Making a few headlines this deal globally, good summary...

Making a few headlines this deal globally, good summary below.

Australia Approves China’s Investment in Fortescue

By Jesse Riseborough

March 31 (Bloomberg) -- China’s Hunan Valin Iron & Steel Group A$1.3 billion investment in Fortescue Metals Group Ltd. was approved with conditions by Australia’s Treasurer Wayne Swan.

The investment, a 17.6 percent stake acquired through new stock and from shareholder Harbinger Capital Partners, is subject to “formal and strict undertakings” from Valin and agreed to by Fortescue, Swan said today in e-mailed statement.

Chinese investments are facing increasing opposition in Australia as the world’s biggest consumer of raw materials speeds up takeovers amid a global recession. Australian lawmakers this month voted to start an inquiry into foreign investment laws amid a backlash over Aluminum Corp. of China’s planned $19.5 billion investment in Rio Tinto Group.

The conditions apply to Valin board nominations and cover potential conflicts of interest with sales and marketing, Swan said. They require the company to report to Australia’s Foreign Investment Review on its compliance with the conditions, he said.

Valin acquired a A$1.2 billion stake after buying new stock as well as shares from holder Harbinger Capital Partners last month. It bought a further $87 million of shares on March 9.

Fortescue, Australia’s third-biggest iron ore exporter, rose 2.4 percent to A$2.55 at the 4:10 p.m. Sydney time close on the Australian stock exchange. Valin is China’s ninth-largest steelmaker.

To contact the reporters for this story: Jesse Riseborough in Melbourne at [email protected]