China’s largest metals trader, China Minmetals Corp, will set up a joint venture with its controlled company Hunan Nonferrous Metals Holding Group (HNG) to consolidate its domestic nonferrous metals business.
Minmetals will inject most of its nonferrous mining assets into the new venture and use it as a platform to acquire domestic mining assets domestic. The new joint venture will be based in Central China's Hunan province.
Details of shareholdings in the new venture have not been disclosed, nor have details of the enterprise’s leading executives.
In February Zhou Zhongshu, president of Minmetals, said that his company was seeking to acquire more mining assets both at home and abroad during the course of this year and that Minmetals aims to become one of the world's leading miners. The company would focus on State-owned mines because the government is encouraging mergers and acquisitions in the mining sector to build up scale and competitiveness.
"We aim to be the world's largest rare earth supplier and the leading producer of tungsten, antimony, lead and zinc," he said.
Minmetals took control of HNG after taking its shareholding to 51 percent in the Hong Kong-listed State-run miner in December. Last year Minmetals bought Australian zinc and mining company Oz Minerals for $1.4 billion to shore up its overseas presence.
Analysts expect to see more mergers and acquisitions among miners as the Chinese government strives to streamline the fragmented sector. Central State-owned enterprises are no longer required to get permission from local governments to acquire local State-owned enterprises.
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