article in the australian

Hong Kong's Wah Nam to use Brockman stake to drive further iron ore consolidation Sarah-Jane Tasker From: The Australian June 21, 2011

HONG Kong's Wah Nam will use its major stake in Brockman Resources to drive further consolidation in the Pilbara iron ore sector and unlock an infrastructure solution for emerging hopefuls.
The investment company emerged with a 55.33 per cent stake in Brockman after its scrip offer -- 30 Wah Nam shares for each Brockman share -- closed last week, ending a seven-month hostile takeover that the Pilbara junior aggressively resisted.

Wah Nam chief investment officer Hendrianto Tee and adviser Warren Beckwith were appointed to the Brockman board on Friday as the Hong Kong company secured a majority stake.

"(The offer) represented the first step in the possible consolidation of other nearby assets, which could possibly share the same rail and port solution," Mr Beckwith said.

Wah Nam is also bidding for Brockman's Pilbara neighbour, FerrAus. That offer is open until July 15 and more likely to be successful now that the investment vehicle controls Brockman.

Wah Nam plans to merge the assets of FerrAus and Brockman, which both have port allocation in Port Hedland through the North West Iron Ore Alliance -- a crucial factor in any rail access negotiations.

Mr Tee said the company's grand plan had always been consolidation of projects in the Pilbara. "We see Brockman as an anchor for embarking on this consolidation project because of their size and the port allocation they have," he said.

"We plan to be working for more projects in Australia. We don't want to sound too boastful, but we do have our vision and plan and will execute it step by step according to our strategy."

The Wah Nam representatives are also confident of a harmonious working relationship with Brockman's board, despite the target's attempts to defeat the bid, including complaining to the Takeovers Panel about allegedly questionable trading behaviour by offshore investors associated with Wah Nam.

"The way the bid proceeded was relatively civil, but it is traditional in Australian takeovers for the defence to be robust and if the directors didn't use every tool at their disposal, the directors wouldn't be doing their upmost to ensure shareholders secure the best outcome," Mr Beckwith said.

"With all that behind us, we get along with the guys at Brockman . . . we are more than happy to work as part of the team and understand where they are at with their (infrastructure) negotiations with Fortescue Metals Group, which we are positive about."

The immediate task was to work towards the bankable feasibility study, including understanding Brockman's infrastructure plan, but Mr Tee hinted Wah Nam also had its own ideas, which would form part of board discussions. "We have our own ideas but for the benefit of co-operation, we will give time to the current planning of Brockman and will study it carefully," he said.