Hong Kong Takeovers Code to Apply to SouthGobi Resources

HONG KONG, CHINA--(Marketwired - June 20, 2014) - Prior to the listing of the securities of SouthGobi Resources Ltd. (TSX:SGQ)(HKSE:1878) (the "Company") on the Stock Exchange of Hong Kong Limited in 2010, the Company applied to Hong Kong's Securities and Futures Commission (the "SFC") for, and was granted, a ruling that the Company is not a public company in Hong Kong for the purposes of the Codes on Takeovers and Mergers and Share Repurchases in Hong Kong (the "Takeovers Code"). Consequently the Takeovers Code has not applied to the Company since the time of its Hong Kong listing.

The Company recently made an application to the SFC for a confirmation of the SFC's prior ruling that the Company is not a public company in Hong Kong for the purposes of the Takeovers Code. The Company made this application so it could assess, with a greater degree of certainty, its options for sourcing the additional financing it requires to continue operating and meet its obligations. See the Company's announcement regarding its first quarter 2014 financial and operating results dated 12 May 2014 for further details regarding the Company's financial position and liquidity.

The Takeovers and Mergers Panel of the SFC ("Takeovers Panel") determined on Thursday, 19 June, 2014 that the Company should be considered a public company in Hong Kong for the purposes of the Takeovers Code. The Takeovers Code will now apply to the Company. The Takeovers Panel will release its written decision on this matter in due course.

The Company has been and continues to be subject to Canadian provincial securities laws, including those governing takeovers, mergers and share repurchases. Certain transactions that would otherwise be exempt under Canadian law from the requirement to make a formal offer to all shareholders may now trigger mandatory offer obligations under the Takeovers Code.

About SouthGobi

SouthGobi is listed on the Toronto and Hong Kong stock exchanges, in which Turquoise Hill, also publicly listed in Toronto and New York, has a 56% shareholding. Turquoise Hill took management control of SouthGobi in September 2012 and made changes to the board and senior management. Rio Tinto has a majority shareholding in Turquoise Hill.

SouthGobi is focused on exploration and development of its metallurgical and thermal coal deposits in Mongolia's South Gobi Region. It has a 100% shareholding in SouthGobi Sands LLC, the Mongolian registered company that holds the mining and exploration licenses in Mongolia and operates the flagship Ovoot Tolgoi coal mine. Ovoot Tolgoi produces and sells coal to customers in China.