2007 and on the closing price of Sims ordinary shares on September 21, 2007, this analysis indicated the following implied exchange ratio reference range, as compared to the exchange ratio provided for in the merger:
 
         
Implied Exchange Ratio
   
Reference Range
  Merger Exchange Ratio
 
1.6878x — 1.9635x
    2.05x  
 
Contribution Analysis
 
CIBC World Markets reviewed the relative contributions of Metal Management and Sims to the combined company’s latest 12 months (as of June 30, 2007) net income, as adjusted to reflect certain acquisitions and non-recurring items. Financial data of Metal Management and Sims were provided by the respective managements of Metal Management and Sims. Based on the implied equity ownership percentage of Metal Management’s stockholders in the combined company derived from the relative contributions of Metal Management and Sims to the latest 12 months net income of the combined company, this analysis indicated the following implied exchange ratio reference range, as compared to the exchange ratio provided for in the merger:
 
         
Implied Exchange Ratio
   
Reference Range
  Merger Exchange Ratio
 
1.6733x — 2.2130x
    2.05x  
 
Miscellaneous
 
Metal Management has agreed to pay CIBC World Markets for its financial advisory services in connection with the merger an aggregate fee estimated to be approximately $8.8 million, a portion of which was payable in connection with CIBC World Markets’ engagement, a portion of which was payable upon delivery of its opinion and approximately $8 million of which is contingent upon consummation of the merger. In addition, Metal Management has agreed to reimburse CIBC World Markets for its reasonable expenses, including reasonable fees and expenses of its legal counsel, and to indemnify CIBC World Markets and related parties against liabilities, including liabilities under the federal securities laws, relating to, or arising out of, its engagement. In the ordinary course of business, CIBC World Markets and its affiliates may actively trade the securities of Metal Management and Sims for its and their own accounts and for the accounts of customers and, accordingly, may at any time hold a long or short position in such securities.
 
Metal Management selected CIBC World Markets as its financial advisor based on CIBC World Markets’ reputation and experience. CIBC World Markets is an internationally recognized investment banking firm and, as a part of its investment banking business, is regularly engaged in valuations of businesses and securities in


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connection with acquisitions and mergers, underwritings, secondary distributions of securities, private placements and valuations for other purposes.
 
Sims’s Reasons for the Merger
 
The Sims board of directors, at a meeting held on September 24, 2007, unanimously determined that the merger agreement and the transactions contemplated by the merger agreement were advisable and in the best interests of the shareholders of Sims and approved the merger agreement and the transactions contemplated thereby, including the merger.
 
In reaching this decision, the Sims board of directors considered a range of strategic and financial considerations, including:
 
  •  the combined company would have a leading position in the North American metal recycling market;
 
  •  the complementary nature of Sims’s export-focused and Metal Management’s domestic-focused North American operations and Metal Management’s significant non-ferrous metal recycling operations;
 
  •  the merger provides a sound platform for future growth, including a listing on the NYSE, which would provide acquisition currency for further acquisitions in the recycling industry;
 
  •  the merger would combine two strong management teams with the capabilities to drive further growth, particularly in the North American metal recycling market;
 
  •  that the holders of Sims ordinary shares and the holders of Metal Management common stock would own approximately 70% and 30%, respectively, of the combined company;
 
  •  the merger would have the potential to generate significant cost synergies in North America; and
 
  •  through the achievement of synergies, the merger would have a positive financial impact on Sims.
 
The Sims board of directors also considered a range of risks and other issues, including:
 
  •  that the merger involves a significant increase in Sims’s exposure to the United States domestic market at a time of uncertainty regarding the outlook for the United States economy;
 
  •  the risk that Metal Management’s stockholders may not want to hold securities in a foreign corporation;
 
  •  the terms of the merger agreement, including the restrictions on both parties in pursuing alternative transactions, the requirement that Sims move its executive offices to New York, New York and operational headquarters to Chicago, Illinois, the risk that conditions to the closing of the merger would not be satisfied (including Metal Management stockholders not approving the merger) and the corporate governance arrangements to apply post merger;
 
  •  that the merger will involve significant integration risks, both within the combined company’s North American operations and through the transition of Sims’s head office to the United States;
 
  •  that there would be significant changes in the composition of the board of directors and senior management of the combined company, including a new chief executive officer and chief financial officer;
 
  •  that the merger would require the combined company to comply with the rules and regulations of the SEC and the listing standards of the NYSE applicable to foreign private issuers, which could increase compliance costs;
 
  •  the impact of any conditions imposed by any regulator whose consent to the merger was a condition to completion of the merger;
 
  •  possible lack of liquidity in the trading market for Sims ADSs listed on the NYSE; and


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  •  that Sims ordinary shares have historically traded at a higher price-earnings ratio than Metal Management common stock and that the combination of Sims and Metal Management could result in the shares of the combined company trading at a lower price-earnings ratio than Sims ordinary shares.
 
The Sims board of directors weighed the potential benefits, advantages and opportunities of a merger and the risk of not pursuing a transaction with Metal Management against the risks and challenges inherent in the proposed merger. The Sims board of directors realized that there can be no assurance about future results, including results expected or considered in the factors listed above. However, the Sims board of directors concluded that the potential benefits outweighed the risks for consummating the merger with Metal Management.
 
After taking into account these and other factors, the Sims board of directors unanimously determined that the merger agreement and the transactions contemplated by the merger agreement were advisable and in the best interest of the shareholders of Sims, approved the merger with Metal Management and the other transactions contemplated by the merger agreement, and approved the merger agreement.
 
Interests of Metal Management Directors and Executive Officers in the Merger
 
Certain members of the Metal Management board of directors and executive officers of Metal Management, in their capacities as such, have certain interests in the merger that are in addition to or different from their interests as Metal Management stockholders generally. See “The Merger — Effect of Merger on Metal Management Executive Employment Agreements and Severance Arrangements,” “The Merger — Effect of Merger on Equity Awards” and “The Merger — Indemnification and Directors’ and Officers’ Insurance.” The Metal Management board of directors was aware of these interests and considered them, among other matters, in approving the merger agreement and the transactions contemplated thereby.
 
Board of Directors of Sims Metal Management After the Merger
 
Board of Directors
 
Upon completion of the merger, the Sims Metal Management board of directors will consist of 12 directors. The Sims Metal Management board of directors will consist of seven current Sims directors and the five current Metal Management directors. Paul K. Mazoudier will be the chairman of the board of Sims Metal Management.
 
     
Name and Age
 
Principal Outside Business Activities and Five-Year Employment History
 
Paul K. Mazoudier, 66
  Chairman of Sims since 1999 and Independent Non-Executive Director since 1991; Director of HPAL Limited (2001-2007); Director of AMP Limited (2000-2003); and Director and Chairman of Ambition Group Limited (1999-2003).
Jeremy L. Sutcliffe, 50
  Executive Director and Group Chief Executive of Sims since 2002; Vice President (since 2004) and Board member (since 2002) of the Ferrous Division of the Bureau of International Recycling; Member of the Australian Institute of Company Directors since 2002.
Ross B. Cunningham, 62
  Executive Director (since 1991) and Executive Director, Group Finance and Strategy of Sims; Fellow of the Australian Institute of Company Directors.
J. Michael Feeney, 61
  Independent Non-Executive Director of Sims since 1991; Executive Director, Collins Partners Corporate Advisory until 2007; Director of Ausdoc Group Limited (1999-2002); and Director of Feltex Carpets Limited (2001-2006).
Christopher J. Renwick, 65
  Independent Non-Executive Director of Sims since June 2007; Director of Coal and Allied Industries Limited since 2004, and Chairman since 2005; Director of Downer EDI Limited since 2004; Director of Transurban Group since 2005; and employed with the Rio Tinto group for over 35 years and was Chief Executive, Rio Tinto Iron Ore (1997-2004).


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Name and Age
 
Principal Outside Business Activities and Five-Year Employment History
 
Paul J. Varello, 64
  Independent Non-Executive Director of Sims since 2005; President and Chief Executive Officer of Commonwealth Engineering and Construction of Houston, Texas since 2003; Chairman and Chief Executive Officer of American Ref-Fuel Company (1990-2003); and Independent Director of The Ryland Group, Inc. since 1999.
Masakatsu Iwanaga, 66
  Non-Independent, Non-Executive Director of Sims since June 2007; Member of the Australia & New Zealand Chamber of Commerce in Japan; employed with Mitsui from 1963 through 2005 and worked in various divisions of Mitsui, including as President and Managing Director, Mitsui Iron Ore Development from 1999-2005.
Norman R. Bobins, 64
  Director of Metal Management since 2006; Chairman Emeritus of LaSalle Bank Corp. since 2007; Chairman of LaSalle Bank Corp. from 2000 to 2003; President and Chief Executive Officer of LaSalle Bank Corp. from 2001 to 2007; Chairman, President and Chief Executive Officer of LaSalle Bank N.A. from 2001 to 2007; President of LaSalle Bank Midwest National Association from 2005 to 2007; Director of Global Hyatt Corporation since 2006; Director of Nicor, Inc. since 2007; Director of RREEF America REIT II, Inc. since 1996; and Director of AAR Corp. since 2007.
Daniel W. Dienst, 42
  Director of Metal Management since 2001; Chairman of the Board of Metal Management since 2003, Chief Executive Officer and President of Metal Management since 2004; and Managing Director of the Corporate and Leveraged Finance Group of CIBC World Markets (2000-2004).
John T. DiLacqua, 55
  Director of Metal Management since 2001; and Executive Chairman of Envirosource, Inc. from May 2004 until his retirement in December 2004, President and Chief Executive Officer of Envirosource, Inc. (1999-2004).
Robert Lewon, 64
  Director of Metal Management since 2004; served as a consultant to scrap metal companies since his retirement from Simsmetal USA Corp. in 1993.
Gerald E. Morris, 74
  Director of Metal Management since 2004 and designated lead director since 2006; President and Chief Executive Officer of Intalite International N.V., a position he has held for more than five years; and Director and Chairman of the audit committee of Beacon Trust Company.
 
If any of the foregoing persons is unavailable for any reason to serve as a director of Sims Metal Management upon the effective date of the merger, the board of directors of Sims or Metal Management, as applicable, will be entitled to designate another person to serve on the board of directors of Sims Metal Management.
 
Under the merger agreement, Sims Metal Management directors will serve three-year terms and be eligible for reelection to further three-year terms. Three of the four former Metal Management non-executive directors will stand for reelection at the 2008 annual general meeting of Sims Metal Management shareholders. The fourth former Metal Management non-executive director, who has not yet been identified, will not stand for reelection and will retire and, therefore, will no longer be a Sims Metal Management director after Sims Metal Management’s 2008 annual general meeting of shareholders.
 
If any of the former Metal Management non-executive directors vacates his directorship prior to the 2008 annual general meeting of shareholders, whether due to removal, resignation or death, the former Metal Management directors will have the exclusive authority to nominate individuals to fill such vacant seats, as long as the nominees are reasonably acceptable to the Nomination Committee of the Sims Metal Management board of directors.

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Board Committees
 
Following completion of the merger, the board of directors of Sims Metal Management will have six committees; the Safety, Health, Environment & Community Committee, the Risk & Audit Committee, the Remuneration Committee, the Finance & Investment Committee, the Nomination Committee and the Integration Committee. The composition of each Committee will be determined in accordance with the merger agreement on or prior to the date of the completion of the merger, subject to the ASX Corporate Governance Council’s Principles of Good Corporate Governance and Best Practice Recommendations, which are referred to as the ASX corporate governance guidelines.
 
Director Compensation
 
Upon completion of the merger, the non-executive directors of Sims Metal Management (other than the chairman of the board) will each receive total annual compensation of A$170,610, excluding any fees received for holding the position of a board committee chair. The chair of the Risk & Audit Committee will receive an annual retainer of A$60,000. The chairs of the Safety, Health, Environment & Community Committee, Remuneration Committee, Finance & Investment Committee and the Integration Committee will each receive an annual retainer of A$30,000. No annual retainer will be paid to the chair of the Nomination Committee. The chairman of the board of Sims Metal Management will receive A$393,800. No board or committee meeting fees are paid. Subject to the Corporations Act, Sims Metal Management’s constitution and listing rules of the ASX and subject to shareholder approval to the extent that annual compensation to non-executive directors would exceed A$2,500,000 in aggregate, the board of directors of Sims Metal Management will have the authority to modify the compensation paid to board and committee members.


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Executive Officers of Sims Metal Management After the Merger
 
The following executive officers of Sims and Metal Management are expected to serve as executive officers of Sims Metal Management following the merger:
 
         
        Expected Position with Sims
    Current Position with Sims or
  Metal Management
Name and Age
 
Metal Management
 
Following the Merger
 
Daniel W. Dienst, 42
  President and Chief Executive Officer of Metal Management   Chief Executive Officer and Chair of the North American Metal Recycling business operations of Sims Metal Management
Jeremy L. Sutcliffe, 50
  Group Chief Executive Officer of Sims   Executive Director and Chair of the Metal Recycling business operations of Sims Metal Management in Australasia and Europe and Recycling Solutions business operations in Australasia and Europe
Ross B. Cunningham, 62
  Executive Director Group Finance and Strategy of Sims   Executive Director of Sims Metal Management
Robert C. Larry, 46
  Executive Vice President, Finance, Chief Financial Officer, Treasurer and Secretary of Metal Management   Executive Vice President and Chief Financial Officer of Sims Metal Management
Graham Davy, 42
  Chief Executive Officer of Sims Metal Recycling European operations and Sims Recycling Solutions global operations   Chief Executive Officer of European Metal Recycling business operations and global Sims Recycling Solutions business of Sims Metal Management
Robert Kelman, 44
  President and Chief Operating Officer of Sims Group USA Holdings   President — Commercial, North America of Sims Metal Management
Darron McGree, 60
  Managing Director of Sims Group Australia Holdings Limited   Managing Director — Australia and New Zealand of Sims Metal Management
Alan D. Ratner, 56
  President of Metal Management Northeast, Inc.   President — Operations, North America of Sims Metal Management
 
Biographical information for Messrs. Dienst, Sutcliffe and Cunningham is included above under “Board of Directors of Sims Metal Management After the Merger.”
 
