Clifford Chance has represented the Aluminum Corporation of China Limited (Chalco) on its $926 million purchase of a stake in Mongolian coal miner SouthGobi Resources from Canada’s Ivanhoe Mines at C$8.48 ($8.45) per share.
Ivanhoe, which owns 57.6 percent of SouthGobi, entered into an agreement with Chalco to sell all its shares in SouthGobi to the Chinese aluminium maker. The Hong Kong price of the offer was HK$65.97.
The deal comes as China aims to slow annual growth in coal output from around 10 percent to 2 percent over the next four years in an attempt to safeguard resources.
Reuters added that the sale would raise capital for Ivanhoe that could be invested in the $6 billion Oyu Tolgoi mine in Mongolia, a copper and gold venture.
Beijing partner Tim Wang and counsel Jean Yu led the Clifford Chance team, and were supported by Hong Kong partner Amy Lo and Shanghai partner Jean Thio. The group advised Chalco on Hong Kong and U.S. law, and worked closely with Chinese law firm JT&N, Chalco’s China counsel, and Fasken Martineau, the company’s Canadian counsel.
Goodmans advised Ivanhoe, while Freshfields Bruckhaus Deringer represented SouthGobi.
Clifford Chance has worked with Chinalco, Chalco’s parent company, since 2008 on its strategic partnership and proposed joint ventures with metals and mining conglomerate Rio Tinto. Chinalco is the largest shareholder in the Rio Tinto Group, holding a 12.9 percent stake.
SouthGobi has a sizeable presence in Mongolia, owning four coal projects, three development projects, and a mineral exploration licence. ALB
Kanishk Verghese is North Asia journalist at ALB. Follow him on Twitter: @ALB_Magazine.
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