Turquoise Hill sells down stake in SouthGobi coking coal asset

Turquoise Hill Resources has agreed to offload part of its 56% stake in Mongolia-based coal miner SouthGobi Resources to Hong Kong-listed National United Resources Holdings.

Paragraph entered by Atlantic migration, in order for SteelFirst articles to display correctly on Metal Bulletin.

The Canadian company will sell a 29.95% stake in SouthGobi for C$25.6 million ($24 million) and retain the other 26%, Turquoise Hill said on Wednesday July 30.

“About C$12.8 million [$11.8 million] in cash will be received by Turquoise Hill at closing, and deferred consideration of about C$12.8 million [$11.8 million] will be payable to Turquoise Hill one year after the closing of the transaction,” a statement said.

Turquoise Hill expected the deal to close no later than November 30.

“SouthGobi will continue to focus on its business and drive to deliver on its 2014 objectives, with the usual high priority on safety,” SouthGobi said.

The company produced 550,000 tonnes of raw coal during the second quarter of this year, down from 640,000 tonnes recorded in the first quarter. It sold 400,000 tonnes of semi-soft coking coal and 510,000 tonnes of thermal coal in the June quarter.

SouthGobi reduced its production and placed about half its workforce on leave in June, following a review of operations in response to market conditions.

“Coal production in the second half of 2014 will be paced to meet contracted sales volumes,” the company said in its operating results statement in early July.

National United Resources is principally engaged in outdoor media advertising and media-related services. It entered the coking coal trading business in 2013 and has sourced materials from Mongolia.

What to read next
Any bolstering effect on US ferrous scrap exports from the up-month in February’s domestic trade will be tempered in the immediate aftermath of two earthquakes in Turkey — the country’s largest importing region — on Monday, February 6
Steel trading and production have come to a halt in the eastern Turkish region of Iskenderun following a devastating earthquake that hit the region on Monday February 6 and put mills in the area under force majeure, sources told Fastmarkets on Tuesday
A 120-day closure of four Illinois dams scheduled for 2023 will disrupt barge shipments and have potentially both negative and positive impacts on scrap and finished steel products from Canada to Texas
Market participants are cautiously optimistic about a rebound in iron ore concentrate premiums, with steelmakers around the world set to ramp-up production in line with an anticipated increase in demand for steel products, Fastmarkets understands
General Motors (GM) is investing $650 million to develop the Thacker Pass mine in Nevada, the largest known source of lithium in the US and the third largest in the world
We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.