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Evraz Joins Chinese in Aussie Iron Buy
The Evraz Group has acquired 16 percent of the stock in the Australian mining company Cape Lambert Iron Ore, a Perth-based company that runs a mine in the state of Western Australia that is estimated to be worth $390 million. China Metallurgical Group plans to buy 70 percent of the same company by the end of the month, paying a third over market price for those shares.
Besides Evraz and China Metallurgical, the Australian company held negotiations with Sinostell of China, Citic Resources Holdings of Hong Kong and Tata Steel of India. It signed a preliminary agreement with China Metallurgical on the sale of 70 percent of its stock for $380 million in February. The final decision on the sale of Lambert will be made at a shareholders meeting on July 28.
The price of Lambert shares rose 8.9 percent yesterday to 79.5 Australian cents (US$0.77), which brought the company’s capitalization to $200 million. The mine will require investment of not less than $1 billion to reach its projected capacity of 35-40 million tons of iron ore per year. Nonetheless, the Lambert shares may be a moneymaker for Evraz. Alisher Usmanov’s Gazmetall holding made a profit of $275 million when it sold its 19.7-percent share in the Australian Mount Gibson mining company a year and a half after acquiring it. and Magnitogorsk Mining and Metals made $179 million on 5.37 percent of Fortescue Metals in less than a year.
www.kommersant.com
All the Article in Russian as of July 18, 2008
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