Fortescue hires JPMorgan, others to review Chinese proposals

Fortescue Metals Group Ltd, Australia's third-largest iron ore exporter, has appointed JPMorgan Chase & Co, Azure Capital Pty and Grant Samuel & Associates Pty as advisers to review the proposals it had received from various companies.

Earlier, there were reports that the London-based Anglo American Plc and China Investment Corp, a $200-billion sovereign wealth fund, are in discussions with Fortescue for acquiring a majority stake in the Australian mining giant. Anglo American controls the world's biggest platinum producer.

The appointment of investment bankers is seen as a definite move on Fortescue's side to continue with the smooth selling of resources to a foreign firm.

In a letter to the Australian Stock Exchange on Tuesday, Fortescue confirmed that it has held talks with Anglo American plc and China Investment Corp, but reiterated that the talks are preliminary and incomplete.

The move by China Investment Corp is seen as the latest one by Chinese firms for Australian resource companies. China, the biggest buyer of raw iron ore, has already acquired $22 billion worth of commodity assets this year. Rio Tinto Ltd, the world's third-biggest mining company, and Aluminum Corp of China (Chinalco) are about to sign a $19.5-billion deal for sharing some of its mining sites (See: Chinalco invests $19.5 billion in Rio Tinto to raise stake to 18 per cent), while Oz Minerals Ltd, the second-biggest zinc producer, has received a $2.6-billion takeover offer from China Minmetals Corp

The Chinese companies planned entry into Australia's iron ore, copper and aluminium operations has alarmed many of the metal companies' institutional shareholders in Australia and Europe.