SouthGobi Received Notice of CHALCO’s Intention to Make a Proportional Take-Over Bid at C$8.48 Per Share

SouthGobi Resources Ltd. (TSX:SGQ) entered into a Cooperation Agreement with Aluminum Corporation of China Ltd. (“CHALCO”), and has also received notice that CHALCO intends to make a take-over bid for up to 60% of the issued and outstanding common shares of SouthGobi at C$8.48 per share.

As quoted in the press release:

SouthGobi has been informed that CHALCO intends to make a take-over bid for up to 60% of the issued and outstanding common shares of SouthGobi at C$8.48 per share (“Proportional Offer”). SouthGobi has also been informed by its 57.6% major shareholder, Ivanhoe Mines Ltd. (“Ivanhoe”), that Ivanhoe has signed a lock-up agreement with CHALCO, committing to tender all of its shares held or thereafter acquired by it during the Offer Period of CHALCO into the Proportional Offer. The Proportional Offer will be made by way of a takeover bid circular under British Columbia law and will be made to all SouthGobi shareholders. If shareholders tender more than 60% of the outstanding common shares of SouthGobi to the take-over bid, a proportional amount of shares will be taken up from each shareholder. SouthGobi has not received any formal documentation relating to the Proportional Offer.

SouthGobi’s board of directors has established a special committee comprising independent directors including Pierre Lebel (Chair), Gordon Lancaster, Andre Deepwell and Robert Hanson to consider the Proportional Offer, when received. The special committee has engaged Blake, Cassels & Graydon LLP as its independent legal counsel and will engage an independent financial advisor to assist with its review of the Proportional Offer. SouthGobi is advising that Shareholders take no action in connection with the Proportional Offer until they receive further information and advice from the special committee.

Click here to read the SouthGobi Resources Ltd. (TSX:SGQ) press release