Update on CIC Interest Payments Deferral
HONG KONG, CHINA--(Marketwired - Jun 17, 2016) - SouthGobi Resources Ltd. (TSX: SGQ)(HKSE:1878) (the "Company" or "SouthGobi") announces an update on CIC interest payments deferral. The reference is made to the Company's announcement of May 30, 2016, whereby the Company announced that it had executed a deferral agreement with China Investment Corporation ("CIC") for the deferral of approximately U.S.$18.7 million to June 17, 2016, such sum representing the then current and deferred cash interest obligations and associated costs payable to CIC under the terms of a convertible debenture issued by the Company to CIC.
As at the date of this announcement, the Company has not repaid the deferred outstanding interest obligations and associated costs payable to CIC nor reached a repayment plan for the payment of such amounts.
The Company is in discussion with CIC for a repayment plan, however there is no assurance that a repayment plan which is favourable to the Company will be concluded. If the Company is unable to reach an agreement with CIC with respect to repayment of sums owed and is not able to repay such amounts within applicable cure periods, the principal amount owing and all accrued and unpaid interest under the debenture would immediately become due and payable upon notice to the Company by CIC. In such event, the value of the Company's common shares could be materially and negatively affected and, as a result, shareholders of the Company and potential investors are advised to exercise caution when dealing in the securities of the Company.
The Company will provide further updates to these discussions as and when necessary.
About SouthGobi
SouthGobi, listed on the Toronto and Hong Kong stock exchanges, owns and operates its flagship Ovoot Tolgoi coal mine in Mongolia. It also holds the mining and exploration licences of its other metallurgical and thermal coal deposits in South Gobi Region of Mongolia. SouthGobi produces and sells coal to customers in China.
Contact
SouthGobi Resources Ltd.
Kino Fu
Investor Relations
Office: +852 2156 7030
kino.fu@southgobi.com
www.southgobi.com