Sinosteel nears successful Midwest bid

Sinosteel's US$1.3 billion bid for control of Australian miner Midwest Corp moved closer to completion yesterday, despite opposition from rival Australian firm Murchison Metals, the Wall Street Journal reported. While Murchison refused to sell Sinosteel its existing 10% stake in Midwest, which would give Sinosteel more than 50% of Midwest shares, the Chinese firm reached agreements with four Midwest directors with holdings of 4.1%. That would increase Sinosteel's holdings to 49.7%. A source familiar with the situation was quoted as saying Sinosteel is now set to cross the 50% threshold. Murchison had earlier announced that it would scrap a proposed merger with Midwest, citing an inability to reach an agreement with Sinosteel.

For more on Chinese investment in Australia's iron ore industry, see this report from our July issue.