Ansteel gets nod to increase stake in Gindalbee

09 May 2009

Australian Treasurer Wayne Swan has approved China's Anshan Iron & Steel (Ansteel) Group's application for a stake of up to 36.28 per cent in Australia's Gindalbie Metals. The approval of Ansteel's application comes with certain conditions.

The deal will be closely followed for implications on a proposed tie-up between Aluminium Corp of China (Chinalco) and Anglo-Australian mining giant Rio Tinto.

Swan said that under the Ginadalbee deal Ansteel was required to support the development of certain infrastructure in Western Australia, including the Oakajee port and rail project.

Ansteel would also be under obligation for equal ownership with Gindalbie of a pellet plant in China. The plant would process iron ore from the joint venture Karara Iron Ore project it had with Gindalbie.

Swan said the undertakings would support Australian mining jobs and protect Australia's investment participation in the Chinese resources market.

Ansteel is China's second-largest steelmaker by output and it first put forward the proposal to buy the Gindalbie stake in December. The company was asked by Australia's Foreign Investment Review Board to resubmit the application four times in January, February, March and finally in April.