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Brazilian iron ore miner bought by Chinese for $1.2bn

Brazilian iron ore miner bought by Chinese for $1.2bn

Shanghai: East China Mineral Exploration and Development Bureau Wednesday agreed to acquire Brazilian iron ore miner Itaminas Comercio de Minerios for US$1.2 billion, Reuters reported.
The two firms have signed a letter of intent, said the media office of Winbros, a consultancy firm that was hired by Itaminas for the transaction. However, Winbros did not disclose further information on the deal.
Itaminas, which is based in Minas Gerais state in Southeast Brazil with estimated reserves of 1.3 billion tons, has an annual output of 3 million metric tons of iron ore.
China's iron ore contract price talks with the world's leading suppliers have entered the final stage and that the suppliers have asked an increase of between 70% and 80% in the price of iron ore.
The strategy from China these days is to buy out as much of its needed raw material supply chain as possible. Speaking at the Shanghai International Shipping Forum this week, Lejiang Xu, the chairman of China's largest steel mill, Baosteel, explained: 'China will more frequently look for new overseas mineral resources, invest in mining and participate in the international strategic layout of the industrial chain, such as the acquisition of mines and building of new steel mill. In the medium to long term, the shadow of resource monopoly that has shrouded the Chinese steel industry will be broken.' [26/03/10]

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