Mr. Xiaohan Yu of China Investment reports
CHINA INVESTMENT CORPORATION ISSUES THE FOLLOWING PRESS RELEASE IN ACCORDANCE WITH CANADIAN SECURITIES ADMINISTRATORS' NATIONAL INVESTMENT 62-103
China Investment Corp. has issued the following press release in accordance with Canadian securities administrators' National Investment 62-103.
China Investment Corp., by its indirectly wholly owned subsidiary
Land Breeze II SARL (LB), previously filed early warning reports in
respect to a $500-million (U.S.) convertible debenture LB
purchased from SouthGobi Resources Ltd. in respect to the
exercise on March 29, 2010, of SouthGobi's right to call for the
conversion of up to $250-million (U.S.) of the debenture and in respect to
the receiving of paid-in-kind interest on Nov. 21, 2013. China
Investment is a sovereign wealth fund of the People's
Republic of China.
Pursuant to the debenture, since March 29, 2010, LB has acquired
ownership of 13,274,681 common shares of SouthGobi, which includes
6,206,833 common shares previously issued and reported upon, and
7,067,848 common shares issued on Nov. 21, 2014, in each case, in
satisfaction of the paid-in-kind component of the interest accrued on
the debenture.
After giving effect to the issuances noted above, LB owns and
controls 37,917,292 common shares of SouthGobi, representing
approximately 19.51 per cent of the issued and outstanding common shares of
SouthGobi as of Nov. 21, 2014. LB also continues to own $250-million (U.S.) of principal amount under the debenture, which, if converted at
the current conversion price of $8.88 (and the currency exchange rate
of 0.8851) would represent approximately 31.8 million additional common
shares. If the debenture in the principal amount of $250-million (U.S.) that
remains outstanding after the issuances noted above is fully
converted into SouthGobi common shares at the current conversion price
of $8.88 and the currency exchange rate of 0.8851, then, together with
the actual common shares owned or controlled by LB as of the date
hereof, LB would own or control a total of approximately 69.7 million
SouthGobi common shares, or approximately 30.82 per cent of the common shares of SouthGobi.
The amount of interest in respect of the 7,067,848 common shares issued
on Nov. 21, 2014, was $4.5-million, and the price of the common
shares was 64 cents per share.
LB holds SouthGobi common shares and the debenture for investment
purposes. LB has rights under the debenture to convert the remaining
$250-million (U.S.) principal amount under the debenture into common shares
of SouthGobi. Subject to applicable regulatory and contractual
restrictions, LB may, from time to time, dispose of or acquire additional
securities of SouthGobi.
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