Hanlong Group Counts Down for Acquiring Sundance
CHENGDU, Jul 09, 2012 (SinoCast Daily Business Beat via COMTEX) -- After getting approval from the Australian government half a month ago, Sichuan Hanlong (Group) Co., Ltd. is now counting down for the acquisition of Sundance Resources Ltd.
Recently, Hanlong Mining under Hanlong Group received a notice from the National Development and Reform Commission (NDRC), saying that the deadline for approval will be deferred from June 30 to July 31, 2012.
Hanlong Group revealed that the consideration and investment for the project are USD 1.6 billion and USD 5 billion respectively. The production will commence from 2015.
A researcher from the World Economics and Politics Institute under the Chinese Academy of Social Sciences (CASS) pointed out that China currently imports 60% of its iron ores needed. The acquired project will break the monopoly of global top three iron ore suppliers.
On June 22, Sundance Resources announced that Hanlong Group has been approved by the Foreign Investment Review Board (FIRB) to acquire the 100% stake in the Australian miner for AUD 0.57 per share. Hanlong Group will become the majority shareholder of Sundance Resources by taking a 17% stake.
The acquisition targets include Mbalam iron mine in Cameroon, which is unlikely to have high costs and overspending, particularly, hovering labor costs like the situation in Australia.
A top executive from Hanlong Resources believed that the company's favorable offer, compelling promise and improvement in top management are the key factors for the Australian government to choose Hanlong Group. Hanlong Resources is a subsidiary of Hanlong Group responsible for the acquisition of mineral resources.
Price Waterhouse Coopers (PwC) has been invited as the advisor for Hanlong Mining, which also employs professional lawyers and governmental consultants to lobby the Australian government the positive impact of the acquisition.
Sundance Resources is very experienced in local mining in Africa. Moreover, the company has close relationship with governments in both Australia and Cameroon.
In April 2012, Sundance Resources, Hanlong Mining and the local government in Cameroon held negotiations on their mining agreement. With a professional technology team, Sundance Resources played an important role in the negotiations.
If the acquisition agreement could be carried out, Hanlong Group needed to get approval from both the NDRC and the FIRB before June 30 and the deadline was finally postponed to July 31. Besides, China Development Bank (CDB) should agree to grant loans to the company by August 31.
If new competitors offer higher prices in the future, the board of Sundance Resources may consider choosing other buyers. Hence, Hanlong Group must complete the acquisition as soon as possible. Potential buyers include companies from India and South Korea as well as Rio Tinto and BHP Billiton.
- Forums
- ASX - By Stock
- SDL
- very interesting article from china press
very interesting article from china press
-
- There are more pages in this discussion • 10 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)