Chinese coal firm plans on USD 160 million bid for Inova Resources Ltd

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Shanxi Donghui Coal Cooking & Chemicals Group said it would be offering USD 160 million for Inova Resources Ltd. The latter is an Australian gold and copper mine whose majority owner is Turquoise Hill Resources. The said offer from the coal and chemicals producer would be funded from its cash holdings. Owned by two brothers, the Chinese firm told Reuters that their bid gives "Inova shareholders with certainty of value at an attractive, risk-free, cash premium for their investment."

Shanxi Donghui said it already owned 14.9% of Turquoise Hill. Shanxi further said that Turquoise Hill promised to sell all its shares once their offer would be accepted by 51% of the company's shareholders.

For more than a year now, Turquoise Hill had been evaluating sales of its assets or stake to repay its USD 2.4 billion debt to Rio Tinto. The deadline for repayment is set on December 31 this year. Rio Tinto had been funding the Turquoise Hill's Oyu Tolgoi copper and gold mine located in Mongolia which is the reason for the debt.

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