     
    Principal Outside Business Activities and
Name and Age
 
Five-Year Employment History
 
Robert C. Larry, 46
  Chief Financial Officer of Metal Management since August 1996. Treasurer of Metal Management since April 2004.
Graham Davy, 42
  Chief Executive Officer of Sims’s Metal Recycling European operations since 2007 and Sims Recycling Solutions global operations since 2002.
Robert Kelman, 44
  President and Chief Operating Officer of Sims Group USA Holdings since 2007. Vice President and General Manager of Northeast Metals Operations of Sims Group USA since 2005. Prior to that time, was the Senior Vice President and General Manager of Hugo Neu Schnitzer East, a joint venture between Hugo Neu Corporation and Schnitzer Steel, since 1997.
Darron McGree, 60
  Managing Director of Sims Group Australia Holdings Limited since 2005. Prior to that time, held various senior management positions with Sims since joining the company in 1983.
Alan D. Ratner, 56
  President of Metal Management Northeast, Inc. since April 2001.
 
Additional information about the current Metal Management executive officers can be found in Metal Management’s proxy statement on Schedule 14A for its 2007 annual meeting of stockholders as filed with the


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SEC on July 30, 2007, which is incorporated by reference into this proxy statement/prospectus. See “Where You Can Find More Information.”
 
Compensation During the Last Full Fiscal Year of Directors and Executive Officers
 
Compensation Information Regarding Sims Directors and Executive Officers
 
The following table presents information regarding the compensation (in Australian dollars) paid during the last full financial year ended June 30, 2007 by Sims to each Sims director and executive officer expected to become a director or executive officer of Sims Metal Management following the merger:
 
                                                                                                 
    Short-Term Employee Benefits     Long-Term Benefits                 Share-Based
       
                      Accruals     Post Employment     Payments        
                Other
                                              Options/
       
    Cash
    Non-
    Short-
                Long
          Pension/
    Retire-
          Rights/
       
    Salary
    Monetary
    Term
    STI
    Annual
    Service
    LTI
    Super-
    ment
    LTI
    Restricted
       
    & Fees     Benefits     Benefits     Bonus     Leave     Leave     Bonus     annuation     Benefits     Shares     Stock Units     Total  
    (In Australian dollars)  
 
Directors
                                                                                               
Paul K. Mazoudier
    328,440                                           29,560       41,393                   399,393  
Jeremy L. Sutcliffe
    1,225,739       1,000             959,310       23,829       35,448       458,494       184,011             246,881       305,365       3,440,077  
Ross B. Cunningham
    594,745       1,000             661,600       90,037       54,754       280,000       104,255             70,000       228,102       2,084,493  
J. Michael Feeney
    142,293                                           12,806       19,134                   174,233  
Christopher J. Renwick
    7,662                                           690                         8,352  
Paul J. Varello
    155,100                                                                   155,100  
Masakatsu Iwanaga
    8,352                                                                   8,352  
Executive Officers
                                                                                               
Graham Davy
    462,772       36,495       81,224       344,802                   112,480       55,417                   56,246       1,149,436  
Robert Kelman
    586,357       16,871       12,163       491,556       16,230                     25,102                   171,077       1,319,356  
Darron McGree
    467,085       1,000             254,650       (9,238 )     27,006       110,000       81,915             55,000             987,418  
 
On July 28, 2006, Sims issued, pursuant to its former executive long term incentive plan, 36,738 Sims ordinary shares to Mr. Sutcliffe, 10,417 Sims ordinary shares to Mr. Cunningham and 8,185 Sims ordinary shares to McGree. Also on July 28, 2006, Sims issued performance rights in the amount of 3,003 Sims ordinary shares to Mr. Davy.
 
A total of 20,000 and 3,983 Sims ordinary shares were issued on November 2, 2006 and May 4, 2007, respectively, for no consideration as a result of the vesting of performance rights issued to Mr. Sutcliffe on October 6, 2005 pursuant to his employment contract with Sims.
 
Compensation Information Regarding Metal Management Directors and Executive Officers
 
Information regarding the compensation paid by Metal Management to each Metal Management director and executive officer expected to become a director or executive officer of Sims Metal Management following the merger can be found in Metal Management’s proxy statement on Schedule 14A for its 2007 annual meeting of stockholders under the headings “Proposal No. 1 — Election of Directors” and “Executive Compensation” as filed with the SEC on July 30, 2007, which is incorporated by reference into this proxy statement/prospectus. See “Where You Can Find More Information.”


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Ownership of Sims Ordinary Shares
 
As of November 15, 2007, the directors and executive officers of Sims who will serve as a director or executive officer of Sims Metal Management after the merger own Sims ordinary shares as shown in the table below:
 
                                 
    Directly Owned
  Indirectly Owned
      Percentage of Capital
Name
  Shares   Shares   Total Shares   Stock
 
Paul K. Mazoudier
    14,363             14,363       0.011  
Jeremy L. Sutcliffe
          52,255       52,255       0.041  
Ross B. Cunningham
          10,417       10,417       0.008  
J. Michael Feeney
    1       25,503       25,504       0.02  
Christopher J. Renwick
                       
Paul J. Varello
          4,600       4,600       0.004  
Masakatsu Iwanaga
                       
Graham Davy
    3,003                   0.002  
Robert Kelman
                       
Darron McGree
          8,185             0.006  
 
Also, as of November 15, 2007, Mr. Sutcliffe has 320,464 performance rights, Mr. Cunningham has 81,836 performance rights, Mr. Davy has 94,069 performance rights, Mr. Kelman has 54,507 restricted stock units and Mr. McGree has 66,737 performance rights.
 
As of November 15, 2007, to the knowledge of Sims, the following persons, having provided Sims with substantial shareholder notices in accordance with the Corporations Act, beneficially owned 5% or more of Sims ordinary shares:
 
                 
Principal Shareholders
  Number of Shares   Percentage
 
Mitsui Raw Materials Development Pty Limited
    25,208,600       19.93 %
M & G Investment Funds (1)
    14,169,532       11.20 %
AXA Group
    7,706,433       6.09 %
Perpetual Limited
    6,959,548       5.50 %
Vanguard Precious Metals and Mining Fund
    6,500,000       5.14 %
 
As of November 15, 2007, approximately 120,052,213 Sims ordinary shares were held by record holders with addresses in Australia, which represents approximately 94.9% of the Sims ordinary shares outstanding, and there were approximately 19,439 record holders in Australia, which represents approximately 98.8% of the record holders of Sims ordinary shares.
 
Effect of Merger on Metal Management Executive Employment Agreements and Severance Arrangements
 
Employment Agreement of Daniel W. Dienst
 
If Mr. Dienst resigns for “good reason,” or if Metal Management or Sims after completion of the merger involuntarily terminates Mr. Dienst without “cause,” his employment agreement provides that:
 
  •  for a period of two years after the date of termination, he will be entitled to receive his annual base salary, plus any accrued interest on any payments delayed for purposes of compliance with Code section 409A;
 
  •  for a period of two years after the date of termination, he will be entitled to receive his target annual bonuses for such years, plus any accrued interest on any payments delayed for purposes of compliance with Code section 409A;


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  •  if Mr. Dienst’s termination date occurs before March 31, he will be entitled to receive the pro rata portion of his annual bonus for such year, based on actual performance, plus any accrued interest on any payments delayed for purposes of compliance with Code section 409A;
 
  •  all of his unvested stock options, stock grants or long term incentive plan compensation will immediately become vested; and
 
  •  for a period of two years after the date of termination (other than death, disability or the expiration of the employment agreement), he will be furnished with accident, health and life insurance programs.
 
“Good reason” and “cause” are defined in Mr. Dienst’s employment agreement.
 
In addition, the restricted stock agreements held by Metal Management employees (other than with respect to the restricted stock granted to Mr. Dienst on July 26, 2007) provide that, upon consummation of the merger, all unvested restricted stock will become fully vested. Mr. Dienst had agreed to waive his right to have the restricted stock granted to him on July 26, 2007 vest upon a change of control, but as part of the transaction negotiations, it was agreed that the restricted stock vest upon completion of the merger. The number of shares of Mr. Dienst’s restricted stock that will vest upon completion of the merger is 440,532, including 196,532 shares granted to him on July 26, 2007.
 
On September 24, 2007, Mr. Dienst entered into a letter agreement with Sims that will amend his employment agreement upon completion of the merger to provide that:
 
  •  beginning on July 1, 2008, Mr. Dienst will be eligible to receive an annual bonus under the Sims Metal Management revised short term incentive plan as determined by the Remuneration Committee of Sims Metal Management consistent with the combined salary and cash bonus earnings potential under his employment agreement;
 
  •  beginning on July 1, 2008, Mr. Dienst will be entitled to participate in the Sims Metal Management long term incentive plan for an amount equal to 200% of his base salary, subject to approval of Sims Metal Management shareholders at the 2008 annual general meeting, and thereafter to annual grants under the Sims Metal Management long term incentive plan;
 
  •  on August 1, 2009, Mr Dienst will be entitled to receive a cash bonus of up to $1 million, payable in whole or in part as determined by the Remuneration Committee of Sims Metal Management based upon performance against specified targets set by the Sims Metal Management Integration Committee; and
 
  •  upon consummation of the merger, the restricted stock granted to Mr. Dienst on July 26, 2007 will become fully vested; provided, however, that Mr. Dienst will pay Sims (i) $3 million if he resigns other than for “good reason” before July 1, 2010, (ii) $2 million if he resigns other than for “good reason” before July 1, 2011 and (iii) $1 million if he resigns other than for “good reason” before July 1, 2012.
 
At the request of Sims and by prior agreement with the Metal Management board of directors, Metal Management will pay Mr. Dienst his annual bonus for the period ending March 31, 2008 at or before completion of the merger in an amount equal to 200% of his base salary, plus an additional three months of annualized bonus at the same percentage for anticipated performance through June 30, 2008.
 
If any payment to Mr. Dienst, alone or taken together with any other payment, is deemed to be a “parachute payment” under Code section 280G, it will be reduced to an amount that would no longer constitute a “parachute payment” under the Code. If the reduced amount, however, is less than 90% of the total amounts Mr. Dienst would otherwise have been entitled to receive, he will receive a payment grossed up to an amount such that after payment of the excise tax imposed by Code section 4999, Mr. Dienst will receive the same amount, on an after-tax basis, that he would have received had no excise tax been imposed.
 
A copy of the letter agreement between Sims and Mr. Dienst is filed as an exhibit to the registration statement, of which this proxy statement/prospectus forms a part.


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Employment Agreement of Robert C. Larry
 
If Sims terminates Mr. Larry’s employment within 12 months after completion of the merger, his employment agreement provides that:
 
  •  Mr. Larry will receive a lump sum payment in an amount equal to two times his then-current annual base salary;
 
  •  he will receive COBRA coverage for a period of 18 months to the extent he is eligible; and
 
  •  he has the option to reduce the amount of his severance payments such that they are not subject to an excise tax.
 
In addition, upon completion of the merger, all 45,333 shares of Mr. Larry’s unvested restricted stock will become fully vested.
 
On October 10, 2007, Mr. Larry entered into a letter agreement with Sims that will amend his employment agreement upon completion of the merger to provide that:
 
  •  Mr. Larry’s base salary will be $600,000 per year;
 
  •  beginning on July 1, 2008, Mr. Larry will be eligible to receive an annual bonus of up to 100% of his base salary under the Sims Metal Management revised short term incentive plan as determined by the Remuneration Committee of Sims Metal Management consistent with the combined salary and cash bonus earnings potential under his employment agreement;
 
  •  beginning on July 1, 2008, Mr. Larry will be entitled to participate in the Sims Metal Management long term incentive plan for an amount equal to 100% of his base salary, and thereafter to annual grants under the Sims Metal Management long term incentive plan; and
 
  •  he will receive five weeks of vacation per year.
 
A copy of the letter agreement between Sims and Mr. Larry is filed as an exhibit to the registration statement, of which this proxy statement/prospectus forms a part.
 
At the request of Sims and by prior agreement with the Metal Management board of directors, Metal Management will pay Mr. Larry his annual bonus for the period ending March 31, 2008 at or before completion of the merger in an amount equal to 100% of his base salary, plus an additional three months of annualized bonus at the same percentage for anticipated performance through June 30, 2008.
 
Other Arrangements for Officers and Directors
 
Metal Management may, prior to completion of the merger, grant shares of restricted stock to its employees, including its executive officers, as reasonably determined by the compensation committee of the Metal Management board of directors in an aggregate amount not to exceed 225,000 shares (of which up to a maximum of 75,000 shares may be granted to Mr. Dienst), which are intended to be compensation for fiscal 2008 performance. The Metal Management board of directors has advised Mr. Dienst that any discretionary award of restricted stock to Mr. Dienst in respect of fiscal 2008 performance would be increased by an amount of stock with a value of $1 million in recognition of his extraordinary efforts with respect to the merger (but in no event would the total shares so awarded to him exceed 75,000 shares). Any grant of shares of restricted stock may provide that some or all of such shares will automatically vest upon the consummation of the merger.
 
Metal Management may grant bonuses to certain executive officers (other than its chief executive officer) in an aggregate amount of up $1.5 million prior to completion of the merger.
 
The Metal Management board of directors also approved a special fee payment of $35,000, payable to each of the independent directors of Metal Management, in recognition of the additional time and efforts expended in considering the merger with Sims.
 
Effect of Merger on Equity Awards
 
Options to acquire Metal Management common stock outstanding and unexercised immediately prior to the completion of the merger will remain subject to the same terms and conditions as were in effect with respect to the options immediately prior to the effective time of the merger, except that each of these stock options will be exercisable for Sims ADSs equal to the number of shares of Metal Management common stock


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subject to such option multiplied by 2.05 (rounded down to the nearest whole share), with the new exercise price determined by dividing the existing exercise price by 2.05 (rounded up to the nearest whole cent). Each outstanding unvested Metal Management stock option held by any director, officer or employee will become fully vested and exercisable upon completion of the merger.
 
