A privately held company in China called Novel Sunrise Investments will become the largest shareholder in SouthGobi Resources (TSX: SGQ; HK: 1878) after it acquires shares from Turquoise Hill Resources (TSX: TRQ; NYSE: TRQ; NASDAQ: TRQ) and completes a private placement in the Mongolia-based coal producer.
Novel Sunrise is part of the Novel Group of companies, which initially rose to prominence on the back of residential and commercial real estate investments before diversifying into construction materials and commodities such as iron ore and coking coal.
The first US$3.5 million tranche of the private placement will enable SouthGobi to keep the lights on through the end of March, while the second tranche of US$4 million will keep the company running until the end of April. As of Feb. 23, SouthGobi’s cash balance stood at US$2.7 million.
The private placement price of 43.2¢ per share is a 20% discount to SouthGobi’s five day volume weighted average trading price of 54¢ per share.
Read the complete article at NorthernMiner.com/news/southgobi