Interesting....!Here's the article:Fortescue Wants to Sell Stake...

Interesting....!

Here's the article:

Fortescue Wants to Sell Stake in Rail, Port Unit (Update1)

By Rebecca Keenan

March 7 (Bloomberg) -- Fortescue Metals Group Ltd., building an iron ore mine that will make it Australia's third-largest producer, wants to sell a 49 percent stake in the rail and port unit for the A$2.8 billion ($2.6 billion) Pilbara project.

``We always created The Pilbara Infrastructure Pty as a separate company because we saw that as being an entity that might be attractive to a different group of investors,'' Graeme Rowley, executive director of Perth-based Fortescue, said in an interview.

Fortescue, controlled by Andrew Forrest, Australia's richest man, is scheduled to ship its first ore to China in May after signing supply accords with mills including Baosteel Group Corp. Bringing in a joint venture partner would help fund a proposed A$10 billion expansion of the project, Rowley said.

``With the way capital costs for mining projects are going, this is another way to raise money, by flogging off the infrastructure,'' Gavin Wendt, a senior resources analyst at Fat Prophets Funds Management in Sydney, said by phone. ``It's the only way now they can raise cash without sending out alarm bells.''

Fortescue has risen more than fourfold in the past year and is the second-best performer on the Australian benchmark index. It fell 11 cents, or 1.3 percent, to A$8.17 and at the 4:10 p.m. Sydney time close on the Australian Stock Exchange.

``Invariably the people that are interested are your customers,'' Rowley said. ``We may want to hang onto the value side of the business, the iron ore, ourselves.''

The mine, in the Pilbara region in the north of Western Australia state, is targeting an initial production rate of 55 million metric tons a year and the company is looking to increase that to 200 million tons a year through the expansion, Rowley said.

Forrest is Australia's richest man with a net worth of $6.5 billion, according to Forbes magazine.

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