The table below shows the number of shares covered by Metal Management stock options held by the directors and executive officers of Metal Management and the total number of substitute Sims stock options these directors and executive officers would receive in substitution for these Metal Management stock options upon completion of the merger under the formula described above. The table below also shows the number of shares of Metal Management restricted stock held by the directors and executive officers of Metal Management.
 
                                         
                    Weighted
    Metal
  Metal
  Weighted
      Average
    Management
  Management
  Average
  Sims ADS
  Exercise
    Restricted Stock
  Stock Options
  Exercise Price
  Options
  Price of
Name
  Pre-Merger   Pre-Merger   of Options   Post-Merger   Options
 
Executive Officers
                                       
Christopher R. Dandrow
    9,334                          
Daniel W. Dienst
    440,532       200,000     $ 30.63       410,000     $ 14.94  
Robert C. Larry
    45,333                          
Kenneth P. Mueller
    10,333                          
Alan D. Ratner
    20,333                          
Larry S. Snyder
    11,833                          
Thomas O. Whitman
    17,001                          
Independent Directors
                                       
Norman R. Bobins
          60,000     $ 38.78       123,000     $ 18.91  
John T. DiLacqua
          60,000     $ 38.78       123,000     $ 18.91  
Robert Lewon
          90,000     $ 33.52       184,500     $ 16.35  
Gerald E. Morris
          130,000     $ 28.63       266,500     $ 13.97  
 
All of the Metal Management pre-merger stock options are fully vested other than options to purchase 30,000 of Metal Management common stock held by each Metal Management independent director. All unvested options will fully vest upon completion of the merger. All of the shares of Metal Management restricted stock will fully vest upon completion of the merger.
 
Indemnification and Directors’ and Officers’ Insurance
 
Sims has agreed that, after the merger, Sims will, subject to any limits imposed by the Corporations Act, cause Metal Management to indemnify, defend and hold harmless the present and former directors and executive officers of Metal Management and its subsidiaries, from liabilities and expenses (including reasonable attorney fees and expenses) for acts or omissions occurring at or prior to the effective time of the merger, to the same extent and subject to the same terms and conditions as provided in their respective certificates of incorporation and by-laws as in effect on the date of the merger agreement. These obligations will survive the merger and continue in full force and effect in accordance with their terms.
 
Sims has agreed to use its reasonable best efforts to maintain in effect, for a period of six years after completion of the merger, the current Metal Management directors’ and officers’ liability insurance policies covering acts or omissions occurring at or prior to the effective time of the merger with respect to those persons who are currently covered by Metal Management’s directors’ and officers’ liability insurance policies (or substitute policies with a reasonable and financially sound insurer with substantially similar coverage). If the annual premiums payable with respect to this insurance exceed 200% of the annual premiums paid by Metal Management at the date of the merger agreement for such insurance, Sims will be obligated only to obtain a policy with the maximum coverage available for a cost not exceeding 200% of the annual premiums paid by Metal Management as of the date of the merger agreement.


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No Dissenters’ Rights
 
No holders of record of Metal Management capital stock will be entitled to dissenters’ rights in connection with the merger.
 
Delisting and Deregistration of Metal Management’s Common Stock
 
If the merger is completed, Metal Management common stock will be delisted from the NYSE and will be deregistered under the Exchange Act and Metal Management will no longer be required to file periodic and other reports with the SEC. The Metal Management stockholders will become holders of Sims ADSs and their rights as shareholders will be governed by the Corporations Act, the constitution of Sims, the listing rules of the ASX, general Australian law and the deposit agreement pursuant to which the ADSs will be issued. See “Comparative Rights of Stockholders,” “Description of Sims Ordinary Shares” and “Description of Sims American Depositary Shares.”
 
Regulatory Approvals Required for the Merger
 
Antitrust Approvals
 
Under the HSR Act and the rules promulgated under that act by the Federal Trade Commission, the merger may not be completed until notifications have been filed with the Federal Trade Commission and the Antitrust Division of the Department of Justice, and until the specified waiting period has expired or been terminated. Sims and Metal Management each filed notification and report forms under the HSR Act with the Federal Trade Commission and the Antitrust Division of the Department of Justice on October 9, 2007, and early termination of the waiting period was granted effective as of October 30, 2007. At any time before or after completion of the merger, the federal antitrust authorities could take any action under the antitrust laws as they deem necessary, including seeking to enjoin completion of the merger or seeking divestiture of substantial assets of Sims or Metal Management. The merger is also subject to review under state antitrust laws and could be the subject of challenges by private parties under the antitrust laws.
 
Sims and Metal Management also filed notifications with the competition authorities in China, Germany, Greece and Turkey. The merger has received antitrust clearance from the competition authorities in each of these jurisdictions.
 
Other Regulatory Authorities
 
Sims and Metal Management filed a voluntary notice of the merger with CFIUS under the Exon-Florio Provisions on November 30, 2007. On December 13, 2007, CFIUS notified the parties that it has cleared the merger.
 
Obtaining Regulatory Approvals
 
Although Sims and Metal Management do not expect that any of the foregoing regulatory authorities will raise any significant concerns in connection with their review of the merger, there can be no assurance that Sims and Metal Management will obtain all required regulatory approvals, or that those approvals will not include terms, conditions or restrictions that may have an adverse effect on Sims or Metal Management.
 
Other than the filings described above, neither Sims nor Metal Management is aware of any regulatory approvals required to be obtained, or waiting periods that must expire, to complete the merger. If they discover that other approvals or waiting periods are necessary, they will seek to comply with them. If any additional approval or action is needed, however, Sims or Metal Management may not be able to obtain it, as is the case with respect to other necessary approvals. Even if Sims and Metal Management do obtain all necessary approvals, conditions may be placed on any such approval that could cause either Sims or Metal Management to abandon the merger.
 
Sale of Barges and Tugs
 
Metal Management subsidiaries currently own and operate various barges and tugs, including pursuant to a joint venture, known as Port Albany Ventures LLC, between Metal Management and Donjon Marine


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Company, Inc. These barges and tugs are used in the coastwise trade primarily on New York/New Jersey waterways, the Hudson River, the Sanitary Ship Canal, Des Plaines River and the Chicago River. United States federal law generally prohibits operation of coastwise trade barges and tugs on these waterways by a non-US-citizen-controlled person. After the merger, Metal Management and Port Albany Ventures LLC will no longer be deemed to be US-citizen-controlled persons and will be ineligible to own and operate coastwise trade vessels. Metal Management and Port Albany Ventures LLC intend to transfer these barges and tugs to one or more third party US-citizen-controlled vessel owners for time charter back to Sims Metal Management and Port Albany Ventures LLC. Negotiations to finalize these arrangements are ongoing.
 
Joint Venture Purchase Right
 
In September 2007, Sims completed the merger of its Southern California metal recycling assets with those of Adams Steel LLC, which is referred to as Adams Steel. The newly created joint venture company, SA Recycling LLC, operates within a territory encompassing Southern California, Arizona, Southern Nevada and Northern Mexico and combines Sims’s deep water facility at the Port of Los Angeles with Adams Steel’s two inland shredding operations and extensive network of inland feeder yards. Pursuant to the terms of the SA Recycling operating agreement at the time the transactions contemplated by the merger agreement were publicly disclosed, Sims was required to promptly provide notice to Adams Steel. Adams Steel then was entitled for a period of 30 days to elect to cause SA Recycling to acquire that portion of the business to be conducted by Sims Metal Management within the territory of the joint venture following completion of the merger. This overlapping territory is currently located in Arizona. Since the announcement of the transactions contemplated by the merger agreement, Sims and Adams Steel have agreed to defer this notice requirement until shortly after the consummation of the transactions under the merger agreement.
 
Federal Securities Law Consequences; Resale Restrictions
 
All Sims ADSs that will be distributed to Metal Management stockholders in the merger will be freely transferable, except for restrictions applicable to “affiliates” of Metal Management and except that resale restrictions may be imposed by securities laws in non-U.S. jurisdictions insofar as subsequent trades are made within these jurisdictions. Persons who are deemed to be affiliates of Metal Management may resell Sims ADSs received by them only in transactions permitted by the resale provisions of Rule 145 of the rules and regulations promulgated under the Securities Act or under an effective registration statement or as otherwise permitted under the Securities Act. Persons who may be deemed to be affiliates of Metal Management generally include executive officers, directors and holders of more than 10% of the outstanding shares of Metal Management. The merger agreement requires Metal Management to use reasonable best efforts to deliver to Sims a letter, in form and substance reasonably satisfactory to Sims, from each of Metal Management’s directors and executive officers who are, in Metal Management’s reasonable judgment, affiliates of Metal Management, containing an agreement by the director or executive officer to comply with the provisions of Rule 145 with respect to the Sims ADSs received in connection with the merger. Sims, however, has agreed to file a registration statement before the completion of the merger that will allow resale of Sims ADSs held by or issuable to Metal Management executives and directors.
 
This proxy statement/prospectus does not cover any resales of the Sims ADSs to be received by Metal Management stockholders in the merger, and no person is authorized to make any use of this proxy statement/prospectus in connection with any resale.


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THE MERGER AGREEMENT
 
The following summary describes selected material provisions of the merger agreement, which is included as Appendix A and is incorporated by reference into this proxy statement/prospectus. This summary may not contain all of the information about the merger agreement that is important to you. You are encouraged to carefully read the merger agreement in its entirety.
 
The terms of the merger agreement are intended to govern the contractual rights and relationships, and to allocate risks, between Sims and Metal Management with respect to the merger. The representations and warranties made by Sims and Metal Management to one another were negotiated between the parties for the principal purpose of setting forth their respective rights and obligations regarding closing of the merger if events or circumstances change. While not expected, these changes could nevertheless occur. Moreover, the representations and warranties are themselves specifically qualified in a number of important respects set forth below and you are encouraged to consider those qualifications as you read the representations and warranties in the merger agreement:
 
  •  First, some of the representations and warranties that deal with the business and operations of Sims and Metal Management are qualified to the extent that any inaccuracy would not reasonably be expected to have or result in, individually or in the aggregate, a material adverse effect on the party making the representation and warranty. The materiality standard described in the merger agreement may differ from what may be viewed as material under federal securities laws.
 
  •  Second, none of the representations or warranties will survive the closing of the merger and therefore cannot be the basis for any claims among the parties to the merger agreement after the closing, nor will the parties to the merger agreement be able to assert the inaccuracy of the representations and warranties as a basis for refusing to close except as described below under “— Conditions to Completion of the Merger.”
 
  •  Third, the assertions embodied in certain representations and warranties are qualified by information contained in confidential disclosure letters that the parties to the merger agreement exchanged in connection with signing the merger agreement. Investors are not third-party beneficiaries under the merger agreement and should not rely on such representations and warranties as characterizations of the actual state of facts or circumstances, since they were only made as of the date of the merger agreement and are modified in important part by the underlying disclosure letters. Moreover, information concerning the subject matter of such representations and warranties may change after the date of the merger agreement, which subsequent information may or may not be fully reflected in Metal Management’s public disclosures.
 
The Merger
 
At the effective time of the merger, MMI Acquisition Corporation, which is a newly formed, wholly owned subsidiary of Sims incorporated in Delaware, will merge with and into Metal Management. Metal Management will be the surviving corporation in the merger, and the separate existence of MMI Acquisition Corporation will cease.
 
Effective Time and Completion of the Transaction
 
The effective time of the merger will be the time of filing the certificate of merger with the Secretary of State of the State of Delaware or a later time that is specified by the parties in the certificate of merger. The transaction will be completed as promptly as practicable but in no event later than the second business day after the satisfaction or waiver of each of the conditions to the completion of the transaction (other than those conditions that by their nature are to be satisfied at the completion of the transaction).
 
The transaction is currently expected to be completed in the first calendar quarter of 2008. However, completion of the transaction could be delayed if there is a delay in obtaining the required regulatory approvals or in satisfying any other conditions to the transaction. There can be no assurances as to whether, or when, Sims and Metal Management will obtain the required approvals or complete the transaction. If the


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transaction is not completed by March 31, 2008, either Sims or Metal Management may terminate the merger agreement, unless the failure to complete the transaction by such date results primarily from the failure of the party seeking to terminate to perform its obligations under the merger agreement.
 
Merger Consideration
 
Conversion to Sims ADSs
 
At the effective time of the merger, each share of Metal Management common stock outstanding immediately prior to the effective time (other than any shares of Metal Management common stock owned by Metal Management as treasury stock, by any subsidiary of Metal Management or by Sims or any of its subsidiaries immediately prior to the effective time of the merger) will be converted into the right to receive 2.05 Sims ADSs, each representing one ordinary share of Sims, which is referred to as the exchange ratio, together with the right, if any, to receive cash in U.S. dollars in lieu of any fractional ADSs (see “— Fractional ADSs”).
 
Certain Overseas Shareholders
 
If Sims reasonably determines that the issue of Sims ADSs in the jurisdiction of a relevant proposed recipient of Sims ADSs (other than recipients resident in the United States or any jurisdiction to which Sims ADSs may be issued pursuant to exemptions from the registration and prospectus delivery requirements that apply to public offerings of securities to persons in such jurisdictions) is either prohibited or unduly onerous or impracticable, Sims will have a sales agent designated by it sell Sims ADSs attributable to such persons and pay the proceeds of the sale to such persons as soon as reasonably practicable after the effective time of the merger.
 
Cancellation of Metal Management Common Stock
 
Each share of Metal Management common stock held in treasury by Metal Management, held by any subsidiary of Metal Management or held by Sims or any subsidiary of Sims immediately prior to the effective time of the merger will be canceled, and no payment will be made with respect to such shares.
 
Fractional ADSs
 
Fractional Sims ADSs will not be issued in the merger. Instead, each holder of shares of Metal Management common stock who would otherwise be entitled to receive a fractional Sims ADS in the merger will be entitled to receive a cash payment in U.S. dollars in an amount equal to the fractional part of a Sims ADS multiplied by the U.S. dollar equivalent of the closing price of one Sims ordinary share on the ASX on the last trading day preceding the closing date.
 
