FMG suspends share trading pending commercial negotiation outcome
Shanghai. August 14. INTERFAX-CHINA - Fortescue Metals Group Ltd. (FMG), Australia's third-largest iron ore producer, suspended trading on the Australian Securities Exchange (ASX) on Aug. 14, pending an announcement regarding ongoing commercial negotiations, according to an ASX release.
FMG shares will resume trading on Aug. 17, and a release regarding the completion of the negotiations is expected then. The company has not disclosed any details about the talks.
There is speculation that China Investment Corp. (CIC), China's sovereign wealth fund, is in advanced talks with FMG to fund the miner's expansion plan through a convertible bond deal worth $1 billion.
CIC representatives were unavailable for immediate comment when contacted by Interfax.
An industry analyst, who asked to remain anonymous, told Interfax on Aug. 14 that CIC has long been in talks with FMG over possible investments, and it will be in the country's best interests if CIC gains access to the resources of Australia's third-largest iron ore miner.
In July, CIC inked an agreement to invest $1.5 billion into Canada's largest diversified mining company Teck Resources Ltd., in exchange for a 17.2 percent equity stake in the company.