Chinese miner makes new Australian offer amid spy-threat concern

Last Updated: Mon, 30 Mar 2009 09:13:00 +1100

A Chinese state-owned mining company has put forward a new takeover offer that could save debt-laden Australian miner Oz Minerals from collapse.

Executives from the Chinese group Minmetals finalised the offer during urgent talks with Oz Minerals over the weekend.

A Minmetals spokesman would not comment on details of the offer but says it meets the needs of all sides.

National security concerns scuttled the initial $2.6 billion bid because it included the Prominent Hill mine, which sits on defence land in the state of South Australia.

Now OZ Minerals says any new deal would exclude Prominent Hill.

Considering alternatives

The government said it cannot approve Minmetals' bid for Oz Minerals if it includes Prominent Hill.

But the country's treasurer, Wayne Swan, says he is willing to consider alternative proposals and the Foreign Investment Review Board (FIRB) is in talks with Minmetals about Oz Minerals' other businesses and assets.

Talks with bankers

Oz Minerals' debt exceeds $1 billion and the company stated it will probably go into receivership if the Minmetals deal does not succeed.

In a statement, Minmetals has expressed its intention to continue pursuing OZ Minerals.

"Minmetals remains in discussions with FIRB," the statement said.

"Our focus is on delivering an agreed solution to OZ Minerals that meets national interests, can satisfy lenders, deliver stability to employees and protect existing operations."

Oz Minerals says it remains in constructive talks with its banks over its debt, which is due to be refinanced by Tuesday.

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