Exchange Procedures
 
At the effective time of the merger, Sims will deposit with the principal Melbourne, Australia office of National Australia Bank (as custodian of The Bank of New York, the depositary for the Sims ADSs) the number of Sims ordinary shares equal to the aggregate number of Sims ADSs to be issued to holders of Metal Management common stock as consideration for the merger, and will deposit receipts representing such Sims ADSs with The Bank of New York, the exchange agent for the merger, each for the benefit of holders of shares of Metal Management common stock to be converted into the right to receive Sims ADSs in the merger. Promptly after the effective time of the merger, Sims will cause The Bank of New York to mail to each record holder of Metal Management common stock a letter of transmittal for use in the exchange of such holder’s certificates representing shares of Metal Management common stock for Sims ADSs. Those holders of Metal Management common stock who properly surrender their certificates representing shares of Metal Management common stock in accordance with the exchange agent’s instructions will receive the merger consideration to which the holder is entitled under the terms of the merger agreement. The surrendered certificates representing Metal Management common stock will be canceled. After the effective time of the merger, each certificate representing shares of Metal Management common stock that has not been surrendered will represent only the right to receive the merger consideration.


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Adjustments to Prevent Dilution
 
The merger consideration will be adjusted to provide holders of Metal Management common stock the same economic effect contemplated by the merger agreement if at any time between September 24, 2007 and the effective time, there is any change in the outstanding shares of capital stock of Metal Management or Sims by reason of any reclassification, recapitalization, stock split or combination, exchange or readjustment, or stock dividend with a record date during such period.
 
Termination of Exchange Fund; Unclaimed Merger Consideration
 
Any portion of the merger consideration, or dividends payable pursuant to the merger agreement, made available to the exchange agent that remains unclaimed by holders of Metal Management common stock for two years after the closing date will be returned to Sims. Thereafter, a holder of Metal Management common stock must look only to Sims for payment of the merger consideration to which the holder is entitled under the terms of the merger agreement. Sims will not be liable to any holder of shares of Metal Management common stock for any amount paid to a public authority under any applicable abandoned property, escheat or similar laws.
 
Distributions with Respect to Unexchanged Shares
 
After the effective time of the merger, holders of shares of Metal Management common stock will be entitled to dividends and other distributions payable with a record date after the effective time of the merger with respect to the number of Sims ADSs (or the underlying Sims ordinary shares) to which they are entitled upon exchange of their shares of Metal Management common stock, without interest, but they will not be paid any dividends or other distributions on such Sims ADSs (or the underlying Sims ordinary shares) until they surrender their Metal Management common stock to the exchange agent in accordance with the exchange agent’s instructions.
 
Transfers of Ownership and Lost Stock Certificates
 
Following the effective time of the merger, Metal Management will not register any transfers of shares of Metal Management common stock on its stock transfer books. If a certificate representing Metal Management common stock is lost, stolen or destroyed, the holder of such certificate will be required to deliver an affidavit (and may be required to deliver a bond) prior to receiving the merger consideration payable in respect of the shares of Metal Management common stock represented by such certificate.
 
Stock Options
 
At the effective time of the merger, each outstanding option to purchase shares of Metal Management common stock granted under Metal Management’s or its subsidiaries’ stock-based compensation or benefit plans, whether vested or unvested, will be converted into an option to acquire Sims ADSs, on the same terms and conditions as were applicable to such option prior to the effective time of the merger, provided that the number of Sims ADSs and the exercise price of the option will be adjusted to reflect the exchange ratio.
 
Warrants
 
Metal Management will use reasonable best efforts to cause, as of or prior to the effective time, the cancellation of all warrants to purchase shares of Metal Management common stock in exchange for the issuance of shares of Metal Management common stock equal to the excess of the fair market value of the total number of shares of Metal Management common stock for which the warrant is the exercisable, determined based on the closing price of a share of Metal Management common stock on the NYSE as of the trading day immediately preceding the closing date over the aggregate exercise price of the warrant by the closing price of a share of Metal Management common stock on the NYSE as of the trading day immediately preceding the closing date. Thereafter, the Metal Management common stock issued in exchange for the warrants will be converted into merger consideration. If Metal Management is unable to obtain the consent of


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any warrant holder, then the Metal Management warrants will be exchanged into warrants to purchase Sims ADSs in a manner exempt from taxation under Section 409A of the Code.
 
Corporate Governance Matters
 
New Corporate Name
 
Under the merger agreement, Sims has agreed to seek shareholder approval at its next annual general meeting of shareholders after the effective time of the merger to change its corporate name to “Sims Metal Management Limited.”
 
Executive Offices
 
After the merger, the group accounting consolidation and external financial reporting processes of Sims Metal Management will be progressively relocated to the United States until approximately September 2008. The corporate headquarters of Sims Metal Management will be located in New York, New York and the operational headquarters of Sims Metal Management will be located in Chicago, Illinois. The Sims Metal Management board of directors may change the corporate headquarters or operational headquarters of Sims Metal Management after the effective time of the merger.
 
Board of Directors of Sims Metal Management Following the Merger
 
Upon the effective time of the merger, the board of directors of Sims Metal Management will have 12 directors, as follows:
 
  •  four non-executive directors of Metal Management to be designated by Metal Management;
 
  •  three non-executive directors of Sims to be designated by Sims;
 
  •  two Sims directors to be designated by Mitsui, one of whom will be independent of Mitsui for the purpose of the ASX corporate governance guidelines; and
 
  •  Jeremy L. Sutcliffe, Daniel W. Dienst and Ross B. Cunningham.
 
Metal Management has designated Norman R. Bobins, John T. DiLacqua, Robert Lewon and Gerald E. Morris, and Sims has designated Paul K. Mazoudier, J. Michael Feeney and Paul J. Varello, to serve as non-executive directors of Sims Metal Management following the merger. Mitsui has designated Masakatsu Iwanaga to serve as its representative director and Christopher J. Renwick to serve as a non-executive director of Sims Metal Management following the merger.
 
The members of the Sims Metal Management board of directors will serve three-year terms and will thereafter be eligible for reelection to three-year terms according to the listing rules of the ASX. Unless it would result in a breach of their fiduciary duties, the members of the Sims board of directors will recommend the election of three of the four designees of Metal Management at the first annual general meeting of Sims after the effective time of the merger. In addition, if any of the Metal Management designees vacates his seat prior to the first annual general meeting of Sims after the effective time of the merger, the remaining designees of Metal Management will have the exclusive authority to nominate individuals to fill such vacant seats, as long as the nominees are reasonably acceptable to the Nomination Committee of the Sims Metal Management board of directors.
 
Sims is entitled to designate Mr. Mazoudier or, if he is unavailable, one of the other directors designated by Sims to serve as the non-executive chairman of the Sims Metal Management board of directors as of the effective date of the merger. The initial term of the chairman will expire as of the date of the first meeting of the Sims Metal Management board of directors following Sims Metal Management’s annual general meeting of shareholders in or around November 2009. In addition, if Mr. Cunningham’s employment with Sims Metal Management ceases, Mr. Cunningham will cease to be a director and the number of directors comprising the Sims Metal Management board of directors will be reduced accordingly.


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If, in connection with the arrangements between Sims and Mitsui, Mitsui ceases to be entitled to designate one or both of the Sims Metal Management directors it is entitled to designate, the director seat or seats formerly occupied by the Mitsui representative or representatives will be eliminated and the number of directors comprising the Sims Metal Management board of directors will be reduced accordingly.
 
Executive Positions
 
As of the effective time of the merger, Mr. Dienst will be appointed as chief executive officer of the combined company, and Mr. Larry will be appointed as chief financial officer of the combined company. If Mr. Dienst or Mr. Larry is unable or unwilling to hold his respective office, his successor will be selected by the Sims Metal Management board of directors.
 
Representations and Warranties
 
The merger agreement contains various mutual representations and warranties by Sims and Metal Management that relate to:
 
  •  corporate organization;
 
  •  corporate authority, approval and opinion of financial advisor;
 
  •  approvals, governmental filings and absence of violations;
 
  •  capital structure;
 
  •  subsidiaries;
 
  •  SEC (in the case of Metal Management) and ASX and the Australian Securities and Investments Commission (in the case of Sims) filings and financial statements;
 
  •  compliance and governance matters;
 
  •  absence of undisclosed liabilities;
 
  •  absence of material adverse changes;
 
  •  litigation and legal compliance;
 
  •  contract matters;
 
  •  tax matters;
 
  •  employee benefit plans;
 
  •  environmental matters;
 
  •  title to properties;
 
  •  intellectual property matters;
 
  •  employees and labor matters;
 
  •  takeover statutes; and
 
  •  advisors and finders.
 
Certain representations and warranties of Sims and Metal Management are qualified as to materiality or as to “material adverse effect.” When used with respect to Sims or Metal Management, material adverse effect means any events, facts, changes or circumstances which would have a material adverse effect on the business, financial condition, operations or results of operations of Sims or Metal Management, as the case may be, and its respective subsidiaries taken as a whole, but excluding any effect to the extent resulting from or arising in connection with:
 
  •  any general change in economic, regulatory or political conditions;


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  •  any change, effect, event, occurrence, state of facts or development generally affecting the financial or securities markets;
 
  •  any change, effect, event, occurrence, state of facts or development generally affecting the recycling industries;
 
  •  any change in the foreign currency exchange rates applicable to the Australian or U.S. dollar;
 
  •  any adverse change attributable to the execution of the merger agreement or the transactions contemplated by the merger agreement;
 
  •  any failure by Metal Management or Sims or their respective subsidiaries to meet any internal or published projections, forecasts or revenue or earnings predictions (other than as a result of an event otherwise constituting a material adverse effect);
 
  •  any action expressly required to be taken by Metal Management or Sims or their respective subsidiaries pursuant to the merger agreement; or
 
  •  any action or inaction by Metal Management or Sims or any other their respective subsidiaries approved or consented to in writing by the other party after the date of the merger agreement.
 
The representations and warranties made by each of Metal Management and Sims are subject to information disclosed in the confidential disclosure letters that each of Sims and Metal Management delivered to the other. In addition, the representations and warranties are subject to information in Metal Management’s SEC filings and Sims’s filings with the ASX or Australian Securities and Investments Commission.
 
Covenants and Agreements
 
Conduct of Sims and Metal Management
 
Each of Sims and Metal Management has agreed that until the effective time of the merger or termination of the merger agreement, it will conduct its operations in the ordinary course consistent with past practice. The merger agreement also provides that except as expressly contemplated by the merger agreement or otherwise disclosed in the disclosure letters each party provided to the other, each of Metal Management and Sims will not, and will not permit its subsidiaries to:
 
  •  amend its or any of its subsidiaries’ organizational documents if such amendment would have a material adverse effect;
 
  •  authorize or effect any stock split or combination or reclassification of shares of its or any of its subsidiaries’ capital stock if such action would have a material adverse effect;
 
  •  repurchase, redeem or otherwise acquire for value any shares of its capital stock, or any other securities exercisable or exchangeable for or convertible into shares of its capital stock, or declare or pay any dividend or distribution with respect to its capital stock, except for (i) in the case of Metal Management, regular quarterly cash dividends in an amount per share not exceeding the amount of the most recent quarterly dividend paid by Metal Management and (ii) in the case of Sims, regular half yearly cash dividends in an amount per share not exceeding the amount of the most recent half yearly dividend paid by Sims (provided that this restriction does not apply to the withholding of Metal Management restricted stock granted pursuant to the terms of its Amended and Restated 2002 Incentive Stock Plan);
 
  •  issue or authorize the issuance of any shares of its capital stock (other than in connection with the exercise of currently outstanding stock options and the issuance of shares pursuant to the Sims or Metal Management employee benefit plans or Sims’s dividend reinvestment plan) or any other securities exercisable or exchangeable for or convertible into shares of its capital stock;
 
  •  merge or consolidate with any entity if it would have a material adverse effect;


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  •  sell, lease or otherwise dispose of any of its capital assets, including any shares of the capital stock of any of its subsidiaries, if it would have a material adverse effect;
 
  •  liquidate, dissolve or effect any recapitalization or reorganization in any form if it would have a material adverse effect;
 
  •  acquire any interest in any business (whether by purchase of assets, purchase of stock, merger or otherwise) or enter into any joint venture if the business or joint venture interest acquired would have a fair market value, as determined in good faith by the board of directors of Sims or Metal Management, as applicable, in excess of $50 million in the aggregate;
 
  •  create, incur, assume or suffer to exist any indebtedness for borrowed money (including capital lease obligations), other than indebtedness existing as of the date of the merger agreement and other indebtedness incurred in the ordinary course of business, consistent with past practice;
 
  •  create, incur, assume or suffer to exist any lien affecting any of its material assets or properties other than in the ordinary course of business, consistent with past practice;
 
  •  except as required as the result of changes in United States or Australian generally accepted accounting principles, change any of the accounting principles or practices used by it or revalue in any material respect any of its assets or properties, other than write-downs of inventory or accounts receivable in the ordinary course of business, consistent with past practice;
 
  •  except as required under the terms of any collective bargaining agreement in effect as of the date of the merger agreement or in the ordinary course of business, consistent with past practice, grant any general or uniform increase in the rates of pay of its employees or grant any general or uniform increase in the benefits under any bonus or pension plan or other contract or commitment;
 
  •  except for any increase required under the terms of any collective bargaining agreement or consulting or employment agreement in effect on the date of the merger agreement or in ordinary course of business, consistent with past practice, increase the compensation payable or to become payable to officers, salaried employees or agents with a base salary in excess of $150,000 per year or increase any bonus, insurance, pension or other benefit plan, payment or arrangement made to, for or with any such officers, salaried employees or agents;
 
  •  make any material tax election or settle or compromise any material tax liability;
 
  •  pay, discharge or satisfy any material claims, liabilities or obligations other than the payment, discharge and satisfaction in the ordinary course of business of liabilities reflected or reserved for in its consolidated financial statements or otherwise incurred in the ordinary course of business, consistent with past practice;
 
  •  settle or compromise any material pending or threatened suit, action or proceeding; or
 
  •  commit to do any of the foregoing.
 
