I wonder what the concessions the Chinese are demanding? They...

I wonder what the concessions the Chinese are demanding? They may have problems if it is more than a 15% stake IMHO.

http://www.bloomberg.com/apps/news?pid=20601089&sid=aygAsjjENwq0

Fortescue May Win Funding Deal Soon, Liberum Says (Update1)
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By Rebecca Keenan

Oct. 1 (Bloomberg) -- Fortescue Metals Group Ltd., Australia’s third-biggest producer of iron ore, will probably secure $6 billion from Chinese lenders in the “near future” after missing a deadline yesterday, Liberum Capital said.

“Most likely due diligence is taking longer than expected, and we would expect this deal to resurface in the near future,” Michael Rawlinson, an analyst at Liberum in London, wrote in a note yesterday. A delay will hurt expansion plans, he wrote.

Securing the Chinese funds was part of an iron ore price agreement last month with the China Iron & Steel Association and Baosteel Group Corp, Fortescue had said. The miner needs the capital for a plan to more than double exports by 2012.

“Fortescue is scheduled to produce 45 million tons a year of iron ore and this financing would have allowed the expansion to 90 million tons a year to press ahead, the timing of which could now be in jeopardy,” Rawlinson said.

Fortescue dropped 3.7 percent to A$3.68 in Sydney at the 4:10 p.m. local time close, the seventh day of decline.

A delay in expansion may tighten market supply and benefit Rio Tinto Group and BHP Billiton Ltd., the two largest iron ore producers in Australia, Rawlinson wrote.

China Investment Corp., the nation’s sovereign wealth fund, suspended financing talks with Fortescue until the mining company agrees to make concessions, the Caijing Magazine reported yesterday, citing an unidentified official at the fund.

Fortescue held talks with major Chinese financiers, Forrest said last month, without naming them. Securing financing is a condition of the iron ore price agreement under which Fortescue agreed to supply Chinese mills with ore at a 35 percent price reduction to last year.

To contact the reporter on this story: Rebecca Keenan in Melbourne at [email protected]