Chinese aluminum giant Chalco Tuesday delayed plans to acquire a controlling stake in Mongolia-focused coal miner SouthGobi Resources (CVE:SGQ).
The Chinese metals company is continuing to work on securing regulatory approvals in Mongolia and outside.
In
April, Chalco unveiled a $926 million bid for a controlling interest in
SouthGobi, which owns large coal projects in Mongolia. The proposed
deal has the backing of Ivanhoe Mines Ltd (TSE:IVN)(NYSE:IVN), which currently has a controlling stake in SouthGobi.
Ivanhoe
and Chalco agreed to cooperate with Mongolia to ensure any requirements
under the country's new strategic foreign investment legislation were
satisfied.
Chalco and Ivanhoe said Tuesday they would extend the
time for Chalco to make a proportional takeover bid for up to 60 per
cent of SouthGobi stock by 30 days.
Chalco will make its C$8.48
per share proportional offer to all SouthGobi shareholders on or before
August 3, the companies said. No reason was given for the delay.
Ivanhoe has entered into a lock-up agreement with Chalco and has
agreed to tender all of its SouthGobi shares, on a pro-rata basis.
Ivanhoe, majority-owned by global miner Rio Tinto
(NYSE:RIO)(LON:RIO), plans to use the proceeds from the deal with
Chalco to fund development of the massive Oyu Tolgoi copper-gold project
in Mongolia.
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