Other Offers
 
The merger agreement provides that Metal Management and its subsidiaries will not, and will use their reasonable best efforts to cause their respective directors, officers, employees, financial advisors, attorneys, accountants, consultants or other agents, advisors or representatives, which are referred to collectively as representatives, not to, directly or indirectly:
 
  •  initiate, solicit or take any action to facilitate or encourage any inquiries with respect to, or the making of, any proposal or offer, which is referred to as an acquisition proposal;
 
  •  engage in any negotiations or discussions with, provide any information or data to or enter into any letter of intent, agreement in principle, acquisition agreement or similar agreement with any party with respect to an acquisition proposal;


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  •  effect any change in recommendation by Metal Management’s board of directors;
 
  •  grant any waiver or release under any standstill or similar agreement with respect to acquisitions of its shares by any party other than Sims; or
 
  •  propose publicly or agree to any of the foregoing relating to an acquisition proposal.
 
The merger agreement provides that Sims and its subsidiaries will not, and will use their reasonable best efforts to cause their respective representatives not to, directly or indirectly:
 
  •  initiate, solicit or take any action to facilitate or encourage any inquiries with respect to, or the making of, any proposal or offer, which is referred to as an acquisition proposal;
 
  •  engage in any negotiations or discussions with, provide any information or data to or enter into any letter of intent, agreement in principle, acquisition agreement or similar agreement with any party with respect to an acquisition proposal;
 
  •  grant any waiver or release under any standstill or similar agreement with respect to acquisitions of its shares by any party; or
 
  •  propose publicly or agree to any of the foregoing relating to an acquisition proposal.
 
For purposes of the merger agreement, an “acquisition proposal” is any offer or proposal for, whether or not in writing of:
 
  •  all or greater than 20% of the assets of, or more than 20% of the equity interest in, Metal Management and its subsidiaries or Sims and its subsidiaries, each taken as a whole, pursuant to a merger, consolidation or other business combination, sale of shares of capital stock, sale of assets, tender or exchange offer or similar transaction involving Metal Management and its subsidiaries or Sims and its subsidiaries, each taken as a whole, including any single or multi-step transaction or series or related transactions that is structured to permit the party to acquire beneficial ownership of greater than 20% of the assets of, or greater than 20% of the equity interest in, Metal Management and its subsidiaries or Sims and its subsidiaries, each taken as a whole.
 
The merger agreement also provides that each of Sims and its subsidiaries and Metal Management and its subsidiaries will and will cause their respective representatives to immediately cease any discussions and negotiations presently being conducted on September 24, 2007, with respect to any other acquisition proposal.
 
The merger agreement obligates each of Sims and Metal Management to promptly notify the other party upon receipt of any acquisition proposal, or any request for non-public information by any third party that has made or intends to make an acquisition proposal. Such notice must be given in writing no later than 24 hours after the receipt of such acquisition proposal and must identify the third party and set forth the material terms of the acquisition proposal. The merger agreement also provides that each of Sims and Metal Management keep the other party informed of the status and material terms of any such acquisition proposal or request, including any material amendments or proposed material amendments to such acquisition proposal or request.
 
The merger agreement also provides that the above restrictions would not prevent Sims and its board of directors, on the one hand, or Metal Management and its board of directors, on the other hand, at any time prior to, but not after, the time the merger agreement is approved by the requisite vote of such party’s stockholders, from furnishing non-public information to, or entering into discussions with, any person who has made a bona fide written acquisition proposal that was not initiated, solicited, encouraged or facilitated by Sims or Metal Management, as the case may be, or its representatives in violation of the merger agreement, provided that:
 
  •  the party receiving the acquisition proposal provides not less than 48 hours prior written notice of any such action;
 
  •  the board of directors of the party receiving the acquisition proposal determines in its good faith judgment (after consulting with its outside legal counsel and a financial advisor of recognized reputation) that such acquisition proposal is reasonably likely to result in a bona fide acquisition


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  proposal for or in respect of more than 50% of the outstanding shares of capital stock of the party or more than 50% assets of the party and its subsidiaries, taken as a whole, on terms that the board of directors of such party determines in its good faith judgment (after consultation with outside legal counsel and a financial advisor of recognized reputation), taking into account all of the terms and conditions of such acquisition proposal, including any break-up fees, expense reimbursement provisions, conditions to completion and long-term strategic considerations, (i) is reasonably capable of being completed, taking into account all legal, financial, regulatory and other aspects of such proposal, (ii) if providing for the payment of cash to the company or its shareholders, is supported by fully-committed financing subject to customary conditions, and (iii) is more favorable to the company and its shareholders, taken as a whole after consideration of financial and other terms, than the merger (such a proposal being a “superior acquisition proposal”);
 
  •  the board of directors of the party receiving the acquisition proposal determines in its good faith judgment (after consultation with outside legal counsel) that failure to take such action would be reasonably likely to result in a breach of the fiduciary duties of the board of directors under applicable law;
 
  •  the party receiving such acquisition proposal has complied with the terms of the merger agreement relating to acquisition proposals; and
 
  •  the party receiving such acquisition proposal enters into a confidentiality agreement with the third party, on terms no less favorable to the party receiving the acquisition proposal than those contained in the confidentiality agreement between Sims and Metal Management.
 
The merger agreement does not prevent the board of directors of Metal Management from complying with its disclosure obligations under the Exchange Act with regard to an acquisition proposal.
 
Recommendation of the Metal Management Board of Directors; Stockholders Meetings
 
The merger agreement requires Metal Management to take all action necessary to convene a meeting of its stockholders for the purpose of obtaining approval of the transactions contemplated by the merger agreement, as promptly as practicable and no later than 60 calendar days after the registration statement (of which this proxy statement/prospectus forms a part) is declared effective by the SEC.
 
The Metal Management board of directors will recommend that Metal Management stockholders vote to adopt the merger agreement and the transactions contemplated thereby.
 
Notwithstanding the obligations of the Metal Management board of directors described in the preceding paragraph, the Metal Management board of directors will be permitted to withdraw or modify in a manner adverse to Sims its recommendation that its stockholders vote in favor of the approval and adoption of the merger agreement and the transactions contemplated thereby, or recommend any superior proposal, but only if prior to the Metal Management stockholder meeting to vote upon the approval and adoption of the merger agreement and the transactions contemplated thereby, and after receipt of a superior acquisition proposal, the Metal Management board of directors, in the exercise of its fiduciary duties, determines in good faith, after consultation with outside legal counsel, that to do otherwise would be reasonably likely to result in a breach of its fiduciary duties under Delaware law.
 
The merger agreement requires Metal Management to take all necessary action to seek to obtain the approval of its stockholders in favor of the adoption of the merger agreement and the transactions contemplated thereby (subject to the ability of its board of directors to withdraw or modify its recommendation as described above) and to comply with all applicable legal requirements with respect to its stockholders meeting. Regardless of whether its board of directors has effected a change in recommendation, Metal Management will submit the transactions contemplated by the merger agreement for approval by its stockholders.


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The merger agreement requires Sims to take all necessary action to convene a meeting of its shareholders to be held by November 24, 2007 to increase the maximum aggregate amounts payable by Sims to its non-executive directors.
 
Reasonable Best Efforts
 
Metal Management and Sims are each required to cooperate with the other and will use their respective reasonable best efforts to promptly:
 
  •  take or cause to be taken all actions and do or cause to be done all things necessary, proper or advisable under the merger agreement and applicable law to consummate the merger and the transactions contemplated by the merger agreement, including preparing and filing all documentation to effect all necessary filings, applications and other documents;
 
  •  obtain all approvals, consents, registrations, permits, authorizations and other confirmations required to be obtained from any third party required to consummate the merger and the transactions contemplated by the merger agreement;
 
  •  defend any lawsuits or other legal proceedings challenging the merger agreement or the completion of the transactions contemplated by the merger agreement; and
 
  •  execute and deliver any additional instruments necessary to consummate the merger and the transactions contemplated by the merger agreement.
 
Neither Sims nor Metal Management will be required to enter into any agreement, consent decree, mitigation agreement or other commitment requiring Sims or Metal Management or any of their respective subsidiaries to divest or hold separate assets that would reduce by 5% of more the aggregate tonnage of ferrous metal processed on an annualized basis by the parties and their subsidiaries, taken as a whole, as compared with the operations of the parties and their subsidiaries for the 12 months ended June 30, 2007, or to take any other action that would have a material adverse effect on the business, financial condition, operations or results of operations of Sims or Metal Management or their respective subsidiaries, in each case, taken as a whole, or on the ability of Metal Management or Sims to complete the merger or perform their respective obligations under the merger agreement.
 
Directors’ and Officers’ Liability
 
The merger agreement provides that, from and after the closing date, the combined company will indemnify, defend and hold harmless the present and former directors and executive officers of Metal Management and its subsidiaries for actions arising at or prior to the closing date to the extent provided in the organizational documents of Metal Management in effect prior to September 24, 2007. The merger agreement further requires the combined company to, for a minimum of six years following the effective time of the merger, use its reasonable best efforts to maintain coverage under an officers’ and directors’ liability insurance policy on terms and conditions no less advantageous to the directors and officers than the liability insurance policy that Metal Management maintained for its directors and officers prior to the merger, subject to certain limitations, including that Sims is not obligated to make annual premium payments with respect to such policies to the extent the premiums exceed 200% of the annual premiums paid by Metal Management as of September 24, 2007.
 
Employee Matters
 
From the effective time of the merger through June 30, 2008, except as determined by the chief executive officer of Sims in his reasonable discretion, Sims has agreed to preserve the bonus opportunities for those Metal Management employees who had such opportunities immediately before the effective time at levels which are no less favorable than the level of their opportunities immediately before the effective time. Sims has also agreed, from the effective time of the merger through June 30, 2009, except as may be determined by the chief executive officer of Sims in his reasonable discretion, to (i) continue to provide benefits to Metal Management employees under its employee welfare benefit plans and employee pension benefit plans in effect


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at the effective time of the merger, except to the extent that Sims or Metal Management is required to amend the plan pursuant to applicable law, or (ii) provide on a plan by plan basis benefits that are at least as favorable to Metal Management employees as the benefits provided immediately before the effective time under Metal Management’s employee welfare benefit plans and employee pension benefit plans. Sims has also agreed to grant credit for their time of employment by Metal Management to those Metal Management employees who continue after the effective time to work for Sims or Metal Management under all employee benefit plans, programs and policies, including vacation and severance pay plans, programs and policies, in which such employees are eligible to participate, except that Sims and Metal Management are not required to grant credit for the accrual of benefits under a defined benefit plan unless required by law. In addition, as of the effective time of the merger, all vesting conditions with respect to outstanding Metal Management stock options and all outstanding grants of Metal Management restricted stock will be deemed to be fully vested.
 
Proxy Statement and Registration Statement
 
Sims and Metal Management have agreed to cooperate in connection with the preparation of the Metal Management proxy statement contained in this proxy statement/prospectus, the registration statement (of which this proxy statement/prospectus forms a part) to register the Sims ordinary shares to be issued in connection with the merger, and the registration statement to register the Sims ADSs representing the Sims ordinary shares to be issued in connection with the merger. Each party has also agreed, to the extent practicable, to review in advance and consult with each other with respect to the information relating to the other party that appears in the proxy statement/prospectus and other filings made by the parties.
 
Access to Information
 
Each party has agreed to provide the other party, its counsel, financial advisors, auditors and other authorized representatives with full access at all reasonable times to its offices, properties, books and records and other information that is reasonably requested by the other party. All such information is to remain confidential in accordance with the terms of the confidentiality agreement between the parties.
 
Tax Treatment
 
Each of Sims and Metal Management have agreed that they will not take, or fail to take, any action that would prevent the merger from constituting a reorganization within the meaning of Section 368(a) of the Internal Revenue Code.
 
Public Announcements
 
Sims and Metal Management have agreed to consult with each other before issuing any press release or any public statement with respect to the merger agreement, unless otherwise required by applicable law or any rule of the NYSE or the ASX.
 
Notice of Certain Events
 
Each party has agreed to give prompt oral and written notice to the other party of any material development affecting it or any of its respective subsidiaries, including any change or event having, or which would reasonably be expected to have a material adverse effect on one of the parties or would which would cause a material breach of any of the party’s representations, warranties or covenants, or of any material development affecting the ability of the parties to complete the merger. Metal Management has agreed to deliver to Sims a letter identifying all persons who, in Metal Management’s reasonable judgment, are as of record date for the Metal Management stockholders meeting, affiliates of Metal Management for purposes of Rule 145 under the Securities Act. Metal Management will use its reasonable best efforts to cause each person identified as an affiliate to deliver to Sims prior to the effective time of the merger, a written agreement relating to sales of Sims ADSs in accordance with Rule 145.


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Stock Exchange Listing
 
Sims has agreed to use its reasonable best efforts to cause the Sims ADSs to be issued in connection with the merger and made available on the exercise of Metal Management stock options or upon the exercise or conversion of Metal Management warrants to be approved for listing on the NYSE.
 
Fees and Expenses
 
Unless agreed in writing by the parties, each of Metal Management and Sims will pay all costs and expenses incurred by it in connection with the merger agreement, except for the termination fees described below, and except that each of Metal Management and Sims has agreed to pay 50% of the filing fees arising in connection with antitrust filings in connection with the transactions contemplated by the merger agreement and 50% of all printing and mailing costs relating to the preparation and distribution of the registration statement and proxy statement/prospectus.
 
Obligations of Merger Sub
 
Sims has agreed to take all actions necessary to cause MMI Acquisition Corporation to perform its obligations under the merger agreement.
 
