Quote:
China Gold acquires copper property in Tibet for US$742 million in stock
By The Canadian Press
VANCOUVER - China Gold International Resources Corp. Ltd. (TSX:CGG) said Monday it has signed a deal to buy a copper property in Tibet from a subsidiary of its own biggest shareholder in an all-stock deal valued at US$742.3 million.
The move is part of a plan by China's biggest gold company to establish China Gold International as a global miner.
The Vancouver-headquartered company, which trades on the TSX, said it will issue 170.3 million common shares at a deemed price of US$4.36 per share for 100 per cent of Skyland Mining Ltd.
Skyland's chief asset is the Jiama copper property in Metrorkongka County, Tibet. — a deposit that is being developed into a combined open-pit and underground mining operation.
The purchase includes assumption of shareholder loans of US$42.3 million made by the vendors, Rapid Result Investments Ltd. and a Hong Kong subsidiary of China National Gold Group Corp., which is owned by the Chinese government.
China National, that country's largest gold producer with an annual output of 89 tonnes, is also the largest shareholder in TSX-listed China Gold International.
The acquisition of Skyland represents "the first significant step" by China National to establish the Vancouver miner "as its international flagship company," company chairman Zhaoxue Sun said in a news release.
"As part of the transaction, it is contemplated that the China National Gold Group will grant to the company a non-compete undertaking in which the company will be entitled to any and all mineral property opportunities sourced by China National Gold," the news release added.
China International, meanwhile, would agree not to acquire further gold and non-iron mineral properties in the China.
Completion of the transaction is subject to a number of conditions, including approval from disinterested shareholders, the completion of the Vancouver company's listing on the Hong Kong stock exchange and regulatory approvals.
A special meeting of shareholders to approve the transaction is expected to be held in October, with closing expected in November.
China Gold International shares were down 19 cents, or 3.86 per cent, at $4.73 in trading Monday on the Toronto Stock Exchange.
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http://www.canadianbusiness.com/mark...ntent=b4355824
This one seems very strange to me, quite a large deal for what appears to be a relatively small Vancouver miner. When I looked into it, the firm shares the exact same address in the World Trade Centre as Ivanhoe Mines, who sold a mine in china to China National Gold, which owns 42% of China Gold International resources, which owns the mine Ivanhoe sold to China National.
Ivanhoe is too big a company to be sharing an office, and neither board shares a member, so I dont quite understand what the arrangement is here.
Seems like a shell company set up by China National, but still, why would a Chinese state owned firm share an office with a relatively large Vancouver based gold miner?
Very strange.
Anyone have any insight?