Jinchuan Group gets nod to buy 11% of Fox Resources

Jinchuan Group Ltd, China's largest nickel and cobalt producer, has won state approval for its plan to buy an 11% stake in Australian nickel producer Fox Resources, sources reported.

The Lanzhou, Gansu province-based company agreed to spend A$17.9 million (around RMB 115 million) to buy 18.8 million common shares in Fox at a premium issue price of A$0.95. After the deal, Jinchuan will become the largest shareholder in the Australian counterpart. Fox's shares closed at A$0.49 on Friday.

In addition, Jinchuan got access to acquire eight million new shares at the price of A$1.2 apiece one year after this deal.

Jinchuan acquired a similar size of stake in another Australian nickel miner Allegiance Mining last year, and in January it agreed to pay Tyler Resources Inc about US$213 million cash for Mexico's biggest untapped copper-zinc deposit. It posted a handsome net profit of RMB 6.02 billion last year and it owns an annual nickel- and cobalt-making capacity of 100,000 tons and 10,000 tons, respectively.