Conditions to Completion of the Merger
 
The obligations of Sims, MMI Acquisition Corporation and Metal Management to consummate the merger are subject to the satisfaction or waiver, where legally permissible, of the following conditions:
 
  •  the merger agreement will have been approved by the affirmative vote of the holders of a majority of Metal Management’s outstanding common stock;
 
  •  the registration statement of which this proxy statement/prospectus forms a part will have been declared effective by the SEC, and no stop order suspending its effectiveness will have been issued and remain in effect; and Sims will have received all state securities law authorizations necessary to issue the Sims ADSs pursuant to the merger;
 
  •  the Sims ADSs to be issued to the stockholders of Metal Management in the merger will have been approved for listing on the NYSE, subject to official notice of issuance;
 
  •  the waiting period applicable to the completion of the merger under the HSR Act and certain non-US competition laws will have expired or been earlier terminated, and if a filing with CFIUS is made, the period of time for any applicable review process under the Exon-Florio provisions will have expired, without any action being taken to prevent the completion of the merger;
 
  •  all required governmental consents, authorizations, orders and approvals will have been received and all requisite filings, notices or notifications will have been made, other than those the absence of which would not result in a material adverse effect on either Metal Management or Sims; and
 
  •  none of the parties will be subject to any judgment, decree, order or injunction of a court of competent jurisdiction which prohibits or makes the completion of the merger illegal.
 
The obligation of Metal Management to consummate the merger is subject to the satisfaction or waiver, prior to the effective time of the merger, of the following conditions:
 
  •  the representations and warranties of Sims in the merger agreement relating to the capital stock of Sims will be true and correct in all material respects as of the date specified in such representation and as of the effective time of the merger (provided that the accuracy of representations and warranties that by their terms speak as of a specified date will be determined as of such date);
 
  •  the representations and warranties of Sims set forth in the merger agreement (read without any materiality or material adverse effect qualifications, other than the representation and warranty with respect to no material adverse change, which will be read with a material adverse effect qualification),


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  will be true and correct in all respects when made and at and as of the effective time of the merger as if made at and as of such time (provided that the accuracy of representations and warranties that by their terms speak as of a specified date will be determined as of such date), except for failure to be so true and correct that, individually or in the aggregate, have not had and would not reasonably be expected to have a material adverse effect on Sims;
 
  •  each of Sims and MMI Acquisition Corporation will have in all material respects performed and complied with all of its obligations under the merger agreement required to be performed by it at or prior to the effective time of the merger;
 
  •  Metal Management will have received a certificate from Sims, signed by the chief executive officer and the chief financial officer of Sims, certifying that Sims has performed its obligations under the merger agreement in all material respects and that the representations and warranties of Sims satisfy the conditions set forth above; and
 
  •  Metal Management will have received the opinion of King & Spalding LLP, counsel to Metal Management, that the merger will be treated for U.S. federal income tax purposes as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, and that each of Sims, MMI Acquisition Corporation and Metal Management will qualify as parties to the reorganization within the meaning of Section 368(b) of the Internal Revenue Code.
 
The obligations of Sims and MMI Acquisition Corporation to consummate the merger are subject to the satisfaction or waiver, prior to the effective time of the merger, of the following conditions:
 
  •  the representations and warranties of Metal Management in the merger agreement relating to the capital stock of Metal Management will be true and correct in all material respects as of the date specified in such representation and as of the effective time of the merger (provided that the accuracy of representations and warranties that by their terms speak as of a specified date will be determined as of such date);
 
  •  the representations and warranties of Metal Management set forth in the merger agreement (read without any materiality or material adverse effect qualifications, other than the representation and warranty with respect to no material adverse change, which will be read with a material adverse effect qualification), will be true and correct in all respects when made and at and as of the effective time of the merger as if made at and as of such time (provided that the accuracy of representations and warranties that by their terms speak as of a specified date will be determined as of such date), except for failure to be so true and correct that, individually or in the aggregate, have not had and would not reasonably be expected to have a material adverse effect on Metal Management;
 
  •  Metal Management will have in all material respects performed and complied with all of its obligations under the merger agreement required to be performed by it at or prior to the effective time of the merger; and
 
  •  Sims will have received a certificate from Metal Management, signed by the chief executive officer and the chief financial officer of Metal Management, certifying that Metal Management has performed its obligations under the merger agreement in all material respects and that the representations and warranties of Metal Management satisfy the conditions set forth above.
 
Under Delaware law, the merger cannot become effective unless the merger agreement is adopted by the stockholders of Metal Management. Accordingly, the parties to the merger agreement may not waive this condition to the completion of the merger. At any time prior to the effective time of the merger, the parties to the merger agreement may waive the satisfaction of any of the other conditions to the completion of the merger set forth in the merger agreement. Any waiver is required to be in writing and to be signed by Sims, MMI Acquisition Corporation and Metal Management. See “— Amendment and Waiver.”


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Termination
 
The merger agreement may be terminated and the merger may be abandoned at any time prior to the effective time of the merger, whether before or after the approval by the stockholders of Metal Management of the adoption of the merger agreement and the transactions contemplated thereby:
 
  •  by mutual written consent of Sims and Metal Management;
 
  •  by either Sims or Metal Management if:
 
  •  if a court of competent jurisdiction or other governmental agency has issued a final and nonappealable order, decree or ruling or taken any action restraining or prohibiting the completion of the merger;
 
  •  the merger is not completed by March 31, 2008; unless the failure to complete the merger by that date results primarily from the failure of the party seeking to terminate the merger agreement or perform its obligations;
 
  •  the approval of the Metal Management stockholders was not obtained at the Metal Management stockholders meeting duly convened to vote on the merger, or at any adjournment or postponement of such meeting; or
 
  •  the approval of Sims shareholders for the increase of the maximum aggregate amounts payable by Sims to its non-executive directors was not obtained at the Sims shareholders’ meeting duly convened to vote on such matters, or at any adjournment or postponement of such meeting;
 
  •  by Sims if:
 
  •  prior to the receipt of approval of the merger agreement by Metal Management’s stockholders, the board of directors of Metal Management has withdrawn or modified in a manner adverse to Sims its recommendation that the Metal Management stockholders vote in favor of such matters; or
 
  •  Metal Management materially breaches any of its obligations with respect to (i) holding the meeting of Metal Management stockholders to approve the merger agreement, (ii) preparing and filing with the SEC a proxy statement with respect to the meeting of Metal Management stockholders, (iii) providing Sims with information concerning Metal Management required to be included in the registration statement of which this proxy statement/prospectus forms a part, or (iv) a third party acquisition proposal with respect to Metal Management;
 
  •  Metal Management breaches any of its representations or warranties, or fails to perform any covenant or other agreement in the merger agreement (other than the provisions discussed above), such that the closing conditions to Sims’s obligation to effect the merger would not be satisfied and the breach or failure to perform would not be curable, of if curable, would not be cured within 30 days following receipt of written notice from Sims of such breach or failure to perform;
 
  •  Immediately prior to it entering into a definitive agreement with respect to a superior proposal by a third party to acquire Sims, provided that (i) Sims has not materially violated its obligations under the merger agreement with respect to the superior acquisition proposal, (ii) the Sims board of directors has determined to terminate the merger agreement and has authorized Sims to enter into an agreement with the third party with respect to the superior acquisition proposal, (iii) immediately prior to the termination of the merger agreement, Sims pays to Metal Management the termination fee discussed below, and (iv) immediately after the termination of the merger agreement, Sims enters into the agreement with the third party with respect to the superior acquisition proposal; or
 
  •  Daniel W. Dienst ceases for any reason to continue to serve as the chief executive officer of Metal Management.
 
  •  by Metal Management if:
 
  •  Sims materially breaches any of its obligations with respect to (i) filing a registration statement with the SEC as promptly as practicable to register the issuance of the Sims ADSs to the Metal Management stockholders in connection with the merger, providing Metal Management with information concerning Sims required to be included in proxy statement/prospectus to be delivered to Metal Management stockholders to seek their approval of the transactions contemplated by the


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  merger agreement, filing a registration statement to register the issuance of the Sims ADSs equal to the number of Metal Management shares issuable upon exercise of all Metal Management stock options, and using its reasonable best efforts to cause the Sims ADSs issuable in the merger to be approved for listing on the NYSE, and (ii) a third party acquisition proposal with respect to Sims;
 
  •  Sims breaches any of its representations or warranties, or fails to perform any covenant or other agreement in the merger agreement (other than the provisions discussed above), such that the closing conditions to Metal Management’s obligation to effect the merger would not be satisfied and the breach or failure to perform would not be curable or, if curable, would not be cured within 30 days following receipt of written notice from Metal Management of such breach or failure to perform; or
 
  •  Immediately prior to it entering into a definitive agreement with respect to a superior proposal by a third party to acquire Metal Management, provided that (i) Metal Management has not materially violated its obligations under the merger agreement with respect to the superior acquisition proposal, (ii) the Metal Management board of directors has determined to terminate the merger agreement and has authorized Metal Management to enter into an agreement with the third party with respect to the superior acquisition proposal, (iii) immediately prior to the termination of the merger agreement, Metal Management pays to Sims the termination fee discussed below, and (iv) immediately after the termination of the merger agreement, Metal Management enters into the agreement with the third party with respect to the superior acquisition proposal.
 
Effect of Termination
 
If the merger agreement is terminated as described above, the merger agreement will be void and of no effect, with no liability on the part of any party to the merger agreement, other than the obligation to pay, if applicable, fees and expenses in accordance with the merger agreement, and any damages resulting from any willful and material breach of the merger agreement, including in the case of Metal Management any withdrawal or modification in any manner adverse to Sims of the recommendation by the Metal Management board of directors other than in accordance with the merger agreement. In addition, the parties’ obligations under the confidentiality agreement previously entered into will survive termination of the merger agreement.
 
Termination Fee and Expense Reimbursement
 
Under the merger agreement, Metal Management must pay Sims a termination fee of $25 million:
 
  •  on the second business day after the date of termination of the merger agreement, if Sims terminates the merger agreement because the board of directors of Metal Management has withdrawn or modified in a manner adverse to Sims its recommendation that the Metal Management stockholders vote in favor of the adoption of the merger agreement and the transactions contemplated thereby;
 
  •  on the second business day after the date of termination of the merger agreement, if (i) Sims terminates the merger agreement as a result of the failure of any of Metal Management’s representations and warranties in the merger agreement to be true and correct on and as of the date of the merger agreement, such that the closing conditions to Sims’s obligation to effect the merger would not be satisfied and the breach would not be curable, of if curable, would not be cured within 30 days following receipt of written notice from Sims of such breach and (ii) any director or executive officer of Metal Management has actual knowledge of such failure as of the date of the merger agreement;
 
  •  immediately prior to the termination of the merger agreement, if Metal Management terminates the merger agreement immediately prior to entering into a definitive agreement with respect to a superior proposal by a third party to acquire Metal Management, provided that (i) Metal Management has not materially violated its obligations under the merger agreement with respect to the superior acquisition proposal, (ii) the Metal Management board of directors has determined to terminate the merger agreement and has authorized Metal Management to enter into an agreement with the third party with respect to the superior acquisition proposal, and (iii) immediately after the termination of the merger agreement, Metal Management enters into the agreement with the third party with respect to the superior acquisition proposal; or


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  •  on the second business day after the definitive agreement is signed or the acquisition proposal is completed, whichever is earlier, if (i) either Sims or Metal Management terminates the merger agreement because the stockholders do not approve the merger agreement and the transactions contemplated thereby at the Metal Management stockholders meeting, (ii) between the date of the merger agreement and the date of the Metal Management stockholders meeting, a proposal by a third party to acquire greater than 50% of the assets of or equity interests in Metal Management and its subsidiaries, taken as a whole, has been publicly announced or communicated to the board of directors of Metal Management, or any person or entity has publicly announced a bona fide intention to make such an acquisition proposal, and (iii) within 12 months after the date of termination of the merger agreement, Metal Management enters into a definitive agreement with respect to such an acquisition proposal or such an acquisition proposal is completed.
 
Under the merger agreement, Sims must pay Metal Management a termination fee of $25 million:
 
  •  on the second business day after the date of termination of the merger agreement, if (i) Metal Management terminates the merger agreement as a result of the failure of any of Sims’s representations and warranties in the merger agreement to be true and correct on and as of the date of the merger agreement, such that the closing conditions to Metal Management’s obligation to effect the merger would not be satisfied and the breach would not be curable or, if curable, would not be cured within 30 days following receipt of written notice from Metal Management of such breach and (ii) any director or executive officer of Sims has actual knowledge of such failure as of the date of the merger agreement; or
 
  •  immediately prior to the termination of the merger agreement, if Sims terminates the merger agreement immediately prior to entering into a definitive agreement with respect to a superior proposal by a third party to acquire Sims, provided that (i) Sims has not materially violated its obligations under the merger agreement with respect to the superior acquisition proposal, (ii) the Sims board of directors has determined to terminate the merger agreement and has authorized Sims to enter into an agreement with the third party with respect to the superior acquisition proposal, and (iii) immediately after the termination of the merger agreement, Sims enters into the agreement with the third party with respect to the superior acquisition proposal.
 
Under the merger agreement, Metal Management and Sims must reimburse the other party, within two business days after the submission of statements, for up to $10 million of the out-of-pocket costs and expenses incurred by such party and its subsidiaries in connection with the transactions contemplated by the merger agreement if (i) the party terminates the merger agreement due to a breach by the non-terminating party of any of its representations or warranties, or failure by the non-terminating party to perform any covenant or other agreement in the merger agreement (other than the provisions discussed above), such that the closing conditions to the terminating party’s obligation to effect the merger would not be satisfied and the breach or failure to perform would not be curable or, if curable, would not be cured within 30 days following receipt of written notice from the terminating party of such breach or failure to perform and (ii) the terminating party is not entitled to receive from the other party the termination fee above.
 
Amendment and Waiver
 
The merger agreement may be amended by a writing signed by Sims, MMI Acquisition Corporation and Metal Management at any time before or after the adoption of the merger agreement by the stockholders of Metal Management, provided that after the date of adoption of the merger agreement by the stockholders of Metal Management, no amendment may be made without the approval of the stockholders of Metal Management if such approval is required by Delaware law. At any time prior to the effective time of the merger, the parties may waive compliance with any of the covenants or agreements of the other parties or any breach of any of the representations or warranties of the other parties as long as the waiver is in writing and is signed by Sims, MMI Acquisition Corporation and Metal Management.


