China's Shandong Gold snares majority stake in Australia's Focus Minerals
Shandong Gold has obtained a 51% equity stake in Aussie gold producer Focus Minerals (ASX:FML) following the completion of an AUD$225mn placement to the northern Chinese miner.
The Australian reports that Focus shareholders gave the go-ahead to the deal earlier this month, and that the company hopes to use the cash injection to push forward development of existing gold projects in the Goldfields-Esperance region of Western Australia.
The company plans to spend $18m on drilling to expand ore reserves and $22m on the exploration of tenements situated in Laverton, Coolgardie and Treasure Island.
Focus Chairman Don Taig said the deal was one of the biggest in recent history for a mid-tier Australia gold miner and that it "underscores the importance of Australia-China mining interests."
Shandong Gold's general manager Zhang Dahui said the deal demonstrated the company's commitment to the development of business in Australia.
Shandong has appointed three of its leading executives to the board of Focus Minerals while current director Bruce McComish has also been entrusted with representing the interests of the Chinese company on the board.