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The Canadian company will receive half of the sum once the transaction is concluded. The balance will be paid on the first anniversary of the deal, it said on Tuesday February 24.

The deal is expected to be inked no later than March 31.

Novel Sunrise is a private investment holding company registered in the British Virgin Islands with affiliated Chinese-based enterprises in real estate, logistics and supply-chain management, according to the statement.

Turquoise Hill had entered into an agreement to sell a 29.95% stake in SouthGobi to Hong Kong-listed National United Resources Holdings in July last year. At the time, Turquoise Hill owned a 56% share in SouthGobi.

This sale is yet to be concluded.

As part of the deal with Novel Sunrise, Turquoise Hill has the option to sell additional shares in SouthGobi at the currently agreed price of C$0.35 per share to the private investment holding company if the transaction with National United Resources is not completed by April 30. Under such circumstances, Novel Sunrise will be obliged to own no more than a 29.99% stake in SouthGobi.

SouthGobi said in a separate statement on Tuesday February 24 that it has entered into a private placement agreement with Novel Sunrise, in which the latter would subscribe to an initial tranche of some 10 million mandatory convertible units for about $3.5 million, and subsequently a further 11.6 million common shares for approximately $4.5 million.

The mandatory convertible units “are convertible on a one-to-one basis for common shares in SouthGobi”, the Mongolian miner said.