Wuhan Iron & Steel (Group) Co., Ltd
Wuhan Iron & Steel (Group) Co., Ltd – Hawks Nest Joint Venture with Western Plains Resources Limited
We advised Wuhan Iron & Steel (Group) Co., Limited (“WISCO“) on its joint venture with Sydney based Western Plains Resources Limited (“WPG“) with regard to a 50/50 joint venture to complete a feasibility study and, if the study proves positive, development of one or more of the magnetite deposits located in WPG’s Hawks Nest tenements south of Coober Pedy in South Australia. WISCO will “sole fund” a minimum commitment of AU$25 million to earn a 50% participating interest in the joint venture and also subscribe for approximately 12.1 million shares in WPG for a sum of approximately AUD3 million. We assisted WISCO with the negotiation and agreement of the various transaction documents relating to the joint venture and share subscription attending negotiations in both Australia and China. The transaction documents were executed on 11 June 2009. Again this followed comprehensive due diligence into the potential investment and extensive negotiations of binding Heads of Agreement to establish the commercial terms for the Chinese investment. The condition precedent fulfillment time had been extended for the joint venture in response to consideration of the project by the Australian Department of Defense which in the end stalled the project for too long and the project was sold instead to Onesteel Ltd.
Wuhan Iron & Steel (Group) Co., Ltd – Eyre Iron Joint Venture with Centrex Metals Limited
We advised Wuhan Iron & Steel (Group) Co., Limited (“WISCO“) on its joint venture with Adelaide based Centrex Metals Limited (“Centrex“) relating to development of Centrex’s magnetite prospects located near to Port Lincoln in South Australia. WISCO will pay Centrex a total of up to AUD186 million for 60% equity in the joint venture and also subscribe for just over 40 million shares in Centrex for a sum of approximately AUD10 million. We assisted WISCO with the negotiation and agreement of Joint Venture Agreement, Farmin Agreement, Share Subscription Agreement, Shareholder Agreement and Management Agreement, with negotiations in both Australia and China. The transaction documents were executed in Wuhan on 20 July 2009. This followed comprehensive due diligence into the potential investment and extensive negotiations of binding Heads of Agreement to establish the commercial terms for the Chinese investment. The Foreign Investment Review Board approved the investment on 2 November 2009.