Australian Perth-based mining company Fortescue Metals Group (Fortescue) has been informed by Australia's Foreign Investment Review Board (FIRB) that it has issued an interim order in relation to the application by China's Hunan Valin Iron and Steel Company (Valin) to acquire up to 17.55 percent of the issued capital of Fortescue. The transaction was announced to the market on 25 February 2009.
The interim order will extend the FIRB review period for up to a further 30 days from the date the order comes into operation, i.e. the date the order is published in the official journal which is expected to be March 25, 2009.
Under the terms of the share subscription agreement, Valin has committed to acquire 260 million shares to be issued by Fortescue, for a consideration of AU$644.8 million (approx. $410 million).
Fortescue remains confident that the structure of the share subscription agreement will enable Valin to obtain FIRB approval. The share subscription agreement is conditional on both FIRB and Chinese regulatory approval being granted.