Thu, June 11, 2009
Business > Industries > Chinese firms' global move

Australia approves revised OZ Minerals-Minmetals deal

2009-04-24 03:35:13 GMT2009-04-24 11:35:13 (Beijing Time)  SINA.com

Australia on Thursday approved a revised takeover offer from China's Minmetals for debt-laden miner OZ Minerals worth 1.21 billion dollars (850 million US).

Treasurer Wayne Swan last month scuttled the first bid on national security grounds because it included Prominent Hill copper-gold mine in South Australia, which is located near a military rocket testing range.

But Swan said Thursday he had accepted a revised offer.

"I approve a revised application by China Minmetals Non-ferrous Metals Co. Ltd. to acquire certain mining assets of OZ Minerals Ltd, but not including the Prominent Hill mine, conditional on legally enforceable undertakings," he said.

The conditions stipulate that Minmetals operate the assets it acquires as a separate business incorporated and headquartered in Australia, with a predominantly Australian management team.

"These undertakings, which are designed to protect around 2,000 Australian jobs, ensure consistency with Australia's national interest principles," Swan said.

OZ Minerals, which had previously warned it faced receivership if the deal was knocked back, welcomed the approval.

"We are very pleased that the treasurer has approved this transaction as it is the best currently available solution that resolves all of the company's refinancing issues," chairman Barry Cusack said.

OZ Minerals has also previously said the revised offer would erase its debt and leave it with 500 million dollars in cash, even though it is well below Minmetals' original 2.6-billion-dollar offer.

The deal is still subject to a shareholder vote and regulatory approvals from Beijing.

State-owned Chinese corporations have made a number of bids for Australian mining assets in recent months, including a proposed 19.5-billion-US-dollar investment in mining giant Rio Tinto by Chinalco which is still under review.

Hunan Valin Iron & Steel Group was allowed to increase its stake in iron ore miner Fortescue Metals Group to up to 17.55 percent, by investing more than one billion dollars.

(Agencies)

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