Yanzhou wins Aussie nod for Felix
By Fu Chenghao |
October 24, 2009, Saturday
|
Print Edition
Print Edition
CHINA'S Yanzhou Coal Mining Co has won approval from the Australian government for its A$3.5-billion (US$3.2 billion) acquisition of coal miner Felix Resources Ltd, but with strict conditions.
Yanzhou, the Shandong Province-based company, must list its Australian assets in Australia by the end of 2012, and by that time, reduce its ownership to less than 70 percent, Assistant Treasurer Nick Sherry said yesterday.
Yanzhou will operate the Australian miners through an Australian incorporated and headquartered company, Yancoal Australia Proprietary Ltd.
"It represents the first time a Chinese state-owned enterprise operating in Australia will list on our stock exchange. As such, it demonstrates the strength of the developing bilateral economic and investment partnership between Australia and China," Sherry said.
Yancoal Australia must use a predominately Australian management and sales team, and hold the majority of its board meetings in Australia, he said. Among other conditions, the chief executive officer and chief financial officer of Yancoal Australia must have their principal place of residence in Australia.
As several of the mines operated by Felix are owned by joint ventures with third parties, Yanzhou's ownership of the underlying mining assets must stand at no more than 50 percent following the listing and reduced holding in Yancoal Australia, Sherry said.
"With these undertakings provided by Yanzhou, I consider that this acquisition is consistent with Australia's national interests," Sherry said.
Bids by several Chinese companies to buy into Australia's resource sector have been rebuffed amid intense scrutiny from Australian lawmakers, as improved conditions in capital markets allow debt-laden companies to tap public funds more easily than before.
In June, iron ore giant Rio Tinto rejected a US$19.5-billion investment from Aluminum Corp of China.
Australia's Foreign Investment Review Board last month blocked a bid by China Nonferrous Metal Mining (Group) Co to purchase a controlling stake in rare earths producer Lynas Corp.
Yanzhou, the Shandong Province-based company, must list its Australian assets in Australia by the end of 2012, and by that time, reduce its ownership to less than 70 percent, Assistant Treasurer Nick Sherry said yesterday.
Yanzhou will operate the Australian miners through an Australian incorporated and headquartered company, Yancoal Australia Proprietary Ltd.
"It represents the first time a Chinese state-owned enterprise operating in Australia will list on our stock exchange. As such, it demonstrates the strength of the developing bilateral economic and investment partnership between Australia and China," Sherry said.
Yancoal Australia must use a predominately Australian management and sales team, and hold the majority of its board meetings in Australia, he said. Among other conditions, the chief executive officer and chief financial officer of Yancoal Australia must have their principal place of residence in Australia.
As several of the mines operated by Felix are owned by joint ventures with third parties, Yanzhou's ownership of the underlying mining assets must stand at no more than 50 percent following the listing and reduced holding in Yancoal Australia, Sherry said.
"With these undertakings provided by Yanzhou, I consider that this acquisition is consistent with Australia's national interests," Sherry said.
Bids by several Chinese companies to buy into Australia's resource sector have been rebuffed amid intense scrutiny from Australian lawmakers, as improved conditions in capital markets allow debt-laden companies to tap public funds more easily than before.
In June, iron ore giant Rio Tinto rejected a US$19.5-billion investment from Aluminum Corp of China.
Australia's Foreign Investment Review Board last month blocked a bid by China Nonferrous Metal Mining (Group) Co to purchase a controlling stake in rare earths producer Lynas Corp.
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