Wednesday, January 6, 2010

Yanzhou Coal's $3b takeover of Felix "marks a new start" in Chinese acquisitions in Australia

The $3 billion purchase of Australian coal miner, Felix Resources by Yanzhou Coal Mining of the Peoples Republic of China could open the door to more Chinese acquisitions. “Yanzhou’s successful takeover marks a new start in cooperation between Australia and China,” said China’s ambassador to Australia, Zhang Junsai, quoted by Reuters. “China brings not only capabilities, jobs and opportunities, but also secure long-term market share.”

The buyout was the biggest by a Chinese company in Australian mining history and among the top 10 mergers and acquisitions in Australia in 2009. Australia established new investment guidelines in 2009 that did not favor majority foreign stakes in its mining industry, raising concerns in the Chinese government of a bias against foreign investment.

“People shouldn’t forget that Australia is built on the back of foreign investment,” said Martin Ferguson, the Australian resources minister.

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