Clifford Chance

Clifford Chance advises Chalco on C$925 million takeover bid of SouthGobi

Leading international law firm Clifford Chance has advised Aluminum Corporation of China Limited (Chalco) on its C$925 million takeover bid to purchase up to 60% of the issued and outstanding common shares of SouthGobi Resources Ltd. (SouthGobi), a dual-listed company in Canada and Hong Kong, at C$8.48 per share. 

Ivanhoe Mining Limited (Ivanhoe), the controlling shareholder of SouthGobi which owns 57.6% of SouthGobi's equity interests, has entered into a lock-up agreement with Chalco to sell all of its shares in SouthGobi, on a pro rata basis, to Chalco to support Chalco's takeover bid of SouthGobi.  Ivanhoe would receive a total of C$889 million for selling its entire stake or a lower amount to C$533 million for 60% of its stake, depending on how much stock is tendered by other shareholders of SouthGobi.

Beijing partner Tim Wang who led team and has worked on previous deals for Chinalco said, "We are pleased to have assisted Chalco on this significant transaction.  With our strong global network, Clifford Chance is well placed to assist Chinese companies seeking to expand globally."

Clifford Chance has been advising Chinalco, Chalco's parent company since 2008 when the firm first advised on Chinalco's acquisition of approximately 12% shareholding in Rio Tinto plc, followed in 2009 on the proposed US$19.5 billion strategic partnership with Rio Tinto – which, if it had proceeded, would have been the largest outbound investment undertaken by a Chinese company. More recently, the firm advised Chinalco on its exploration joint venture with Rio Tinto last June.

Tim Wang and Beijing counsel Jean Yu led the team, and were assisted by Hong Kong partner Amy Lo, Beijing associates Tianning Xiang and YuFei Liao.  Shanghai partner Jean Thio and senior associate Eli Gao provided US law advice.

Clifford Chance advised Chalco on Hong Kong and US law and worked closely with PRC law firm JT&N, Chalco's PRC counsel, and Fasken Martineau, Chalco's Canadian counsel.

Chalco is listed on the Hong Kong, New York and Shanghai stock exchanges. It is the largest producer of alumina, primary aluminium and aluminium fabrication products in the PRC, and also the second largest producer of alumina as well as the third largest producer of primary aluminium in the world.

SouthGobi is focused on exploration and development of its Permian-age metallurgical and thermal coal deposits in Mongolia’s South Gobi Region.