UK-based miner London Mining is to enter the Chinese iron ore industry with an agreement to purchase a 50 percent stake in China Global Mining Resources (BVI) Limited,(CGMR),a joint venture with the US-based Wits Basin Precious Minerals a a cost of $39.25 million. London Mining will also agree to make a loan of USD 5.75 million to Wits Basin. Both the share purchase and the loan will be funded from London Mining's existing cash resources.
CGMR is in the business of buying three Chinese companies: Xiaonanshan Mining Co limited and Nanjing Sudan Mining Co limited, which operate iron ore mining and processing operations near Maanshan in the Anhui and Jiangsu Provinces; and Maanshan Zhaoyuan Mining Co Ltd which is owned by the sellers of Xiaonanshan Mining Nanjing Sudan.
Christopher Brown, Managing Director of London Mining said "This joint venture with Wits Basin is of great strategic importance to us and it should help to regenerate interest in our company. We will be one of the first western companies to own a profitable iron ore mine in China, a country which is the largest importer of iron ore in the world."
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