WISCO cleared

Finance

Publishing Date: 05 Nov 2009 3:06pm GMT
Author: Mining Journal

Australia’s Foreign Investment Review Board (FIRB) has approved another Chinese investment in the domestic mining sector. No objection has been raised for the proposed A$271 million (US$246 million) deal between Wuhan Iron & Steel Co (WISCO) and South Australian iron-ore explorer Centrex Metals Ltd.

State-owned WISCO is now clear to take a 60% stake in the iron-ore rights to five Centrex-owned tenements.

The joint venture deal, first announced in December 2008, will see WISCO take a direct equity stake of 15% in the enlarged capital of Centrex for A$10.1 million, and entitles WISCO to one seat on an expanded six-person board.

WISCO will also place up to A$186 million directly into Centrex, with staged payments linked to the achievement of JORC inferred resource milestones progressing up to 2,000Mt.

Centrex chairman David Lindh said the WISCO deal meant Centrex would enter 2010 with a well-funded iron-ore growth strategy with a strong foundation of existing contracts and commitments.

“Significantly, all of the cornerstones are now in place to rapidly escalate our iron-ore growth on Eyre Peninsula into a billion dollar business with further and considerable multi-project development opportunities,” he said.