Reuters: SouthGobi shares dive on fears Mongolia may derail Chalco bid

Coal miner SouthGobi Resources saw its shares plunge after the Mongolian government suspended its exploration licenses, sparking fears the move may scupper a takeover bid by China’s Chalco. Earlier this month, state-run Aluminium Corp of China Ltd, known as Chalco, agreed to pay $926 million for a 57.6 percent stake in SouthGobi held by mining billionaire Robert Friedland’s Ivanhoe Resources. China sovereign wealth fund CIC CIC.UL owns 13.8 percent of SouthGobi, which is also traded in Toronto but is focused on Mongolia. The SouthGobi offer by Chalco, which would allow China’s top aluminum maker to diversify away from aluminum, appears to have caught Mongolian officials by surprise. Late on Monday, SouthGobi announced in a statement that the Mongolian government suspended the company’s exploration and mining licenses. The suspension included its flagship Ovoot Tolgoi coal mine. To read the full article, click hereSouthGobi shares dive on fears Mongolia may derail Chalco bid

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