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MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
 
General
 
The following is a general discussion of the material United States federal income tax consequences of the merger that may be relevant to United States Holders (as defined below) of Metal Management common stock, and the material United States federal income tax consequences applicable to the ownership and disposition of Sims ADSs held by United States Holders. This discussion is based upon the Code, the Treasury Regulations thereunder, rulings of the Internal Revenue Service, which is referred to as the IRS, judicial decisions and administrative pronouncements in effect on the date of this proxy statement/prospectus. These laws and authorities may change, possibly retroactively, and any change could affect the continuing validity of this discussion. Sims and Metal Management do not presently anticipate seeking any advance income tax ruling from the IRS regarding the tax consequences of the merger or any transactions entered into concurrently or in connection with the merger, and neither Sims nor Metal Management can provide assurances that the IRS will agree with the conclusions expressed herein.
 
For purposes of this discussion, the term “United States Holder” means:
 
  •  an individual citizen or resident of the United States;
 
  •  a corporation or other entity taxable as a corporation created in or organized under the laws of the United States or any political subdivision thereof;
 
  •  an estate the income of which is subject to United States federal income tax without regard to its source; or
 
  •  a trust if a court within the United States is able to exercise primary supervision over its administration and one or more United States persons have the authority to control all of the substantial decisions of such trust.
 
This discussion is addressed only to Metal Management stockholders to the extent that they exchange Metal Management common stock for Sims ADSs in the merger and therefore are treated for United States federal income tax purposes as receiving the Sims ordinary shares represented by such Sims ADSs. This discussion assumes that a United States Holder has held shares of Metal Management common stock as a capital asset within the meaning of Section 1221 of the Code (generally, an asset held for investment) and will hold Sims ADSs received in the merger as capital assets.
 
This discussion is not intended to be a complete analysis and does not address all potential tax consequences that may be relevant to a United States Holder in light of such holder’s particular circumstances. Moreover, this discussion does not apply to a United States Holder that is subject to special treatment under the Code, including a United States Holder that is:
 
  •  a foreign person or entity;
 
  •  a tax-exempt organization, a financial institution, a mutual fund, a dealer or broker in securities or an insurance company;
 
  •  a trader who elects to mark-to-market its securities;
 
  •  a person who holds Metal Management common stock as part of an integrated investment, such as a straddle, hedge, constructive sale, conversion transaction or other risk reduction transaction;
 
  •  a person who holds Metal Management common stock in an individual retirement or other tax-deferred account;
 
  •  a person whose functional currency is not the U.S. dollar;
 
  •  an individual who received shares of Metal Management common stock, or who acquires Sims ADSs or Sims ordinary shares, pursuant to the exercise of employee stock options or otherwise as compensation or in connection with the performance of services;


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  •  a partnership or other flow-through entity (including an S corporation or a limited liability company treated as a partnership for United States federal income tax purposes) and persons who hold an interest in such entities; or
 
  •  a person subject to the alternative minimum tax.
 
If shares of Metal Management common stock are held through a partnership, the tax treatment of a partner will generally depend upon the status of the partner and the activities of the partnership. Any partner of a partnership holding shares of Metal Management common stock should consult its own tax advisor.
 
In addition, this discussion does not address the tax consequences to a United States Holder if such holder is or will become a “5% transferee shareholder” of Sims within the meaning of the applicable Treasury Regulations under Section 367 of the Code. In general, a 5% transferee shareholder is a person that holds Metal Management common stock and will own directly, indirectly or constructively through attribution rules, at least 5% of either the total voting power or total value of Sims shares immediately after the merger. United States Holders that believe they could become 5% transferee shareholders of Sims are strongly encouraged to consult their tax advisors about the special rules and time-sensitive tax procedures, including the requirement to file gain recognition agreements, that might apply regarding their ability to obtain nonrecognition treatment in the merger.
 
With the exception of Australian tax consequences, which are described under “Material Australian Tax Consequences,” this discussion does not address the tax consequences of the merger under foreign, state, local or other tax laws, or the tax consequences of transactions effectuated prior or subsequent to, or concurrently or in connection with, the merger. It is recommended that United States Holders consult their own tax advisors as to the United States federal income tax consequences of the merger, including the income tax consequences arising from such holders’ own unique facts and circumstances, and as to any estate, gift, state, local or non-United States tax consequences, including Australian tax consequences, arising out of the merger and the ownership and disposition of Sims ADSs and/or Sims ordinary shares. It is also recommended that United States Holders consult their tax advisors as to the United States federal income tax consequences of any other transactions entered into in connection with or in contemplation of the merger, which may depend on such holders’ particular situations.
 
United States Federal Income Tax Consequences of the Merger
 
The following discussion as to the United States federal income tax consequences of the merger assumes that the merger will be consummated as described in the merger agreement and this proxy statement/prospectus. Metal Management has received an opinion from King & Spalding to the effect that the merger will be treated for United States federal income tax purposes as a reorganization within the meaning of Section 368(a) of the Code. It is a condition to the completion of the merger that King & Spalding confirms this opinion as of the closing date of the merger. In rendering such opinion, King & Spalding has relied upon certificates of officers of Sims and Metal Management. The tax opinion and the following discussion are not binding on the IRS or any court, however, and do not preclude the IRS or a court from reaching a contrary conclusion. Therefore, while Sims and Metal Management believe that the merger will be treated as a tax-free reorganization under Section 368(a) of the Code, no assurance can be provided that the IRS will agree with this conclusion.
 
A United States Holder that receives Sims ADSs pursuant to the merger will be treated as the owner of the underlying Sims ordinary shares for United States federal income tax purposes. Accordingly, if Sims ADSs are later exchanged for Sims ordinary shares, no gain or loss will be recognized upon the exchange. Subject to the qualifications and limitations set forth above, (i) no gain or loss will be recognized by a United States Holder receives Sims ADSs in exchange for its Metal Management common stock as a result of the merger (except with respect to cash received in lieu of a fractional interest in a Sims ADS, (ii) the aggregate tax basis of the Sims ADSs received in the merger will be the same as the aggregate tax basis of the Metal Management common stock surrendered in exchange therefor and (iii) the holding period of the Sims ADSs received in the merger will include the holding period of the Metal Management common stock surrendered in exchange therefor.


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Any cash received by a United States Holder in lieu of a fractional Sims ADS will likely be treated as if such fractional interest was issued to the United States Holder and then redeemed. The deemed redemption will likely be taxable as a sale of the fractional interest for cash. The amount of any capital gain or loss attributable to the deemed sale will be equal to the amount of cash received with respect to the fractional interest, less the ratable portion of the tax basis of the Metal Management common stock surrendered that is allocated to the fractional interest. If a United States Holder is an individual, any gain recognized will generally be subject to United States federal income tax at a maximum 15% rate if such holder’s holding period in the Metal Management common stock is more than one year on the date of completion of the merger. The deductibility of capital losses is subject to limitations.
 
If the IRS were to successfully challenge the qualification of the merger as a reorganization, a United States Holder would generally be required to recognize gain or loss with respect to the Metal Management common stock surrendered in the merger equal to the difference between such holder’s adjusted tax basis in the surrendered stock and the fair market value, as of the effective time of the merger, of the Sims ADSs (including any fractional Sims ADSs) received or to be received in the merger. Generally, in such event, the United States Holder’s tax basis in the Sims ADSs received would equal the fair market value of such ADSs as of the date of the merger, and the United States Holder’s holding period for the Sims ADSs would begin on the day after the merger. It is recommended that United States Holders consult their tax advisors regarding the allowance or deductibility of any loss they may have with respect to their Metal Management common stock.
 
United States Federal Income Tax Consequences of Holding Sims ADSs
 
Any cash distribution paid by Sims out of its earnings and profits, as determined under United States federal income tax law, will be subject to tax as ordinary dividend income and will be includible in the gross income of a United States Holder when such distribution is received by the holder if the holder holds Sims ordinary shares, or when such distribution is received by the Depositary if the holder holds Sims ADSs. Cash distributions paid by Sims in excess of its earnings and profits will be treated as (i) a tax-free return of capital to the extent of the United States Holder’s adjusted basis in its Sims ADSs (reducing such adjusted basis, but not below zero), and (ii) thereafter as gain from the sale or exchange of a capital asset. Any cash distribution that is treated as a dividend will be includible in the gross income of a United States Holder, for United States federal income tax purposes, in an amount equal to the gross amount (i.e., before Australian withholding tax) of the dividend. A dividend paid in Australian dollars generally will be includible in income in a U.S. dollar amount based on the prevailing U.S. dollar — Australian dollar exchange rate at the time of receipt of such dividend. Such dividend income generally will constitute foreign source income for United States federal income tax purposes. Subject to certain complex limitations, any Australian tax withheld from a cash dividend made to a United States Holder will be treated as a foreign income tax that may be claimed as a credit against the United States federal income tax liability of such holder. Alternatively, any Australian tax withheld may be deducted currently at the election of the United States Holder. See the discussion of Australian withholding tax in the section entitled “Material Australian Tax Consequences.” The dividend income generally will not be eligible for the dividends received deduction allowed to corporations. Under current law, for taxable years that begin after December 31, 2002 and on or before December 31, 2010, dividends paid by Sims will be taxable to a non-corporate United States Holder at the special rate normally applicable to long-term capital gains, provided that (i) Sims qualifies for the benefits of the income tax treaty between Australia and the United States or (ii) Sims ADSs are readily tradeable on an established securities market in the United States. A non-corporate United States Holder will be eligible for this special rate only if it has held the shares for at least 61 days during the 121-day period beginning 60 days before the ex-dividend date.
 
Upon the sale, exchange or other disposition of Sims ADSs, a United States Holder will recognize gain or loss for United States federal income tax purposes equal to the difference between the amount realized upon the disposition and the United States Holder’s tax basis in such Sims ADSs. Such gain or loss will be capital gain or loss and will be long-term if the holding period of such Sims ADSs exceeds one year, including the holding period of the Metal Management shares exchanged for the Sims ADSs. Any such capital gain generally will be treated as United States source income.


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United States Information Reporting and Backup Withholding
 
A United States Holder that receives Sims ADSs in the merger will be required to (i) file a statement with such holder’s United States federal income tax return providing a complete statement of all facts pertinent to the non-recognition of gain or loss upon such holder’s exchange of Metal Management common stock, including the tax basis in the Metal Management common stock that such holder surrendered and the fair market value of the Sims ADSs and any cash that such holder received in the merger and (ii) retain permanent records of these facts relating to the merger.
 
Additionally, a United States Holder may be subject to a backup withholding tax at the rate of 28% with respect to any cash received in the merger in lieu of fractional Sims ADSs, unless such holder (i) is a corporation or comes within certain other exempt categories and, when required, demonstrates this fact, or (ii) provides a correct taxpayer identification number (which for an individual stockholder is the stockholder’s United States social security number), certifies that such holder is not subject to backup withholding and otherwise complies with applicable requirements of the backup withholding rules. To prevent the backup withholding tax on payments made to a United States Holder pursuant to the merger, such holder must provide the exchange agent with a correct taxpayer identification number by completing an IRS Form W-9 or a substitute Form W-9. If a United States Holder does not provide a correct taxpayer identification number, such holder may be subject to penalties imposed by the IRS, as well as the backup withholding tax. However, any amounts withheld under these rules will be credited against a United States Holder’s United States federal income tax liability and may entitle the holder to a refund, provided the required information is timely furnished to the IRS.
 
IT IS RECOMMENDED THAT HOLDERS OF METAL MANAGEMENT COMMON STOCK CONSULT THEIR OWN TAX ADVISORS AS TO THE PARTICULAR UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER AND OF HOLDING SIMS ADSs AND/OR SIMS SHARES, INCLUDING TAX REPORTING REQUIREMENTS AND THE APPLICABILITY AND EFFECT OF ANY STATE, LOCAL OR FOREIGN TAX LAWS.


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MATERIAL AUSTRALIAN TAX CONSEQUENCES
 
Merger
 
United States tax resident holders of Metal Management common stock should realize no taxable gain or loss and receive no taxable income for Australian tax purposes upon the receipt of Sims ADSs to be issued in connection with the merger in exchange for the common stock provided that they are not residents of Australia for Australian tax purposes and they did not acquire and are not using or holding the common stock for the purposes of any business carried on in Australia.
 
Holding Sims ADSs
 
The following discussion provides general information about the material Australian income tax consequences under Australian tax law of holding Sims ADSs as a result of the merger and does not purport to be a complete technical analysis or listing of all potential tax effects to U.S. holders of Sims ADSs. In addition, this discussion may not apply to certain classes of holders such as dealers. It is recommended that prospective recipients of Sims ADSs pursuant to the merger agreement consult their tax advisor as to the tax consequences to them under the laws of Australia of receiving Sims ADSs in the merger and of holding those Sims ADSs.
 
The following discussion regarding dividends does not apply if Sims ADSs are held by a United States holder as business assets through a permanent establishment in Australia. In that case, any dividends are subject to tax in Australia, although credits may be allowed under the franking rules to the extent that the dividends carry franking credits.
 
Under the Australian imputation system of taxation, dividends (as determined for Australian tax purposes) that are “fully franked dividends” paid to a holder of Sims ADSs who is not a tax resident of Australia are free from withholding tax and are not subject to Australian income tax in the hands of such holder of Sims ADSs.
 
Dividends that are not fully franked dividends, are subject to withholding tax on the unfranked portion when paid to a holder of Sims ADSs who is not a tax resident of Australia except to the extent that the dividend is declared to be “conduit foreign income” (in essence income and gains that have a foreign source from an Australian perspective).
 
Depending on the dividend policy of Sims, if the profits out of which Sims pays a dividend have been taxed in Australia at a rate that is less than the maximum Australian corporate tax rate, then the dividend may be partially unfranked or wholly unfranked. Sims will send to holders of Sims ADSs statements that indicate the extent to which dividends are franked, paid out of conduit foreign income and the amount of tax (if any) withheld.
 
