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| HOME >> Topics List >> September, 2009 >> 11 (Fri) |
| FerrAus, China Railway Materials (CRM) Forge Strategic Alliance |
| = CRM to take placement to become 12% shareholder in FerrAus = |
|
Australian resources developer FerrAus Limited ("FerrAus") announced September 8 the conclusion of an agreement with China Railway Materials Commercial Corporation ("CRM") on strategic cooperation focused on iron ore development. CRM is a large-scale Chinese state-owned enterprise with its major business line-up being provision of materials for railway system operation and trading of steel products. Under the agreement, CRM will, through its wholly owned subsidiary Union Park Company Limited, take a placement in FerrAus equal to 12% of the fully diluted enlarged capital at the time of completing the transaction. Given current capital structure of FerrAus, CRM's investment would be approximately A$12.6 million. FerrAus and CRM have agreed to cooperate in respect of other potential iron ore resource opportunities in the eastern Pilbara region of Western Australian that, together with FerrAus' existing resources, can be used to support the financing and construction of rail and port infrastructure necessary for the development of the combined iron ore resources. On a non-binding basis, CRM intends to assist FerrAus with sourcing financing for the construction of Pilbara rail infrastructure for iron ore exports. The parties are to discuss terms on which, in return for securing substantial funding for the construction of suitable rail infrastructure, CRM will receive a substantial entitlement, at market terms to be negotiated, for iron ore offtake. The cooperation with CRM follows the placement of a 9.9% shareholding in the Company to China Western Mining in mid 2008, making it the second major Chinese investment in FerrAus. |
| last modified : Wed 16 Sep, 2009 [10:32] |
