The Foreign Investment Review Board (FRIB) has approved Chinese state-owned steel producer Baosteel’s $286 million investment in Pilbara iron ore miner Aquila Resources.
Subject to approval by the Chinese Government’s regulatory body, Baosteel will take a 15% stake in Aquila.
Baosteel could take an additional 4.99% under the provisions of the FIRB approval.
In a statement, Aquila said it expected the transaction to be completed in late-November.
According to Baosteel vice-president Zhihao Dai, “The approval represents a significant step forward in the company’s international development.”
“The final step in the process is approval by the Chinese government and we understand that this stage is well advanced,” he said.
Aquila executive chairman Tony Poli said the company was extremely proud to have one of the world’s largest steelmakers on board to fast-track its iron ore, coal and manganese projects.
“This is a positive step forward for the development of important mineral assets in the Pilbara region of Western Australia,” he said.
“We consider the investment a major vote of confidence in the company and its management.”
Aquila shareholders approved the deal on at the company’s general meeting last week.
Baosteel has also signed a memorandum with Aquila to further explore project-level investments.