If withholding tax is payable, the standard rate is 30% on the portion of the dividend that is subject to withholding tax. Under the tax treaty currently in effect between Australia and the United States, the withholding tax imposed on dividends paid to a United States tax resident who is a “qualified person” for the purposes of the treaty by a corporation resident in Australia (such as Sims) is limited to 15% of the gross dividend.
 
A United States holder of Sims ADSs (who is not also a tax resident of Australia and who does not hold Sims ADSs as a business asset through a permanent establishment in Australia) with no other Australian source income is not required to file an Australian income tax return.
 
Upon the sale, exchange or other disposition of Sims ADSs, a United States holder who is not a tax resident of Australia and has not held or disposed of such Sims ADSs in the course of activities conducted or carried on in Australia, is generally only liable to tax in Australia if (i) such U.S. holder of Sims ADSs has, either alone or in combination with associates (as defined in the Income Tax Assessment Act 1997, as amended), held 10% or more of the issued share capital of Sims throughout a 12-month period beginning 24 months from the date of disposal for Australian capital gains tax purposes and (ii) more than 50% of the total market value of Sims’s worldwide assets is represented by “taxable Australian real property.”
 
There should be no Australian stamp duty or other transfer tax on a sale, exchange or other disposition of Sims ADSs by a United States holder.
 
Neither Australia nor any political subdivision of Australia imposes any gift, estate or death tax or duty in respect of the gift, devise or bequest of Sims ADSs.


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MANAGEMENT AND OPERATIONS AFTER THE MERGER
 
Board of Directors of the Combined Company Following the Effective Time of the Merger
 
Upon the effective time of the merger, the board of directors of Sims Metal Management will have 12 directors, as follows:
 
  •  four non-executive directors of Metal Management to be designated by Metal Management;
 
  •  three non-executive directors of Sims to be designated by Sims;
 
  •  two Sims directors to be designated by Mitsui, one of whom will be independent of Mitsui for the purpose of the ASX corporate governance guidelines; and
 
  •  Jeremy L. Sutcliffe, Daniel W. Dienst and Ross B. Cunningham.
 
Metal Management has designated Norman R. Bobins, John T. DiLacqua, Robert Lewon and Gerald E. Morris, and Sims has designated Paul K. Mazoudier, J. Michael Feeney and Paul J. Varello, to serve as non-executive directors of Sims Metal Management following the merger. Mitsui has designated Masakatsu Iwanaga to serve as its representative director and Christopher J. Renwick to serve as a non-executive director of Sims Metal Management following the merger.
 
The members of the Sims Metal Management board of directors will serve three-year terms and will thereafter be eligible for reelection to three-year terms according to the listing rules of the ASX. Any director, other than the chief executive officer, appointed by resolution of directors since Sims’s last annual general meeting (such as those directors designated by Metal Management under the merger) must retire (and are eligible for reelection if they so choose) at Sims Metal Management’s next annual general meeting in 2008. Unless it would result in a breach of their fiduciary duties, the members of the Sims board of directors will recommend the election of three of the four designees of Metal Management at the first annual general meeting of Sims after the effective time of the merger. In addition, if any of the Metal Management designees vacates his seat prior to the first annual general meeting of Sims after the effective time of the merger, the remaining designees of Metal Management will have the exclusive authority to nominate individuals to fill such vacant seats, as long as the nominees are reasonably acceptable to the Nomination Committee of the Sims Metal Management board of directors.
 
Sims is entitled to designate Mr. Mazoudier or, if he is unavailable, one of the other directors designated by Sims to serve as the non-executive chairman of the Sims Metal Management board of directors as of the effective date of the merger. The initial term of the chairman will expire as of the date of the first meeting of the Sims Metal Management board of directors following Sims Metal Management’s annual general meeting of shareholders in or around November 2009. In addition, if Mr. Cunningham’s employment with Sims Metal Management ceases, Mr. Cunningham will cease to be a director and the number of directors comprising the Sims Metal Management board of directors will be reduced accordingly.
 
If Mitsui ceases to be entitled to designate one or both of the Sims Metal Management directors it is entitled to designate, the director seat or seats formerly occupied by the Mitsui representative or representatives will be eliminated and the number of directors comprising the Sims Metal Management board of directors will be reduced accordingly.


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Executive Positions
 
As of the effective time of the merger, Mr. Dienst will become group chief executive officer of Sims Metal Management, will chair the combined North American metal recycling business and will have overall responsibility for global marketing, and Mr. Larry will be appointed as chief financial officer of Sims Metal Management. If Mr. Dienst or Mr. Larry is unable or unwilling to hold his respective office, his successor will be selected by the board of directors of Sims Metal Management. Mr. Sutcliffe will continue as an executive director reporting to the new board of directors until at least October 2009 and will chair Sims Metal Management’s metal recycling operations in Australasia and Europe as well as the Sims Recycling Solutions business globally. Mr. Cunningham will also continue as an executive director of Sims Metal Management. Messrs. Sutcliffe and Cunningham will continue to be based in Sydney, Australia.
 
Corporate Name and Headquarters
 
Under the merger agreement, Sims has agreed to seek shareholder approval at its next annual general meeting of shareholders after the effective time of the merger to change its corporate name to “Sims Metal Management Limited.” After the merger, the group accounting consolidation and external reporting processes of Sims Metal Management will be progressively relocated to the United States until approximately September 2008. The corporate headquarters will be located in New York, New York, and the operational headquarters will be located in Chicago, Illinois.
 
Dividend Policy
 
After the merger, the board of directors of Sims Metal Management will have the power to determine the amount and frequency of the payment of dividends with respect to Sims ordinary shares and Sims ADSs, having regard to shareholder expectations and the capital requirements, earnings and cash flow of the business. The board of directors of Sims Metal Management will evaluate the most effective means to provide returns to shareholders, which may include supplementing dividends with other capital management options, including share buybacks. At the outset, it is contemplated that the combined company will return in the order of 45% to 55% of net profit after tax to its shareholders.
 
ACCOUNTING TREATMENT
 
The merger will be accounted for under U.S. GAAP as a business combination under the “purchase method” as defined by Statement of Financial Accounting Standards No. 141, “Business Combinations.” Sims will be the acquirer for financial accounting purposes.
 
Under the purchase method, the cost of the purchase will be based on the market value (with reference to the Sims share price around the date of announcement of the merger) of the new Sims ADSs issued to Metal Management stockholders, the fair value of Metal Management stock options assumed by Sims and the direct transaction costs incurred by Sims. In the Sims Metal Management consolidated financial statements, the cost of the purchase will be allocated to the Metal Management assets acquired and liabilities and contingent liabilities assumed, based on their estimated fair values at the acquisition date, with any excess of the costs over the amounts allocated being recognized as goodwill. This method may result in the carrying value of assets, including goodwill, acquired from Metal Management being substantially different from the former carrying values of those assets.


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UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION
 
The following unaudited pro forma combined financial information, which is referred to as the pro forma financial information, shows the pro forma effect of the consummation of the merger of Sims and Metal Management as provided in the merger agreement as if the merger had occurred on July 1, 2006 for statement of operations purposes and on June 30, 2007 for balance sheet purposes. The pro forma financial information is derived from, and should be read in conjunction with, the historical consolidated financial statements of Sims for its fiscal year ended June 30, 2007, which are included elsewhere in this proxy statement/prospectus, and the historical consolidated financial statements of Metal Management for its fiscal year ended March 31, 2007 and fiscal quarters ended June 30, 2006 and 2007, which are incorporated by reference in this proxy statement/prospectus. The pro forma financial information should also be read in conjunction with the notes set forth under “Notes to Unaudited Pro Forma Combined Financial Information.”
 
The financial statements of Sims and Metal Management and the pro forma financial information have been prepared in accordance with U.S. GAAP. The pro forma financial information has been prepared using the purchase method of accounting.
 
Sims, MMI Acquisition Corporation and Metal Management have entered into the merger agreement, which sets out the terms for the merger. Under the terms of the merger agreement, upon completion of the merger all of the outstanding shares of Metal Management common stock will be automatically converted into the right to receive Sims ADSs. Upon completion of the merger, the shareholders of Sims will own approximately 70% and the pre-merger shareholders of Metal Management will own approximately 30% of the outstanding shares of the combined company resulting from the merger.
 
The pro forma financial information is presented for illustrative purposes only and, therefore, does not purport to represent what the actual results of operations or the combined company’s financial position would have been if the merger occurred on the dates assumed and it is not necessarily indicative of the combined company’s future operating results or combined financial position. In this regard, the pro forma financial information does not give effect to (i) any integration costs that may be incurred as a result of the merger, (ii) any synergies, operating efficiencies and cost savings that may result from the merger, (iii) any benefits that may be derived from the combined company’s growth projects or expansions, (iv) changes in commodities prices subsequent to the dates of such financial information or (v) restructuring charges that may be incurred to fully integrate and operate the combined company more efficiently.
 
The pro forma financial information reflects estimates made by Sims management and assumptions that it believes to be reasonable. The allocation of the purchase price to acquired assets and liabilities is based on valuation estimates made available to Sims by Metal Management. These allocations will be finalized based on valuation and other studies to be performed by management, which may include the services of outside valuation specialists, after the completion of the merger. Accordingly, the purchase price allocation adjustments and related impacts on the pro forma financial information are preliminary and are subject to revision, which may be material, after the completion of the merger.


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Unaudited Pro Forma Combined Statement of Operations Information
 
                                         
    Sims Group
    Metal
    Pro Forma
          Pro Forma
 
    Limited
    Management, Inc.
    Adjustments
          Combined
 
    Fiscal Year
    Period From
    Fiscal Year
          Fiscal Year
 
    Ended June 30,
    July 1, 2006 to
    Ended June 30,
          Ended June 30,
 
    2007     June 30, 2007(1)(2)     2007(1)(2)     Notes     2007(1)(2)  
    (In thousands of Australian dollars, except for per share amounts)  
 
Revenue
  A$ 5,386,044     A$ 3,043,620     A$             A$ 8,429,664  
Operating expenses:
                                       
Cost of sales excluding depreciation
    (4,747,195 )     (2,694,603 )                   (7,441,798 )
General and administrative expense
    (197,157 )     (122,227 )     (800 )     6       (320,184 )
Depreciation and amortization expense
    (73,037 )     (37,503 )     (11,022 )     3,4       (121,562 )
Severance and other charges
          (529 )                   (529 )
                                         
Operating income
    368,655       188,758       (11,822 )             545,591  
Income from joint ventures
    14,050       2,479                     16,529  
Interest expense
    (29,963 )     (3,198 )                     (33,161 )
Interest and other income, net
    11,177       3,224                     14,401  
                                         
Income before income taxes
    363,919       191,263       (11,822 )             543,360  
Provision for income taxes
    (114,045 )     (71,089 )     4,611       9       (180,523 )
                                         
Net income
  A$ 249,874     A$ 120,174     A$ (7,211 )           A$ 362,837  
                                         
Basic earnings per share
  A$ 2.00                             A$ 2.02  
                                         


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Unaudited Pro Forma Combined Per Share Information
 
                 
          Pro Forma
 
          Combined
 
          Fiscal Year Ended
 
          June 30,
 
          2007(1)(2)  
          (In thousands of
 
          Australian dollars, except
 
          for share and per share amounts)  
 
Pro forma net income
          A$ 362,837  
Weighted average number of ordinary shares used in calculating basic earnings per share(3):
            179,596,802  
Effect of dilution:
               
Options, including ordinary shares issued under the Sims Group Employee Share Scheme deemed to be options for accounting purposes
            704,319  
                 
Adjusted weighted average number of ordinary shares used in calculating diluted earnings per share
            180,301,121  
                 
Basic earnings per share
          A$  2.02  
                 
Diluted earnings per share
          A$  2.01  
                 


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Unaudited Pro Forma Combined Balance Sheet Information
 
                                         
    Sims Group
    Metal
    Pro Forma
          Pro Forma
 
    Limited
    Management, Inc.
    Adjustments
          Combined
 
    June 30,
    June 30,
    June 30,
          June 30,
 
    2007     2007(2)(4)     2007(2)     Notes     2007(2)  
    (In thousands of Australian dollars)  
 
ASSETS
Current assets
                                       
Cash and cash equivalents(5)
  A$ 36,795     A$ 26,144     A$             A$ 62,939  
Trade and other receivables, net
    350,181       273,865                     624,046  
Inventories
    359,316       288,180       30,813       1       678,309  
Deferred income tax assets
    14,467       6,590                     21,057  
Prepaid expenses and other assets
          13,426                     13,426  
Derivative financial instruments
    14,798                           14,798  
                                         
Total current assets
    775,557       608,205       30,813               1,414,575  
Non-current assets
                                       
Investments in joint ventures
    58,575       24,998                     83,573  
Property and equipment, net
    531,918       235,412       100,129       4       867,459  
Retirement benefit surplus
    8,819                           8,819  
Deferred income tax assets
    50,641       11,927                     62,568  
Other Assets
          3,524       (1,788 )     5       1,736  
Intangible assets, net
    93,988       30,478       140,342       3       264,808  
Goodwill
    459,537       31,593       1,080,018       2       1,571,148  
                                         
Total non-current assets
    1,203,478       337,932       1,318,701               2,860,111  
                                         
Total assets
  A$ 1,979,035     A$ 946,137     A$ 1,349,514             A$ 4,274,686  
                                         
 
LIABILITIES
Current liabilities
                                       
Trade and other accounts payables
  A$ 378,180     A$ 206,096     A$ 30,000       10     A$ 614,276  
Derivative financial instruments
    492                           492  
Income tax payable
    35,403       12,495                     47,898  
Other accrued liabilities
    16,754       30,603                     47,357  
Deferred income tax liabilities
    7,012                           7,012  
Current portion of long-term debt
          853                     853  
                                         
Total current liabilities
    437,841       250,047       30,000               717,888  
Non-current liabilities
                                       
Long-term debt
    339,538       110,992                     450,530  
Deferred income tax liabilities
    82,397             105,518       7       187,915  
Other accrued liabilities
    18,892       11,032                     29,924  
                                         
Total non-current liabilities
    440,827       122,024       105,518               668,369  
                                         
Total liabilities
  A$ 878,668