Chinese state-controlled aluminum miner Chalco has dropped a $926 million bid for up to 60 percent of SouthGobi Resources. The stake is owned by Canadian company Turquoise Hill Resources (TSX:TRQ)(NYSE:TRQ)(NASDAQ:TRQ), developer of the massive Oyu Tolgoi copper-gold complex in Mongolia and formerly Ivanhoe Mines.
The bid has been in doubt since May when Mongolia tightened its foreign investment rules, requiring that bids for more than 49 percent of a company and worth more than $75 million will be subject to scrutiny by a government panel.
As reported in the market news:
After careful consideration, both Turquoise Hill and Chalco have concluded that the proposed transaction has minimal prospect of obtaining the necessary regulatory approvals within an acceptable timeframe. As a result, Turquoise Hill and Chalco have agreed to terminate the lock-up agreement, including Chalco’s obligation to make a proportional offer.