China's Shandong Gold says Canada extends review of its bid for Arctic mine

(Reuters) - China’s Shandong Gold Mining Co said on Friday it had been notified by the authorities in Canada that they would extend a security review into the company’s bid to acquire an Arctic gold mine by at least 45 days.

Deals by state-run Chinese miners have faced heightened scrutiny from Canada to Australia this year amid economic dislocation caused by the coronavirus pandemic.

Canada’s federal cabinet ordered the review of Shandong Gold’s proposed C$230 million ($177 million) takeover of TMAC Resources, which operates the Hope Bay mine in the northern and strategically important territory of Nunavut, in mid-October.

In an announcement at the time, TMAC did not put a time frame on the review, which is being made under the Investment Canada Act, but said it expected the transaction to close by the end of the first quarter of 2021, if not by the already extended targeted completion date of Feb. 8.

TMAC on Friday confirmed the extension of the review, but neither Shandong Gold nor TMAC provided a reason for the move.

The review also comes amid a diplomatic rift between Canada and China over the 2018 arrest by Canadian police of Huawei Technologies Co Ltd’s chief financial officer, Meng Wanzhou.

($1 = 1.2992 Canadian dollars)

Reporting by Tom Daly; additional reporting by Arundhati Sarkar in Bengaluru; Editing by Kirsten Donovan, Aditya Soni