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Chinese steelmaker gets stake in Australian merger
Sydney (AFP) Sept 25, 2008 Australian miner Grange Resources Ltd and Chinese-backed Australian Bulk Minerals (ABM) said Thursday they had agreed to merge to capitalise on rising global demand for iron ore. The deal to create a company with a market value of about a billion dollars (840 million US dollars) gives Chinese steel producer Jiangsu Shagang Group Ltd., ABM's biggest shareholder, a 45 percent stake. It will combine ABM's 2.3 million tonne per year Savage River magnetite mining and pellet operation in Tasmania with Grange's Southdown magnetite project in Western Australia. "Combining the magnetite knowledge of ABM and Grange is a benefit that cannot be overstated," Grange managing director Russell Clark said in a statement. "No other company will be able to apply the experience from operating a magnetite iron ore asset like Savage River to a quality development opportunity such as Southdown." The 1.6 billion US dollar Southdown project is expected to start production by 2013 and is a joint venture between Grange, which holds 70 percent, and Japanese group Sojitz Corp. The merger deal will see Grange issue about 380 million shares to ABM shareholders, who will end up with 73.9 percent of the merged entity, while Grange's existing shareholders will have 26.1 percent. In addition to Shagang's 45 percent holding in the combined group, RGL Group Co. Ltd., a Chinese steel trader, will own 13.3 percent and Pacific Minerals, a Hong Kong-based iron ore trader, 8.0 percent. Clark said he is confident Australia's Foreign Investment Review Board will approve the deal, as Shagang is privately-owned so its investment will not raise the same issues as recent Chinese government-backed deals. Chinese interest in Australia's resources sector has grown as it seeks to secure supplies for its rapid economic expansion in the face of steep price rises. The Australian government has said it welcomes foreign investment but will ensure that major deals are in the country's national interest. Community Email This Article Comment On This Article Share This Article With Planet Earth
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China quality supremo resigns amid milk scare: state media
Beijing (AFP) Sept 22, 2008The head of China's product-quality agency, Li Changjiang, stepped down Monday, state media said, amid a scandal over toxic milk that has killed four children and sickened nearly 53,000. |
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